Gas shortage to exacerbate power woes on java
Fitri Wulandari, The Jakarta Post, Jakarta
The power crisis on Java, Madura and Bali could last longer as a gas shortage would weigh down state electricity company PLN's capability of boosting its power reserves.
Of course, there are many other problems undermining PLN's capability of meeting power demands, such as an inefficiency in managing the peak load, maintenance system and transmission and distribution lines.
But maintaining enough supply of gas for its gas-fired power plants is pivotal to ending its reliance on oil fuel and to shift to a more environmentally friendly and cheaper fuel.
PLN president Eddie Widiono said the nationwide gas supply for PLN was between 450 and 500 million cubic feet per day (MMCFD), filling only half of its total demand of 800 MMCFD.
As a consequence, some of PLN's gas-fired power plants were forced to use oil fuel, which is not only costly but also shortens the lifespan of the power plants. The use of oil fuel has also forced PLN to overhaul its power plants sooner.
"In addition, power plants cannot operate around-the-clock and only at peak load times," Eddie said recently.
Out of the national installed capacity of 21,144 MW, 4,417 MW or 24 percent comes from gas-fired power plants, according to data from PLN.
Eddie did not provide further details on how many gas-fired power plants run improperly due to a lack of gas. However, the Gresik power plant (600 MW) in East Java and the Muara Tawar power plant (858 MW) in West Java have been running on oil fuel instead of gas.
The Gresik power plant was one of the four power plants that suffered technical problems and was included in the rotating blackouts through some parts of Java and Bali over the past few weeks.
Following the blackouts, PLN said that its reserves were thinning. Of its installed capacity of 18,675 MW on Java and Bali, PLN is only able to supply 13,695 MW. At peak times, power usage reaches 13,250 MW. Meanwhile, the demand for electricity has grown by 8 percent.
To avert disruptions to service, PLN needs to have a 30 percent reserve capacity, but Eddie said it had only a 5 percent to 10 percent reserve capacity.
"The gas fields (of our gas suppliers) are being depleted," Eddie said, when asked why PLN could not fill the demand for gas.
Anglo-American energy giant BP Plc said the gas reserve in its Kangean Bloc off the shore of Madura island, which has been the sole supplier of gas for the Gresik power plant, was running out.
The reserve is predicted to drop to 100 MMFCD in 2005 and 20 MMFCD in 2010, from its current production level of 180 MMFCD, due to diminishing gas reserves in the old fields.
Like many other parts of the country, East Java is believed to be rich with natural gas resources, with more than enough to fill the demands of industries and PLN in the area.
However, under a contract issued by the Soeharto administration, BP has the monopoly right to supply gas to the region. It will supply up to 600 MMFCD to East Java until 2010. No other companies are allowed in the market unless demand exceeds 600 MMFCD. BP can only supply some 180 MMFCD.
The government and BP recently agreed to review the contract, giving other gas producers greater freedom in supplying gas to the region.
BP had asked the government to extend its contract on Kangena. With the extension, BP is seeking to explore new gas reserves in Terang Sirasun and Batur, which lie within the block, to increase gas production by 60 more MMFCD in 2006 and 300 MMFCD in 2006.
BP has also proposed to build the first gasification terminal to avert a gas shortage in West Java. Gas for the terminal will be taken to the Tangguh gas field in the Bird Head area of Papua. The ambitious project, valued at US$380 million, is expected to be completed in 2007 and hoped to supply 500 MMFCD.
However, the government has yet to approve the contract's extension and the LNG supply to West Java.