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tate-owned oil and gas giant Pertamina plans to work on several infrastructure development projects to tap the liquefied natural gas (LNG) market in the near future amid current demand uncertainty.

Among planned projects is a floating storage and regasification unit (FSRU) in Cilacap, Central Java, four land-based LNG terminals - in Bojanegara (West Java), Benoa (Bali), Porong (East Java) and Makassar (South Sulawesi)-, and three mini LNG plants each in Simenggaris and Nunukan, North Kalimantan and in Salawati in West Papua.

'€œAll are in Pertamina'€™s pipeline of development and we are focusing on the mini LNG development,'€ Pertamina vice president for corporate communications Wianda Pusponegoro said on Thursday.

However, the development closest to being realized is the FSRU in Cilacap. It is currently in the final investment decision stage, according to Wianda. The facility, which will have 200 million standard cubic feet per day (mmscfd) in capacity, is expected to be completed by 2017.

'€œWe are looking at the growth estimate for gas demand in the country,'€ she said, referring to factors driving the company to be aggressive in LNG facility development.

The country is estimated to have significant gas resources, particularly in the deepwater fields in the frontier areas.
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The government has been calling for more deliveries of LNG cargoes to the domestic market to reduce the country'€™s dependency on petroleum-based fuel.

It is also known as a major LNG exporter, partly because the country lacks domestic facilities to absorb and deliver the gas.

The government has been calling for more deliveries of LNG cargoes to the domestic market to reduce the country'€™s dependency on petroleum-based fuel.

Infrastructure has been built to support the domestic consumption of gas, such as the West Java FSRU owned by Nusantara Regas, a regasification terminal in Arun operated by Pertamina and an FSRU in Lampung operated by state-owned gas distributor Perusahaan Gas Negara (PGN).

Amid more plans to develop infrastructure, the country'€™s gas market remains unstable-particularly due to slowing economic growth. The slump has pushed down gas demand, in turn threatening the future of processing and distribution facilities, including the FSRU. PGN stated earlier that its Lampung FSRU, which commenced operations last year, was currently idle amid lower than expected demand growth.

The Lampung FSRU should have received liquefied natural gas (LNG) cargoes sent from the Tangguh plant in West Papua, regasified them and then delivered the gas to customers, including state-owned electricity firm PLN and a number of industries in Lampung and West Java.

 PLN is seeing lower electricity than in previous years, pushing down the company'€™s energy consumption to feed its power plants.

The Energy and Mineral Resources Ministry'€™s director for upstream oil and gas, Djoko Siswanto, said discussions were ongoing between PGN and PLN to ensure the electricity company realizes its commitment to using gas to feed a number of its power plants.

'€œPLN is committed to gas absorption. However, it has yet to reveal the volume it needs. Discussions also cover the price issue, in which PGN offers an option to relate gas prices to diesel fuel,'€ Djoko said.