PGN GAINING MOMENTUM TO INCREASE GAS SALES

by Andi Abdussalam

Jakarta, March 16 (Antara) - State-owned gas distributor company PGN is gaining momentum to increase its sales following the upward trend in coal prices which have exceeded US$100 per tonne.          According to PGN Corporate Secretary Rachmat Hutama, the gas product of the company could become an alternative to coal consumers such as power generators following the increase in the coal prices.   As a result, PGN is ready to meet the increasing demand for gas supplies from power plants amid the rising prices.          Coal prices have continued to rise in recent months with high demand across Asian nations such as China, India and Vietnam. In the face of increasing prices, the government has also raised its coal benchmark price (HBA).          According to data from the Energy and Mineral Resources Ministry on Thursday (March 8), the HBA for coal was set at $101.86 per tonne for March, 2018. It is an increase of 1.16 percent from $100.69 per tonne in February.          The rise in coal prices could lead power companies to switch to natural gas. PGN is currently continuing to work with state-owned electricity firm PLN to meet the gas supply needs for power plants.

GRID CONNECTIONS PROVIDE CHEAPER GAS

by Andi Abdussalam

Jakarta, Aug 10 (Antara) - The government has been successful in carrying out its kerosene-to-gas conversion programs launched for household consumers over the past few years.          Households now use liquefied petroleum gas (LPG) in different cylinder sizes. For economically weak households, subsidized LPG in 3-kilogram cylinders is available, while other households have non-subsidized LPG 12-kilogram cylinders.           In addition, the government has since 2009 launched a relatively cheaper gas program in gas grid connections for households, but the number of consumers who obtained the connections was still very small. In the period between 2009 and 2016, only some 185,991 household consumers were connected to the gas grid program.          Therefore, the government is determined to expand the networks of its gas connections for household consumers this year. After all, consumers who obtain gas through the network connections can receive gas at a cheaper price.          "The people can save as much as Rp90 thousand per month, as they use the gas for household purposes. When people use the 3-kilogram subsidized LPG in cylinders, they will spend Rp130 thousand per month," Energy and Mineral Resources Minister Ignasius Jonan said in a written statement on Saturday (Aug 5).

59 THOUSAND HOUSEHOLDS TO GET GAS CONNECTIONS IN 2017

by Andi Abdussalam

Jakarta, May 9 (Antara) - After building gas pipeline network connections for 89 household consumers last year, the government is planning another gas network, which will connect 59 households in 2017.          In addition, Energy and Mineral Resources Ignasius Jonan has also promised to build additional household gas connections, with funds taken from the tank storage allocation funds amounting to Rp190 billion.      "Some of the funds for the development of the gas pipeline network will be taken from the 2017 state budget amounting to Rp190 billion," Jonan said in Surabaya, East Java, while inaugurating the operation of a gas pipeline, which connects 24 thousand household customers at Penjaringan Sari Flat, Surabaya, East Java, on Sunday (May 7).            According to Jonan, with the assumption that one connection will cost Rp10 million to develop, the Rp190 billion funds will enable the development of a gas network which connects some 19 thousand connections for households in a number of regions.

ENTREPRENEURS GROWLING AT GAS MAFIA

by Andi Abdussalam

Jakarta, Sept 10 (Antara) - Young entrepreneurs have asked the government to investigate the alleged involvement of the mafia in gas distribution that causes its price to soar two-fold when it reaches downstream industries.          The upstream industry gas price is only about US$4 per million metric British thermal unit (mmbtu). But when it reaches downstream industries, it rises to about US$9 to US$14 per mmbtu.     In Singapore, it is only US$4 to US$5 per mmbtu.          The other factor that cause prices to increase is the monopolistic business practices that create brokerage.          The monopolistic practice in gas distribution triggers the presence of brokerage and high gas price for the industry in the country, according to the Central Board of the Indonesian Young Entrepreneurs Association (Hipmi).          "We found monopoly in gas distribution and incompetent gas brokers," Chairman of Hipmi for Energy Affairs Andhika Anindyaguna stated in a release in Jakarta, Wednesday (September 7).          In the meantime, the government, through the Ministry of Industry, is trying to offer a special price to industries in an effort to reduce the soaring gas price in the downstream sector.

