PLN to face huge gas supply deficit 2012
Thursday, May 3 2007 - 01:24 AM WIB
PLN Director Ali Herman Ibrahim said that supply shortage pinch had been felt even now, forcing PLN to burn more expensive fuel oil at several of its power plants.
?Currently PLN is 500MMCFD short in West Java alone as several contracts such as from BP West Java would end by 2012. So far PLN can only secure 85 MMCFD of new contracts from Jambi Merang that would hold until after 2012, ? he said, adding that the shortage would reach 700MMCFD after 2012 if the company was not able to secure new supplies.
Ali said that PLN is currently holding negotiation to buy gas from ConocoPhillips? Suban-3 gas field in Corridor PSC, South Sumatra. ?PLN is hoping to get 300-400MMCFD from Suban he said. Suban-3 gas, he said, would be used to fuel PLN?s power plants in West Java and Banten that would undergo re-powering program. PLN will be competing with state gas distribution company PGN to buy Suban-3 gas, as PGN has also claimed to conduct negotiation with ConocoPhillips.
To get adequate supply of gas, PLN is also planning to build LNG receiving terminal in Bojanegara, Banten province, which is slated to come onstream around 2010. ?We?re looking to get 3-4MTPA of gas supply from Tangguh LNG project in Papua, but the government told us to hold B-to-B talks with BP over LNG supply and price; that?s very difficult, as PLN would not be able to buy LNG at current market price, unless PLN is allowed to pass through fuel costs to customers. Currently PLN?s hands are tied as far as raising electricity selling price is concerned, ? he said. Ali said government intervention to lower LNG price from Tangguh would be essential to get the deal done. ?PLN just want to buy Tangguh LNG at the price that meet PLN?s economic criteria,? he said.
Alternatively, he said, PLN has made some approaches through third parties to secure LNG supply from overseas producers such as Qatar and Australia. (godang)