Per­tam­ina, PGN join hands to sup­ply LNG in cen­tral RI

The Jakarta Post - - BUSINESS - Viriya P. Sing­gih

PLN needs more LNG from Per­tam­ina and PGN Per­tam­ina and PGN will de­velop var­i­ous LNG in­fra­struc­tures

State-owned en­ergy com­pa­nies PT Perusa­haan Gas Ne­gara (PGN) and Per­tam­ina are set to join forces to sup­ply liq­ue­fied nat­u­ral gas (LNG) to var­i­ous power plants op­er­ated by state elec­tric­ity firm PLN in the cen­tral part of In­done­sia.

In 2015, PLN started the ten­der process for the de­vel­op­ment of LNG in­fra­struc­tures and the pro­cure­ment of 230 mil­lion stan­dard cu­bic feet per day (MMSCFD) of LNG for its 32 gas-fu­eled power plants in Kal­i­man­tan, Su­lawesi and East Nusa Teng­gara (NTT) is­lands. Those fa­cil­i­ties were ex­pected to have a to­tal ca­pac­ity of 2,800 megawatts (MW).

How­ever, PLN even­tu­ally de­layed the ten­der fol­low­ing its de­ci­sion to make sev­eral ad­just­ments such as ex­clud­ing power plants in Bali, Gorontalo and Pon­tianak to make the project more ef­fi­cient. As a re­sult, the to­tal sup­ply of LNG sought by PLN was re­duced to 200 MMSCFD.

PLN has awarded the ten­der to PGN and Per­tam­ina, which will es­tab­lish a con­sor­tium to de­velop var­i­ous LNG in­fra­struc­tures, in­clud­ing stor­age and re­gasi­fi­ca­tion fa­cil­i­ties, un­der the build-op­er­ate-trans­fer (BOT) scheme and pro­cure small-to-medium car­ri­ers to trans­port the LNG.

“PGN and Per­tam­ina have dis­cussed the in­vest­ment needed for the project. Now we just have to wait for the eval­u­a­tion from PLN,” PGN pres­i­dent di­rec­tor Jobi Tri­ananda Hasjim said re­cently with­out dis­clos­ing the in­vest­ment fig­ure.

“We are still con­sid­er­ing whether to buy new LNG car­ri­ers or uti­lize the ex­ist­ing ones be­cause the in­vest­ment needed for such fa­cil­i­ties is not cheap. It is also pos­si­ble for us to team up with pri­vate in­vestors to pro­cure the car­ri­ers.”

Jobi said cen­tral and east In­done­sia were in­ter­est­ing mar­kets for PGN be­cause, as of to­day, peo­ple in those re­gions still re­lied heav­ily on liq­ue­fied pe­tro­leum gas (LPG) that was more ex­pen­sive com­pared to LNG.

How­ever, PGN can only pen­e­trate those mar­kets if there is an “an­chor buyer” like PLN that will en­sure a long-term mas­sive de­mand for LNG.

That is why PGN has sub­mit­ted a num­ber of ten­der bids for con­tracts with PLN, in­clud­ing for the de­vel­op­ment of LNG in­fra­struc­ture in Bangka Beli­tung, Pon­tianak and Nias to sup­ply LNG to six power plants in those three re­gions with ca­pac­i­ties rang­ing from 25 MW to 100 MW each.

“For in­stance, when we are able to sup­ply LNG to Pon­tianak [in West Kal­i­man­tan], the de­mand for in­dus­trial gas in the re­gion will also in­crease, so will the de­mand for gas from com­mer­cial and house­hold sec­tors,” Jobi said.

Per­tam­ina also signed on Thurs­day a gas sales agree­ment with PLN to sup­ply LNG for the lat­ter’s gas-fu­eled power plants in Sam­bera, East Kal­i­man­tan, with a ca­pac­ity of 2 x 20 MW.

The agree­ment will pave the way for Per­tam­ina to sup­ply 7.9 MMSCFD of LNG within five years start­ing from April 2018. There­fore, the firm will pre­pare the re­gasi­fi­ca­tion fa­cil­i­ties and at least 20 ISO ship­ping con­tain­ers to trans­port the LNG.

“This kind of LNG trans­porta­tion sys­tem will help us pen­e­trate re­mote ar­eas that have yet to be reached by pipe­lines, as well as sup­port the gov­ern­ment’s 35,000 MW elec­tric­ity pro­gram,” Per­tam­ina gas di­rec­tor Yenni An­dayani said.

Fur­ther­more, when the in­dus­trial and com­mer­cial mar­kets as well as the in­fra­struc­ture have been de­vel­oped in re­mote re­gions, it will be eas­ier for PGN and Per­tam­ina to build more city gas net­works as man­dated by the gov­ern­ment.

Newspapers in English

Newspapers from Indonesia

© PressReader. All rights reserved.