NEW GAS REGULATION EXPECTED TO BOOST GROWTH

By Andi Abdussalam

Jakarta, May 26 (Antara) - The government has issued a new ruling in the form of Presidential Regulation (Perpres) No. 40/2016 on gas price adjustment to boost economic growth and increase the consumption of gas at home.          The new ruling is also expected to add to the national industry's competitive edge through effective and efficient gas supplies.          The Upstream Oil and Gas Regulatory Special Task Force (SKK Migas) welcomed the signing of Presidential Regulation No.40/2016 on Natural Gas Price.          SKK Migas Deputy Chairman Zikrullah said on Thursday (May 19) that the new regulation, facilitating price adjustments, is expected to increase downstream gas consumption.          "I have heard that the Presidential Regulation (Perpres) on gas pricing has been issued. This means that downstream gas consumption will increase as there will be a price adjustment," Zikrullah said.

GOVT CUTS GAS PRICES FOR 7 CONSUMER INDUSTRIES

By Andi Abdussalam

Jakarta, May 19 (Antara) - Amidst complaints of low gas consumption at home and an increase in the commodity's export, the government has cuts prices of gas for seven types of industries.          The lowering of gas prices for industries was announced as part of a presidential regulation on gas prices signed by President Joko Widodo (Jokowi) on May 3.          The seven industrial sectors, which will benefit from the lowered gas prices, are the fertilizer industry, petrochemicals, oleo chemicals, steel, ceramics, glass and rubber gloves.          However, the regulation does not mention the power generation sector, which also enjoys a gas price cut.          "I had heard that the Presidential Regulation (Perpres) on gas prices has been issued. This means that the downstream gas consumption will increase as there will be a price adjustment,"  Upstream Oil and Gas Regulatory Special Task Force (SKK Migas) Deputy Head, Zikrullah said in Jakarta on Thursday.          He further stated that SKK Migas welcomed the Presidential Regulation on Natural Gas Prices. According to Zikrullah, the new regulation is expected to increase downstream gas consumption as the new ruling contains price adjustments.

MALUKU RESIDENTS WELCOME PLAN TO BUILD MASELA LNG REFINERY ONSHORE

By Andi Abdussalam

Jakarta, March 24 (Antara) - Maluku residents have expressed their happiness over President Joko Widodo's (Jokowi's) decision to build the country's largest onshore Masela gas refinery in the Maluku Province after much deliberation on whether it should be built onshore or offshore.          Local society leaders and academicians lauded the president's decision to build the Masela Block¿s liquefied natural gas (LNG) refinery plant onshore. They expressed happiness when contacted by the Antara National News Agency on Wednesday.          Statements of happiness were voiced by among others, the Director of the Archipelago Solidarity Foundation Engelina Pattiasina, Pattimura University Rector Saptenno, Darussalam University Rector Ibrahim Ohorella and noted Southwest Maluku society figure A Watloly.          "We thank President Jokowi and the Coordinating Minister for Maritime Affairs, Rizal Ramli because they complied with the aspirations of the Maluku people. The decision is good, not only for the prosperity of the Maluku people, but also for the people of Indonesia," said Engelina.          She said the decision is also in line with Article 33 of the 1945 Constitution. "Oil and gas industry may not be developed, only based on a profit-loss oriented calculation, but also based on its impact on the people."

PGN EXPANDS NETWORK TO INCREASE GAS UTILIZATION EFFICIENCY

by Andi Abdussalam

Jakarta, March 18 (Antara) - State-owned gas distributor company PGN has continued to expand its infrastructure network in an effort to increase efficiency and utilize the natural gas produced in the country.          The state-owned company's infrastructure facilities include the development of a mini-liquefied natural gas (mini-LNG) system, expansion of the gas pipeline network, and increase in the number of household consumer connections.          PGN President Director Hendi Prio Santoso stated on Wednesday that additional infrastructure such as pipelines, mini-LNG system, and connections to household consumers will increase the utilization of the nation's natural gas to 1,902 million standard cubic feet per day (mmscfd).         "With that volume, PGN will be able to save Rp110.9 trillion. Last year, through its gas distribution to consumers, PGN was able to save on Rp88.03 trillion," noted Hendi.          He affirmed that his company will build a mini-LNG system in the eastern regions of Indonesia and increase the number of its gas refueling stations (SPBGs) for land transportation. From now until 2019, PGN plans to build 60 SPBGs.

