Govt asked to allocate 8 percent of gas output to fertilizer plants

The commission III of the House of Representatives (DPR) has asked the government to allocate between seven and eight percent of the country?s annual gas production to fertilizer producers, Bisnis Indonesia reported on Thursday.

The commission?s chairman Awal Kusumah said in Jakarta on Wednesday that such a policy was important to curb possible shortage of fertilizer supply to the country?s farmers.

He said that at present, the supply of gas to the country?s fertilizer producers was only between 70 percent and 80 percent of their actual needs. As the consequence, much fertilizer producers failed to meet their production target.

Awal said that the commission would soon send a letter to the ministry of energy and mineral resources to take an immediate action in coping with the shortage of gas supply to fertilizer producers.

?It is important, if the gas shortage continues, it will affect the country?s rice production,? he said.

Earlier reports had said that many gas producers preferred to export their gas to take the advantage of the higher price in the international markets. The price of gas sold to fertilizer is based on the government?s price reference, and it is often far below the international prices. (*)