Gas price for petrochemical industry set at below $6 per mmbtu

The government has finally started realizing its promise to lower gas price for selected industries. The Directorate General of Oil and Gas at the Ministry of Energy and Mineral Resources announced on Wednesday that the gas price for petrochemical industry has been set at below US$6 per mmbtu.

The directorate said in a statement that the government needs to make further discussions before deciding gas price for fertilizer and steel industries.

President Joko Widodo in early May issued Presidential Regulation No 40/2016 on lower gas price for selected industries such as fertilizer, petrochemical, oleo chemical, steel, ceramics, gloves, and glassware to help improve their competitiveness. The president has suggested gas price for industries to be lower than $6 per mmbtu.

Minister of Industry Airlangga Hartarto said in October that the government has identified 10 industries and one industrial estate to be eligible to the lower gas price.

Meanwhile, Minister of Energy and Mineral Resources Ignasius Jonan said that calculation on gas price for other industries is expected to be entirely completed by the end of November so that it can be implemented early next year.

Editing by Reiner Simanjuntak