GOVERNMENT YET TO DECIDE MASELA GAS REFINERY LOCATION

by Andi Abdussalam

Jakarta, March 10 (Antara) - As of this week, the government has not yet decided whether to develop an onshore or offshore liquefied natural gas refinery at the Abadi natural gas field, Masela Block, in Arafura Sea, Maluku Province.          President Joko Widodo (Jokowi) has not decided upon a location for the LNG refinery plant, following controversies over the economics and costs involved in the construction of an onshore or offshore refinery.          "There is no final figure yet. We are still waiting for the calculation of real and accurate figures for the construction costs of the Masela gas refinery, both onshore and offshore," Amien Sunaryadi, the head of the Upstream Oil and Gas Regulator (SKK Migas) said following a hearing with the Regional Representative Council (DPD) on Monday (March 7).          There have been differences in construction cost calculations between Coordinating Minister for Maritime Affairs Rizal Ramli and project contractor Inpex Corp of Japan and its partner, Royal Dutch Shell.       Rizal Ramli said, based on his study, the cost of developing an onshore refinery would be some US$16 billion, while the cost for developing it offshore would reach US$22 billion.          He added that the calculation was far different from the cost estimates provided by Japan's Inpex Corp and Shell, which are set at US$14.8 billion for the offshore and US$19.3 billion for the onshore refinery.

GOVT ASKED TO LOWER GAS PRICES

by Andi Abdussalam

Jakarta, Feb 6 (Antara) -  In line with the downward trend in the world oil prices, the industrial sector has called on the government to reduce the price of gas at home to ensure that their products remain competitive.         At least two associations representing the industry made the appeal, namely the Indonesian Chemical Industries Federation (FIKI) and the Indonesian Olefin and Plastic Association (INAPLAS).         "The government needs to adjust the gas prices in step with the world price trend. The price of gas is now going down in the world," Ridwan Adipoetra, secretary general of the FIKI, said here on Wednesday (Feb 3).          He said the world crude price has now dropped 75 percent to US$30 per barrel. Accordingly, the government lowered the prices of fuels through its third economic policy package. Unfortunately, the price of gas has not yet been lowered.          If this state of affairs was allowed to continue, it will make chemical industries at home difficult to compete.  The gas price has been adjusted only for the fertilizer industry where the government has lowered it from US$10 per 1 million British  thermal units (mmbtu)  to US$7 per 1 mmbtu.

PERTAMINA LAUNCHES 5.5-KG GAS VARIANT

By Andi Abdussalam

Jakarta, Oct 24 (Antara) - State-owned oil and gas company, Pertamina has launched a new gas variant, Bright Gas, in 5.5-kilogram cylinders of liquefied petroleum gas (LPG) which is expected to attract 23 percent of subsidized gas consumers.          Pertamina's target in the launch of the non-subsidized Bright Gas, is to attract 23 percent per annum of subsidized LPG consumers so that it would reduce the government's burden in providing subsidies to LPG gas, particularly the consumers of subsidized 3-kg gas cylinders.          "Our concept is to attract 23 percent of subsidized gas consumers to non-subsidized Bright Gas in 5.5-kg cylinders. That is our target," Pertamina's Marketing Director Ahmad Bambang said when launching the Bright Gas 5.5-kg cylinders in Jakarta Friday (October 23).          Beginning next month (November 2015), Bright Gas will be developed and its market will be expanded to the Jakarta, Depok, Tangerang, Bekasi (Jabodetabek) regions through the Pertamina LPG dealers, 54 Pertamina Refilling Stations (SPBU) and 150 outlets in minimarkets, he said.

PERTAMINA READY TO MARKET 5.5-KG LPG CYLINDERS

By Andi Abdussalam           Jakarta, Sept 19 (Antara) - State-owned oil and gas company Pertamina is now ready to market its 5.5-kilogram (kg) cylinders of liquefied petroleum gas (LPG) in Jakarta and its satellite towns of Depok, Tangerang, and Bekasi from October 1, 2015.          "The 5.5-kg LPG cylinders will be officially launched on October 1, 2015. They will be sold only in Jakarta and its satellite towns of Depok, Tangerang, and Bekasi (Jadetabek)," External Relations Manager of PT Pertamina's Marketing Operations for Region IV (Central Java and Yogyakara), Roberth M.V. Dumatubun, stated in Semarang, Central Java, on Friday.           According to Pertamina's plan, the target consumers of the 5.5-kg LPG cylinders are the middle and upper class people such as apartment residents who do not consume LPG in large volumes.          "Apartment residents are a market segment and rarely carry out cooking activities. For apartments, particularly with women residents, the 5.5-kg LPG cylinders are suitable as the apartment residents can carry the cylinders themselves since they are not too heavy such as the 12-kg variant," he noted.          The non-subsidized 5.5-kg LPG cylinders, which are packed similar to the 12-kg sized Bright gas cylinder, will be sold at a price of Rp80 thousand per cylinder.

