PGN on acquisition drive

In search of securing more gas supply, state owned gas distributor PT PGN is exploring the opportunities to acquire a number of oil and gas blocks, both at home and overseas.

President Director Hendi Prio Santoso said on Tuesday the company is now carrying out a due diligence on the acquisition plan.

?There are three or four opportunities. Two of them are located in the country and two other overseas,? Hendi Prio said as reported by The Jakarta Post. He stopped short of providing more details, citing confidential agreements.

By acquiring the blocks and making it a producer, PGN expects to secure more gas supply for its extensive gas pipeline network as against the current situation where it distributes gas produced by gas producers.

At a time when gas demand is on the raise, that would boost the company?s performance as it not only can deliver gas in bigger volume but it can also secure greater margin.

PGN estimates that national gas demand will reach 2,873 mmscfd this year, and 2,958 mmscfd and 2,995 mmscfd in the following two years.

PGN currently has transmission pipeline networks linking major natural gas producing areas with the major industrial zones and residential areas that rely on natural gas as a key source of energy. Its pipeline network has 5,900 kilometers in length and it currently distributes gas volumes of more than 800 mmscfd, and transmitted volumes up to 840 mmscfd.

In the first quarter of the year, PGN raked in US$582.15 million in revenue, increased by 8 percent from $534.63 million of same period last year. Net profit stood at $275.93 million, up 13 percent from $242.25 million in the same period last year.(*)