Ceramic producers look for substitution to natural gas
Wednesday, May 23 2001 - 08:30 AM WIB
Domestic ceramic producers are likely to look for fuel substitutions to natural gas following the decision from state gas company PT Perusahaan Gas Negara (PGN) to charge an increased transportation toll fee of Rp 260 (US$ = 11,400) per cubic meter of gas, Bisnis Indonesia daily reported on Wednesday.
The head of the Indonesian Ceramic Association (ASAKI), Johan Silitonga, told the daily that some ceramic producers were currently considering of using other fuels such as diesel oil in its production process because of the increasing costs of gas use.
"Technically, it is possible although we have to re-install a number of plant machinery," Johan said.
Nevertheless, Johan acknowledged that using natural gas would produce the best end products of ceramic.
He noted that ceramic producers had met with PGN last week, and expressed their reluctance to pay the toll fee, but PGN insisted that in any case it would charge the increased toll fee to customers especially in Greater Jakarta Area.
"They (PGN) contended that such a tariff constitutes as a blended cost, set by (state oil and gas company) Pertamina and (its contractor) ARCO," Johan said.
PGN, according to Johan, also contended that the previous toll fee of Rp 154 per cubic meter of gas was based on the old rupiah's exchange rate of Rp 2,500 against the U.S. dollar.
Nevertheless, Johan said that PGN would charge the higher toll fee to ceramic producers in Greater Jakarta and West Java only, where demands for natural gas exceed PGN's capacity to supply.
"They (PGN) said that for East Java and its surrounding areas, the toll fee would be cheaper," Johan said, contending that gas demand in East Java were lower than that in West Java and Greater Jakarta area. (*)