Pertagas to try LNG for vehicle in Kalimantan

By Febry Silaban

PT Pertamina Gas (Pertagas) will try the use of LNG for vehicles in the coming weeks in East Kalimantan as a pilot project aimed to encourage vehicles using LNG rather than oil fuels on the long term.

?At the end of November or in early December, we shall launch ?LNG for vehicle? in Kalimantan,? Pertagas? President Director Hendra Jaya said on Friday.

In the first step, the LNG will be supplied heavy equipment used by coal mining companies in the region, such as PT Kaltim Prima Coal, PT Berau Coal and PT Arutmin Indonesia. The LNG will be sourced from the Badak LNG plant in Bontang with gas from the Mahakam block operated by French firm Total S.A.

?Since this is only a pilot project, the gas price is not a commercial one. We are seeking to negotiate with the operator of Mahakam block with approval from SKK Migas that some amount of gas allocated for Regas Satu FSRU can be used for this project,? he said.

The Regas Satu FSRU, operated by PT Nusantara Regas (60 percent owned by Pertamina), 40 percent by PT Perusaahaan Listrik Negara), is locate north of Jakarta.

Going forwad, he said, if the project is successful, Pertagas will propose SKK Migas allocate a larger amount of gas for the project so that the use of gas can be expanded to all miners in East Kalimantan and other regions.

?Certainly, in the beginning, the price of the gas will be relatively high. However, if the volume increases, the price can be reduced to lower than oil fuels,? he said.

Editing by Johannes Simbolon