PGN expects lower gas price to increase sales volume
Friday, May 5 2017 - 03:56 AM WIB
IDX-listed gas distribution company PT PGN Tbk expects a cut in price of gas for industries such as in North Sumatra will help accelerate industry growth, which in turn would help increase gas sales volume.
This was said by Danny Praditya, Commercial Director of PGN, on Thursday. ?The (gas) price review is expected to drive industry (growth) and we?ll get compensation from growth in (gas sales) volume,? he said.
Danny added that a reduction in gas price at the downstream level from US$12.22 per mmbtu to $9.95 per mmbtu will later be followed with a reduction in the gas price at the upstream level. He said that the Ministry of Energy and Mineral Resources is drafting a new ruling to regulate gas price in the upstream, midstream and downstream levels.
He, however, said that the company has yet to predict gas sales volume for this year. Last year, the company channeled 1,599 mmscfd of gas including distribution volume of 803 mmscfd and transmission volume of 795 mmscfd.
The government is struggling to bring down price of gas for industries in a bid to help improve the competitiveness of the domestic industries. Speaking at a gas forum on Wednesday, Minister of Energy and Mineral Resources Ignasius Jonan said that the current distribution cost of gas via pipeline was ?unfair,? saying that he would introduce a new ruling to regulate the gas pipeline toll fee in a bid to help bring down gas price.
Editing by Reiner Simanjuntak