Gas exports seen to drop, domestic sales increase

Exports of natural gas from Indonesia are projected to decrease this year, while domestic sales are expected to increase, according to oil and gas upstream sector regulator BPMIGAS.

Based on contracts, domestic market is expected to be supplied with a total of 4,366 billion British thermal unit per day (BBTUD) this year, while gas exports will reach 3,322 BBUTD. These compare with last year?s realized domestic gas supplies that reached 4,342.71 BBUTD and last year?s exports that reached 4,311.58 BBUTD, BPMIGAS? spokesperson Elan Biantoro said.

?The portion of domestic sales to the national total gas sales will thus increase to 58.78 percent this year from around 50.18 percent last year. Meanwhile, the portion of exports will decrease to 43.22 percent from 49.82 percent,? Elan said.

?This is a significant increase,? he said.

Power plants consumed 854.88 BBUTD last year. This year, the power sector?s consumption is expected to increase to 1,520.6 BBUTD. Additional gas supplies are expected to come from Wortel field (operated by Santos), Sungai Kenawang field (Pertamina Talisman Jambi Merang JOB), Kampung Baru field (Energy Equity Sengkang), Jabung (PetroChina) and Singa field (Medco E&P).

Meanwhile, based on contracts that have been signed by gas producers or state owned gas distributor PT Perusahaan Gas Negara, manufacturing sector will be supplied with a total of 1,690.43 BBUTD this year, up from 1,203.18 BBUTD last year. Additional gas supplies will be sourced from Kalila Bentu and Pertamina PetroChina East Java JOB.

?BPMIGAS always urges gas producers to meet their contract commitment,? he said.

According to him, BPMIGAS has always pushed gas producers to prioritize the local market. But there is a problem related to the price. Local buyers can?t still afford gas at prices above US$5 per MMBTU, while many gas producers can?t sell their gas at lower price due to huge investment in finding and exploiting the gas.

He also said there is a problem related to the lack of infrastructure for gas transportation. Most of domestic gas buyers are located in Java and Sumatra, while most of gas fields are located on other islands, such as Sumatra, Borneo, Sulawesi, Papua and thus far there is only one pipeline network linking Java and Sumatra.

The infrastructure problem is expected to be solved with the development of floating storage regasification unit (RSFU) in some parts of the country, including offshore North Jakarta, that is able to take gas supplies in the form of LNG.

?The FSRU in the Jakarta Bay is expected to be completed in the fourth quarter of this year,? he said. (bernard/kanti)