Govt mulls shipping CNG, plans pilot for Bali
Govt mulls shipping CNG, plans pilot for Bali
Leony Aurora, The Jakarta Post, Jakarta
The Ministry of Energy and Mineral Resources will set up a task
force to study the possibility of transporting compressed natural
gas (CNG) by sea, with Bali serving as a pilot project.
Bali is seen as the best location for the pilot project
because the power plants and industries there can absorb a CNG
supply of between 150 million standard cubic feet per day
(mmscfd) and 250 mmscfd, which is necessary to make the project
commercially feasible, according to a study by a consortium that
includes South Korea's Samsung and Japan's Sumitomo Corp.
Sea transportation also suits Bali as the island cannot be
reached by gas pipelines due to its topographical conditions.
A feasible distance for the project is between 500 nautical
miles and 1,000 nautical miles, which means the CNG can come from
gas-rich East Kalimantan or the Matindok field in Sulawesi.
"The ministry's Directorate General of Oil and Gas will lead
the task force," said energy minister Purnomo Yusgiantoro on
Thursday during a meeting with the consortium, whose members also
include state power firm PT PLN and state gas distributor PT PGN.
The task force will comprise PLN, PGN, the Oil and Gas
Upstream Regulatory Agency (BP Migas) and the Oil and Gas
Downstream Regulatory Agency (BPH Migas).
The study done by the consortium shows the transportation
costs for 150 mmscfd of CNG would be US$2.45 per million British
thermal unit (mmbtu). Assuming the unit price of $2 per mmbtu,
the gas could be sold at $4.45 per mmbtu -- excluding the cost to
build a CNG plant and storage infrastructure.
In comparison, diesel fuel costs $9.14 per mmbtu-equivalent,
assuming global crude oil prices of $46 per barrel.
Consortium head Anton Tjahjono said the project would take
three years to materialize due to the lack of availability of
shipyards to build six CNG vessels with a capacity of 36,000 tons
each.
"We will get export credit facilities from Korea amounting to
$750 million to construct the vessels," he said.
Members of the consortium will also contribute another $200
million in total of their own funds for the project.