SPECULATORS CAUSE GAS PRICE RISE IN VARIOUS REGIONS

By Andi Abdussalam
Jakarta, Feb 27 (Antara) - Amid the increasing rice prices due to alleged acts of rice mafia, the price of three-kilogram cylinders of liquefied petroleum gas (LPG) is also on the rise in various regions.         The increase in prices of these two commodities are not caused by the shortage of stocks in the market but allegedly caused by distributors or retailers who have orchestrated the conditions to reap more benefits.          In reality, when state-owned oil and gas company Pertamina conducted market operations, it was found that there was no scarcity of stocks in the field.         Thus, the shortage of LPG in several regions is believed to be caused by retailers who are deliberately withholding gas stocks, noted Ahmad Bambang, the marketing director of state-owned oil and gas company Pertamina.         "Retailers want to make more profits by creating a situation that gives the impression that Pertamina has been holding back its stocks," he stated here on Thursday.          After launching market operations, Pertamina has uncovered that only 10 percent of the gas offered during the operations was sold.

12-KILOGRAM LPG CUSTOMERS MAY SWITCH TO USING 3-KILOGRAM GAS

By Andi Abdussalam
Jakarta, Jan 8 (Antara) - It is feared that consumers of unsubsidized 12-kilogram cylinders of liquefied petroleum gas (LPG) will switch to using the subsidized 3-kilogram LPG canisters after state-owned oil and gas firm Pertamina raised the price of the former.          Pertamina raised the price of 12-kilogram canisters of gas to Rp18,000 per cylinder, or some Rp1,500 per kilogram, on January 2.          The price of gas was raised in stages in an effort to reach its economic viability after Pertamina sold it below the market price and suffered losses for long.          With the hike, the price of 12-kilogram cylinders of gas in Jakarta and its vicinity rose from Rp120,000 to Rp140,000.          Therefore, it is feared that the increase in the price of the 12-kilogram gas canisters will boost the migration of customers using them to the subsidized 3-kilogram ones, which was designed by the government for financially weak consumers.          Pertamina has laid a gradual price increase roadmap for its LPG in an effort to reach an economically viable gas price at about Rp11,944 per kilogram by mid-2016.          According to the roadmap, Pertamina planned to gradually increase the price of 12-kilogram LPG cylinders by Rp1,000 per kilogram on July 1, 2014, and by Rp1,500 per kilogram during the first and second semesters of 2015 and 2016.

GOVT GAINS MOMENTUM TO PROMOTE USE OF GAS

By Andi Abdussalam
Jakarta, Dec 7 (Antara) - The recent government's decision to raise subsidized fuel oil prices virtually earns it a momentum to promote its oil-to-gas conversion program for transportation as it creates a big margin between gas and fuel oil prices.          "The price per liter of premium (gasoline) equivalent gas is only Rp3,100, far lower than the price per liter of premium gasoline sold at Rp8,500 and that of diesel oil at Rp7,500. With a far price difference, consumers will be attracted to use gas for their vehicles and that gas will become an alternative energy for the people," Irwan Andri, the spokesman of state-owned gas distributor firm PGN, said on Sunday.          Therefore, the PGN is ready to help the government develop and promote the use of gas in the transportation sector and is ready to increase the number of its gas refueling stations (SPBG) to support the government's fuel oil-to-gas conversion program.          Irwan Andri said his company was optimistic that fuel oil-to-gas conversion would develop following the government's decision to raise subsidized fuel prices on November 18, 2014.          "The increase in the fuel oil prices will encourage consumers to switch to using gas," he said.

PERTAMINA AIMS TO ACHIEVE VIABLE GAS PRICE BY MID-2016

By Andi Abdussalam

         Jakarta, Sept 10 (Antara) - State-owned oil and gas company Pertamina has laid a gradual price increase roadmap for its liquefied petroleum gas (LPG) in an effort to reach economically viable gas price at about Rp11,944 per kilogram by mid-2016.
         Based on the roadmap, Pertamina will gradually increase the price for consumers of LPG in 12-kilogram cylinders by Rp1 thousand per kilogram on July 1, 2014, and by Rp1,500 per kilogram during the first and second semesters of 2015 and 2016.
         However, Pertamina had to put on hold its plan to raise LPG price on July 1, 2014, because it coincided with the fasting month of Ramadhan and Idul Fitri festivities during which the demand for LPG rises. 
    The oil company again postponed another plan to raise it on August 15, 2014, after it received a letter from the Coordinating Ministry for Economic Affairs Chairul Tanjung asking the company to put price rise on hold.  

