Pertamina to import more LPG to meet domestic consumption

State oil and gas firm PT Pertamina is in negotiation with several foreign oil and gas firms, including a company in Qatar,  Itochu Corp., BP and ConocoPhillips on the planned import of 500,000 tons of liquefied petroleum gas (LPG) to meet domestic consumption next year.

 

Pertamina’s deputy director for marketing Hanung Budya said in Jakarta Tuesday that the demand for LPG has shown an increasing trend due to the ongoing government’s program to replace the consumption of kerosene to that of LPG, which has led Pertamina to import more LPG to meet the demand.

 

Demand for LPG is expected to reach 1.9 million tons next year. Out of the total LPG need, around 1.4 million tons can be supplied by companies operating under the production sharing contract, such as Medco  Energi International, PetroChina, Chevron, Trans Pacific Petrochemical Indotama (TPPI) and Pertamina.

 

Out of the total LPG need next year, at least 800,000 tons will be used to meet the subsidized LPG-kerosene conversion program and 1.1 million tons for non-subsidized LPG-kerosene conversion program.

 

According to Hanung, with the government expected to cut the kerosene consumption by 1 million tons next year, at least more 500,000 tons of LPG will be needed.

 

Pertamina has set the target of converting 70 percent kerosene consumption to LPG throughout Indonesia up to 2010.

 

The government has expressed the hope that the oil and gas companies operating under the production sharing contract to boost their gas output to meet the increasing demand. “TPPI, for is instance, is expected to be able to provide more gas supplies of up to 150,000 tons,” Hanung said. (godang)