Pipeline network vital to gas industry growth

Pipeline network vital to gas industry growth

SINGAPORE (Dow Jones): Transmission pipelines to link
Indonesia's scattered natural gas reserves to potential markets
are key to the development of the country's vast natural gas
resources, a senior official with PT Perusahaan Gas Negara said.

But, standing in the way are two major "problem areas" -
"inadequate standards and insufficient legislation." There is
also "no incentive to develop gas supplies in all areas of the
economy," A. Qoyum Tjandranegara, president-director of the
state-owned company, said.

Indonesia needs "a satisfactory and proper gas regulatory
network" to encourage increased investment in the sector and
unite "all public and private sector forces in one big effort to
develop the gas industry," he noted.

Already, Indonesia's energy policy "gives priority to energy
efficiency together with a reduction of energy consumption and
cut in environmental pollution," said Tjandranegara.

In line with the policy, the government is promoting the use
of natural gas in a number of sectors such as power generation,
fertilizers, steel and iron, he added.

But the policy objectives can only become reality if the
country puts in place an adequate natural gas transmission and
distribution network, at the center of which is the "proposed
Indonesian Gas Transmission System (IGT)," Tjandranegara noted.

The IGT will link East Kalimantan, Java, Sumatra, Batam,
Singapore, Johor and Natuna reserves with the market.

"Indonesia has many sources of natural gas which (are) more
than sufficient to meet the domestic needs," the PGN president
said.