Java may face shortage of gas supply in 2002-2003

Java island may face a shortage of natural gas supply beginning 2002 or 2003 if no new gas resources are developed before the period, according to Pertamina.

Pertamina?s director for upstream industry, Iin Arifin Takhyan, said in Jakarta on Wednesday that finding a new gas supply from outside the island such as from South Sumatra would be therefore needed to cope with the gas supply shortage.

According him, the plan to develop a undersea pipeline network to get a gas supply from South Sumatra would be the best alternative to face the gas shortage, and it should therefore be realized as soon as possible.

?Developing an undersea pipeline network to get a gas supply from South Sumatra is urgent in solving the lack of the gas supply in Java,? he was quoted as saying by Neraca daily.

Iin said that developing a new gas resource is not yet as competitive as oil because the later is still subsidized by the government. But in the future, gas development will be as promising as oil especially after the oil subsidy is totally removed.

He said that Pertamina was studying a new gas price formula to encourage gas development.

At present, Pertamina produces about 800 million cubic feet of gas, most of which are sold to state owned electricity company PLN, fertilizer producers and other industries such as steel mills.

Indonesia has gas reserves of about 158.5 trillion cubic feet (TFC) in 2000, about 94.4 TCF of the total are proven deposits, with an average daily production of 8.5 billion cubic feet. The total gas reserves will last for about 50 years.(*)