SKK Migas supports drive to allocate more LNG for power plants
Monday, October 7 2013 - 01:35 AM WIB
Acting Chairman of SKK Migas J. Widjonarko said that the use of more LNG to fuel power plants will reduce the costly government subsidy for petroleum fuel used by state-owned electricity firm PLN.
?So far, there have been 22 cargoes of LNG utilized by the electricity sector. The supply comes from the Mahakam block and received by the regasification facility operated by PT Nusantara Regas. In 2013, SKK Migas received an instruction to supply two cargoes of LNG from the Tangguh LNG refinery in Papua,? said Widjonarko.
He added that the LNG supply for the electricity sector via the Nusantara Regas floating storage and regasification unit (FSRU) has become a joint commitment of SKK Migas and the Ministry of Energy and Mineral Resources.
?The commitment of SKK Migas is to prioritize in fulfilling domestic gas need particularly to support the government?s program in reducing the use of subsidized petroleum-based fuel. In the future there will be more LNG ready for use for fulfilling domestic demand. The challenge now is to complete the construction of the LNG regasification facilities both on shore and off shore on schedule,? he said.
Widjonarko explained that completing the construction of the LNG regasification terminals on time will further increase the credibility of the Indonesian LNG buyers in the eyes of LNG producers. He pointed out that the aforementioned supply of two cargoes of LNG from the Tangguh LNG refineries were based on the instruction letter of the Minister of Energy and Mineral Resources to provide 5 cargoes of LNG. But of the 5 cargoes provided, in turned out that the domestic buyer could only absorb 2 cargoes.
The two LNG cargoes will be dedicated for the Muara Tawar and Muara Karang power plants owned by PLN after undergoing regasification process at the FSRU owned by Nusantara Regas. The one cargo for the Muara Tawar plant in Bekasi, West Java, will be swapped by state-controlled gas distribution firm PGN with gas from the South Sumatra West Java (SSWJ) pipeline initially dedicated for industries in West Java.
PGN consumers which have been receiving gas from the SSWJ pipeline will be compensated with the gas from Nusantara Regas FSRU facility.
The presence of the West Java FSRU operated by Nusantara Regas is expected to help ensure the supply of gas for both electricity and industrial sectors in the province going forward.
Editing by Reiner Simanjuntak