Purnomo defends gas producers

Minister of Energy and Mineral Resources Purnomo Yusgiantoro has strongly defended the country’s gas producers which have been widely criticized for their lack of commitment to selling their gas to local buyers, Bisnis Indonesia reported on Saturday.

Speaking to reporters on Friday, Purnomo said that none of the existing gas producers intended to breach the law, which obliged them to sell at least 25 percent of their gas production to domestic market.

The minister acknowledged that certain gas producers could not meet the obligation. But their inability not to fulfill the obligation was due to the depletion of their gas reserves and the lack of infrastructure to distribute their gas in the domestic market.

Two fertilizer producers in Aceh, PT Pupuk Iskandar Muda and PT ASEAN Aceh Fertilizer had been forced to close their operations due to the cut of gas supply from local gas producer ExxonMobil.

Earlier reports said that ExxonMobil had cut off its supply to both fertilizers due to the depletion of its gas reserves. But the company continued to fulfill its export commitment.

Purnomo said that Exxon was still unable to supply Pupuk Iskandar Muda because the new contract had not been signed. For the time being, the supply to ASEAN Aceh Fertilizer plant has also been suspended because its production is mainly for export market, he said. (*)