Poor infrastructure hampers wider use of natural gas
Poor infrastructure hampers wider use of natural gas
Fitri Wulandari, The Jakarta Post, Jakarta
The lack of infrastructure to transport and distribute natural
gas is a major obstacle to pushing for its wider use in order to
reduce the country's heavy dependence on oil-based fuels.
Secretary-General of the Ministry of Energy and Mineral
Resources Luluk Sumiarso said the disparity between supply and
demand for natural gas from industries, households and power
plants persisted because sources were located far from the
market.
Most natural gas sources are located in remote locations on
Sumatra and Kalimantan, whereas the end-users for the fuel are
industries and households on heavily populated Java.
"We are working out ways to transport natural gas from remote
locations," Luluk told The Jakarta Post on Tuesday, commenting on
plans to promote the wider use of natural gas to prevent
Indonesia from becoming a net oil importer in the future.
The Oil and Gas Upstream Regulatory Body (BP Migas) said
Indonesia could become a net oil importer in 10 years if no new
oil finds were discovered while oil-based consumption remained
high.
In 2003, the country consumed 54.7 million kiloliters of oil-
based fuels, while crude oil production continued to decline
because of aging oil wells. Crude oil output stood at 1.087
billion barrels in 2003, lower than the quota set by the
Organization of Petroleum Exporting Countries (OPEC).
Indonesia is the only Southeast Asian member country of the
oil cartel.
Currently, the country has proven and possible natural gas
reserves of 170 trillion cubic feet (TCF) and an annual
production of 3 TCF. Indonesia is the largest liquefied natural
gas (LNG) producer in the world, exporting 65 percent of its
annual production.
President of state-owned gas utility company PT Perusahaan Gas
Negara (PGN) WMP Simandjuntak said poor infrastructure for
natural gas distribution was the main reason for the high export
figure compared to domestic consumption.
"Gas producers prefer to sell their gas abroad, because it is
easier and the price is higher," Simandjuntak told the Post.
He said domestic consumption of natural gas could be increased
if the necessary transportation and distribution infrastructure
was provided.
Domestic energy consumption in Indonesia is still dominated by
oil at 55 percent, followed by natural gas at 23 percent, coal at
15 percent, hydropower at 4.1 percent and geothermal energy at
2.9 percent.
With a core business in natural gas transmission and
distribution, PGN has been working on several pipeline projects
to channel natural gas from gas-producing areas to end-users in
Java.
The company is now completing a transmission pipeline from gas
fields operated by state-owned oil and gas firm PT Pertamina in
Prabumulih, South Sumatra, to West Java, which is expected to be
finished by 2006.
Another major project is its pipeline transmission facility
linking East Kalimantan and East Java.
Besides pipelines, another mode of channeling gas is through
terminal facilities.
Luluk said state-owned electricity company PLN and PGN were
studying the possibility to build terminal facilities.
LNG from natural gas sources on islands outside of Java can be
transported by using vessels to the terminal facility. Upon
arrival at this facility, the LNG is then gasified and
distributed to customers through pipelines.