Pertamina urged to act on major LPG shortage

Sari P. Setiogi, The Jakarta Post, Jakarta

Companies are scrambling for liquefied petroleum gas (LPG) after production problems at Petamina's Balongan refinery in West Java have caused supplies to drop dramatically.

They called on the state-owned oil and gas company to fill the shortage, which began in mid-January and was threatening their businesses.

"We used to get three tons of LPG a day, now we can only get two tons," an executive at GS Battery said.

The executive, whose company produces automotive batteries in Kerawang, West Java and Sunter, North Jakarta, said the shortage of LPG could seriously hurt production.

Indonesian Automotive Parts Industry Association chairman Hadi Surjadipradja confirmed on Monday many of its members were facing an LPG crisis.

"If we are not provided with new LPG supply this week, many companies will stop their operations," he told The Jakarta Post.

LPG played a pivotal role in producing auto parts, particularly in the treatment process that protects components from high temperatures.

LPG is also popular among households in urban areas as a fuel for cooking and heating water.

LPG vendors in Jakarta's districts of Tebet, Rawamangun and Cempaka Putih interviewed by The Post on Saturday said they could not meet orders from households because they were running out stocks.

Pertamina's spokesman M. Harun confirmed on Sunday production at the Balongan refinery had been down since the middle of January following trouble at its residual catalytic cracking (RCC) unit. Repairs were expected to take two weeks.

"We hope the refinery can operate as normal by Feb. 4," he said.

Normally, Balongan, which supplies Jakarta, West Java, Banten, produces 1,200 metric tons of LPG a day. Due to the problems, production has declined about 30 percent.

To balance the supply shortage, Harun said Pertamina was taking LPG from other refineries, such Plaju and Tanjung Sampan in Sumatra and importing it from Singapore.

Since it took time for Pertamina to get deliveries from new sources, some buyers would not get their LPG supplies on time, he said.

The Balongan refinery, which has the processing capacity of 125,000 barrels per day of crude oil, has been shut down several times since it started operation in 1995, because, according to experts, it was fitted with substandard equipment.