Gas for exports can be shifted to domestic market

The government is considering introducing a new clausal in contracts for gas export through pipeline which will allow it to shift gas for exports into the domestic market to ensure sufficient gas supply at home, Kompas reported on Wednesday.

The director general of oil and gas at the ministry of energy and mineral resources Luluk Sumiarso said in Jakarta on Tuesday that the clausal would be added into a new or extended contract given to gas producers.

He said that the government would, for example, try to add such a clausal on the contract recently signed by British energy firm Premier Oil and partners for gas exports from Natuna Sea Block A PSC through a pipeline to Singapore.

In April this year, Premier Oil signed the three contracts with Sembcorp Gas Pte Ltd. (Sembcorp), PT Pelayanan Listrik Nasional Batam (PLN) and PT Universal Batam Energy (UBE) respectively for a total volume of 125 billion British thermal units (BBTU) per day with options for a further 13 BBTU per day.

According to him, the gas exported by Premier Oil could be diverted to the domestic market through a pipeline which connects Sumatra and Singapore.

Lukuk said that the government would further increase the portion of gas production for domestic market to between 40 percent and 50 percent from about 30 percent at present to meet the growing gas demand at home.

Indonesia mainly exports gas to Japan, South Korea, and Taiwan in the form of liquifed natural gas (LNG) but delivers some of its gas to Singapore and Malaysia through pipeline from Natuna Sea and Sumatra.(*)