T

he Upstream Oil and Gas Regulatory Task Force (SKKMigas) is targeting to increase gas utilization in the country by lifting the target of deliveries to domestic clients next year.

SKKMigas spokesman Rudianto Rimbono said on Friday that the regulator projected that domestic deliveries would increase by around 9 percent compared to this year'€™s target.

'€œIn 2015, the commitment for domestic deliveries is expected to be around 61 percent [of total output],'€ Rudianto said.

Under the work plan and budget, next year gas output is targeted to be 6,592 million standard cubic feet per day (mmscfd). Given that domestic absorption is supposed to be 61 percent, the local market is expected to consume around 4,021 mmscfd next year while the remaining will be sent overseas.

The total amount will also cover the output of liquefied natural gas (LNG) of 200 cargoes next year, of which as many as 58 cargoes will be delivered to the domestic market, according to Rudianto.

The government has been trying to increase the domestic absorption of gas, as part of an attempt to reduce the usage of oil fuel. SKKMigas is expecting to see that 53.8 percent of total gas production is consumed by domestic players this year, or around 3,686 mmscfd of the total estimated output of 6,853 mmscfd.

According to Rudianto, the realization of domestic gas deliveries has currently reached 54 percent total utilization. SKKMigas recorded that the gas supply for the domestic market increased by around 9 percent per year since 2003.

Indonesia has 104 trillion standard cubic feet (tscf) estimated proven gas reserves and 48 tscf in potential gas re-serves, making it the 13th largest owner of proven natural gas reserves in the world and the second biggest in the Asia-Pacific region after China, according to the International Energy Agency. Due to the resources and low domestic absorption, the country has long been a major exporter of the liquefied natural gas (LNG).

A number of infrastructure projects to support gas deliveries to domestic markets are ongoing, such as the development of 350 kilometer Arun-Belawan pipeline along with the re-gasification refinery in Aceh and a number of float-ing storage re-gasification units (FSRUs).

An FSRU operated by Jakarta listed PT Perusahaan Gas Negara (PGN) in Lampung has started its operation last July. Five cargoes of LNG from Tangguh plant in Papua have been allocated for the Lampung facility this year.

However, the Lampung FSRU, which distributes the gas to its clients particularly the state owned electricity firm PT Perusahaan Listrik Negara (PLN) will only able to absorb four of the five cargoes allocated. The fourth cargoes to Lampung FSRU is scheduled to arrive by the end of this December.

For next year, the Lampung FSRU has 14 LNG cargoes in allocation, SKKMigas said earlier.

PGN assistant vice president for corporate communication Irwan Andri Atmanto said his company was currently in talks with BP Tangguh, the operator of the Tangguh LNG plant, for next year'€™s deliveries.

'€œWe are finalizing talks with SKKMigas and BP Tangguh. Under the plan, we are planning to receive 11 cargoes from Tangguh next year,'€ Irwan said.

Apart from the Lampung FSRU expected growing absorption, the start of deliveries from gas fields will also contribute to the higher consumption.

Joint operating Body Pertamina Talisman Jambi Merang, which is operating Jambi Merang block, recently signed an agreement with Perusahaan Daerah Pertambangan dan Energi (PDPDE) Sumatera Selatan for the delivery of up to 5 mmscfd gas. PDPDE has started to deliver 0.01 mmscfd on Wednesday to feed gas fired plant (PLTMG) in Purwodadi village, Tanjung Jabung Barat regency, Jambi.