Govt mulls measures to cut domestic gas price

By Bernard Loebs

The government is mulling several measures to cut the price of natural gas on the domestic market, Director General of Oil and Gas IGN Wiratmaja said on Tuesday.

One of the measures is cutting the government?s take from gas production. This is part of President Joko Widodo?s Phase I Economic Policy Package announced several months ago.

?There are as many as 31 gas supply from oil and gas contractors across the country where the government?s take is being studied for reduction. We assure the contractor?s take will remain unchanged,? he said.

The other measure is to reduce the toll fee of the gas pipeline. This can be done through two alternatives, that is first, reimbursing the investment costs of the owners of the existing gas pipelines (state owned oil and gas firms PT Pertamina, PT Perusahaan Gas Negara (PGN) and others) to develop the pipelines; second, building pipelines using the state budget in the areas which are considered uneconomical.

He said the government is proposing to the House of Representatives? Commission VII the allocation of state budget amounting to Rp 18 trillion next year for the development of gas infrastructures, either pipelines or regasification facilities.

Editing by Johannes Simbolon