PIM fertilizer plant still suffers gas supply shortage

Aceh-based fertilizer producer PT Pupuk Iskandar Muda (PIM) still suffers a shortage of natural gas supply despite the government's recent pledge to provide enough supply to the state owned firm, Media Indonesia reported on Wednesday.

"The gas supply it not enough to run the two existing fertilizer plants. We need at least 110 MMSCFD (million standard cubic feet per day) of natural gas to fully operate, while the supply now stands at 57 MMCFD," PIM's president Hidayat Nyak Man was quoted as saying in Jakarta.

There are three fertilizer plants in the area, two of which belong to PIM, that is PIM I and PIM II. The other one is owned by PT ASEAN Aceh Fertilizer (AAF), a joint venture of several ASEAN countries.

The government said recently that it would shut down the operation of AAF's plant due to the decline in gas supply from ExxonMobil Indonesia's gas field. It promised, however, to provide sufficient supply to PIM's two fertilizer plants.

ExxonMobil Indonesia, the only supplier of natural gas in Aceh, ships most of its gas output to the Arun LNG plant to meet the plant's LNG export commitment to South Korea and Japan.

Hidayat said that the Arun LNG plant should transfer its LNG export commitment to the Bontang LNG plant in East Kalimantan so that ExxonMobil can meet the fertilizer firm's gas demand. (*)