WILL PERTAMINA BENEFIT FROM ITS ACQUISITION OF PGN?

By Andi Abdussalam
Jakarta, Jan 21 (Antara) - State-owned oil and gas company Pertamina's plan to acquire state gas distributor firm PGN is under government evaluation, though it was earlier reported that the government has agreed to it.          "There is no final statement from the government about its agreement to the acquisition. The government only agreed to carry out evaluations to study the best option," stated Finance Deputy Minister Bambang Brodjonegoro on Friday.          It was earlier reported that the government had agreed to PT Pertamina's plan to acquire PT PGN, asking the state-owned oil and gas company to present an evaluation on its corporate action plan.          It was actually an agreement to conduct an evaluation of Pertamina's acquisition plan, which was decided upon during a meeting between State-owned Enterprise Minister Dahlan Iskan and the Board of Directors and Commissioners of Pertamina, early this month.      If the government finally agrees to the acquisition, will Pertamina benefit from the corporate action?

PERTAMINA URGED TO REVIEW GAS PRICE HIKE

By Andi Abdussalam
Jakarta, Jan 4 (Antara) - The government and state-owned oil and gas company Pertamina has been called on to review a decision made by Pertamina to raise the price of non-subsidized gas in 12-kg cylinders by 68 percent.          Secretary of the Great Indonesian Movement Party (Gerindra) Faction in the House of Representatives (DPR), Edhy Prabowo, said the increase of liquefied petroleum gas (LGP) in 12-kg cylinders placed a heavy burden on the public.          "We have received a lot of complaints from the people. They have to bear heavy burdens as a result of the increase of non-subsidized gas," Prabowo stated on Saturday.          Therefore, he called on the government, in this case Chief Economic Minister Hattar Rajasa, State Enterprise Minister Dahlan Iskan and Pertamina President Director Karen Agustiawan, to review the decision to increase the price of LPG gas.          "The government should not hike prices at will, which will add to the people's burdens," he said.          Pertamina has hiked the selling price of non-subsidized 12-kg cylinders of liquefied petroleum gas by about 68 percent, effective January 1, 2014. Deputy President of Pertamina's Communications Affairs Ali Mundakir reported Wednesday that his company had raised the price in an effort to shore up Pertamina's losses in the 12-kg cylinder gas business, which reached about Rp6 trillion in 2013.

RI OIL PRODUCTION STILL BELOW TARGET

By Andi Abdussalam

Jakarta, March 19 (Antara) - Indonesia's average oil and condensate production up to the first week of March was recorded at 827.200 barrels per day (bpd), below the target set in the 2013 state budget at 900,000 bpd.          However its average natural gas production up to the same period has reached 8,196 million metric standard cubic feet (mmscfd), above the target set in the 2013 state budget at 7,890 mmscfd.          If oil and gas are taken together, Indonesia's average oil and gas production up to the first week of March has reached 2.29 million oil-equivalent barrels per day, slightly above the state budget target at 2.26 million oil-equivalent barrels per day.          The Upstream Oil and Gas Regulatory Task Force (SKK-Migas) has earlier predicted that the realistic calculation for Indonesia's average oil production in 2013 should be set at between 830,000 and 850,000 bpd, and its average gas production at 6,939 mmscfd or 1.24 million oil-equivalent barrels per day.          Thus, the realistic average oil and gas production for 2013, according to SKK-Migas should be set at between 2.07 and 2.09 million oil-equivalent barrels per day.

GOVT POSTPONES GAS PRICE HIKE TO OFFSET INFLATION

By Andi Abdussalam

Jakarta, March 12 (Antara) - The government's decision to postpone state-owned oil and gas firm Pertamina's plan to increase gas price in 12-kg cylinders this month can help offset inflation that has been high since early this year.          "The postponement of raising the price of liquefied petroleum gas (LPG) in 12-kg cylinders is good. We believe it would curb the inflation rate in March and April," Bambang Brodjonegoro, acting head of the Finance Ministry's fiscal policy affairs, said.          University of Indonesia's economist Lana Soelistianingsih shared Bambang's view, saying that the government decision to postpone the LPG price increase would cut inflation potential by 0.5 percent.          "If the government goes on with  Pertamina's planned gas price hike, it would contribute multiple inflationary pressures to the economy because prices of food commodities such as onions, garlic, chili and other horticultural products have been skyrocketing. The deferment of the gas price hike will reduce the increasing inflation in the past two months," Lana Soelistianingsih.