Govt urged to blueprint gas supply for fertilizer makers

A senior House member has urged the government to issue a blueprint to guarantee adequate natural gas supply for the country?s fertilizer makers using it as raw material, Antara news service reported Friday.

With such government regulation, gas producers will no longer arbitrarily reduce gas supply for fertilizer producers, Irwan Prayitno, chairman of the House Commission VIII in charge of energy and mineral resources affairs, was quoted as saying.

?The government should be strict by issuing a blueprint on gas supply for fertilizer industries so that there will be no longer supply cut which inflicts a loss upon fertilizer producers,? the legislator said.

A number of fertilizer producers have suffered a shortage of gas supply due to the decline in the gas reserves while most of the existing gas production has been allocated for exports.

The current oil and gas law stipulates that at least 25 percent of gas produced by the country?s production sharing contractors must be sold domestically. Of the 25 percent allocation, seven percent goes to fertilizer producers while the remaining balance is for state electricity company PLN.

Indonesia currently has six fertilizer makers, and those suffering gas supply shortage include PT Pupuk Kaltim in East Kalimantan, PT Petrokimia Gresik (East Java), and PT Pupuk Iskandar Muda and PT ASEAN Aceh Fertilizer (Aceh).

Recently, the government asked ExxonMobil Oil Indonesia in Aceh to reallocate a larger part of its gas to fertilizer producer PT Pupuk Iskandar Muda and PT ASEAN Aceh Fertilizer.

The six fertilizer producers produce around 7.5 million tons of urea-based fertilizer. (*)