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Jakarta Post

PGN to increase use of natural gas in Pertamina’s oil refineries

  • News Desk

    The Jakarta Post

Jakarta   /   Wed, August 28, 2019   /   02:03 pm
PGN to increase use of natural gas in Pertamina’s oil refineries Engineers of Perusahaan Gas Negara (PGN) examine gas pipes to be installed to supply the Tambak Aji industrial estate in Semarang, Central Java. ( Sulistiyawan )

State-owned gas distributor PT Perusahaan Gas Negara (PGN) plans to strengthen its business by developing new infrastructure and changing the fuel used in oil refineries.

PGN corporate secretary Rachmat Hutama said the company was now building new transmission and distribution pipelines and is converting the fuel used by the oil refineries of its holding company, Pertamina, from oil to natural gas.

PGN is now building a 67-kilometer transmission pipeline from Duri in Riau province to supply gas to Pertamina’s refinery in Dumai and another 56-km of pipelines to distribute gas to industrial, commercial and household customers in Dumai, Pekanbaru and their surrounding areas.  

The construction of the pipelines are part of PGN’s plan to convert six of Pertamina’s refineries that are still using oil for fuel, namely the Dumai refinery in Riau, Balongan refinery in West Java, Cilacap refinery in Central Java, Tuban refinery in East Java, Balikpapan refinery in East Kalimantan and Kasim refinery in West Papua.

According to PGN, converting the fuel used by the refineries from oil to gas could help Indonesia reduce its oil imports. The conversion is targeted to complete next year.

The company was also prioritizing the development of infrastructure in areas with high demand from the electricity, industry, transportation and household sectors.

“Infrastructure is key for PGN to optimize the advantages of sustainable gas energy,” Rachmat said.

In order to meet the high demand in Central Java, for instance, PGN is installing a 267-km pipeline to Semarang from Gresik in East Java through the Jambaran-Tiung Biru gas field in Cepu, Central Java.

Afterwards, the company is to build about 96 km of distribution pipelines to supply natural gas to customers in Semarang, Kendal, Ungaran and their surrounding areas.

Meanwhile, PGN is building a liquified natural gas (LNG) terminal in East Java with a capacity of 40 billion British thermal units per day (bbtud) to increase the reliability and sustainability of gas supply in the province.

In the future, PGN would connect the trans-Java pipelines to Sumatra, Rachmat said.

Furthermore, the company plans to complete the construction of new infrastructure, including 500 km of distribution pipelines, 528 km of transmission pipelines, seven LNG filling stations for trucks and ships, five floating storage and regasification units, distribution pipelines for 3.59 million households and 17 LNG terminals across the country by the end of 2024. (asp)