B

ank Mandiri has agreed to provide US$52 million in loans to PT Nusantara Regas, a company jointly owned by state oil and gas firm PT Pertamina and state gas distributor PT Perusahaan Gas Negara (PGN), to support its business activities.

The one-year loan followed a non-cash loan amounting $100 million that Bank Mandiri channeled to the company in March this year, which has so far been 85 percent disbursed.

Nusantara Regas recently began the operation of a floating storage and re-gasification unit (FSRU) in Java bay in West Java that delivers gas from the Mahakam block in East Kalimantan to the Muara Karang gas and coal fired power plant (PLTGU) owned by state power company PLN.

“We hope that Nusantara Regas can utilize this credit facility to support the operations of its FSRU,” Bank Mandiri institutional banking director Abdul Rahman said on Wednesday.

Nusantara Regas’ FSRU, the first facility of its kind in Asia, takes deliveries of liquefied natural gas (LNG) from tankers and turns it back into gas, a process known as re-gasification, before pumping it to the power plant through the undersea pipeline.

The FSRU has a total capacity of storing and regasifiying 3 million tons per annum (mtpa) of LNG.

The unit, however, is currently producing at less than 50 percent of its full capacity as LNG supply to the facility is still limited, according to Nusantara Regas president director Hendra Jaya.

At the moment, the firm’s FSRU receives 1.06 mtpa from the Bontang LNG plant in East Kalimantan.

“Our major challenge now is how to get additional supply for our [FSRU] so it can produce at its full capacity of 3 million [mtpa],” he said on Wednesday, adding that his company might aim to get the additional supply from the LNG plant belonging to oil and gas giant BP in Tangguh, among other sources.

Nusantara Regas plans to use the additional capital from Bank Mandiri to finance its activities, especially in managing the FSRU so its production capacity could be increased, he added.

As of July this year, Regas had delivered as much as 200 million standard cubic feet per day (mmscfd) of natural gas to PLN. The Muara Karang power plant absorbed 165 million mmscfd, while the rest was delivered to PLN’s plant in Tanjung Priok, North Jakarta.

As reported earlier, both PLN and Nusantara Regas have agreed on a price of $14.43 per mmbtu. Nusantara Regas’ Hendra agreed that the price was neither too expensive nor too cheap, meaning it was a win-win solution for both his company and PLN.

The construction of the FSRU is part of the government’s mission to provide better infrastructure for the domestic oil and gas industry in anticipation of rising domestic demand for gas, which is predicted to jump from 3,500 mmsfcd to 4,700 mmscfd in 2015.

The government has been encouraged an increase in the use of natural gas, especially for power generation, considering the fact that natural gas is relatively cleaner than other fossil fuels.

“We support any government programs that aim to reduce the usage of oil for powering PLN’s power plants,” said Bank Mandiri’s Abdul. Indonesia plans to build a number of LNG receiving terminals or FSRUs to cope with infrastructure problems in the distribution of gas throughout the archipelago.

Pertamina plans to convert the Arun LNG plant in Aceh into a receiving terminal. In addition, gas distributor PGN plans to build an FSRU in Lampung. (sat)