Pertamina to expand CNG business

State-owned oil and gas company PT Pertamina will continue to expand its gas-for-transportation business, or compressed natural gas (CNG), as part of its efforts to convert more fossil fuels (BBM) to gas.

?At present, Pertamina operates 8 gas filling stations in Greater Jakarta,? said President Director Karen Agustiawan during the 2011 Go Gas conference in Jakarta.

Pertamina?s involvement in this business started in 1986, when the government determined CNG as an alternative fuel for transportation.

The government?s move boosted the number of gas-enable vehicles, or natural gas vehicle (NGV), which peaked in 2000 when NGV reached 6.600 units. However, the prolonged fuel subsidy ? which makes CNG less attractive ? and other obstacles have hampered the development of CNG. In 2006, NGV reached only 500 units.

Still, Karen sees the business as an attractive one. Today, vehicle population reaches over 6 million for private vehicles, 4 million trucks, 2 million buses and 110,000 public transportations. ?All represent a big potential as gas users,? she said.

?Moreover, fuel subsidy has been increasing over the years and become a heavy burden on the government,? said Karen.

To help develop this downstream business, Pertamina expects the government to tightly monitor the implementation of a Ministerial Decree No. 19/2010 that requires upstream gas producers to allocate 40% of their domestic market obligation (DMO) for fulfilling the gas need for the transportation sector.

According to Karen, Pertamina is the only producer that has met that requirement. ?We therefore hope a tighter monitoring from the government.? (godang/edi)