Purbaya Asks for Gas Price from Italian Giant to be Set at This Level
Jakarta, CNBC Indonesia - Minister of Finance Purbaya Yudhi Sadewa has requested that the price of Liquefied Natural Gas (LNG) produced from the Geng North field, North Ganal Working Area, by the Italian oil and gas giant, be competitive for domestic industries.
Purbaya, who is also the Head of the Debottlenecking Task Force, assessed that the gas price reaching the industrial level still has the potential to increase due to margins from distributors. Therefore, he asked SKK Migas to ensure that the LNG price from the Geng North field can be below US$10 per MMBtu.
He then highlighted that the LNG price in West Java, which is around US$14 per MMBtu, is quite expensive. Therefore, he proposed that the gas price at the industrial level could be more competitive.
“It’s too expensive if it can be 8, let’s say, can it be 8 or 9?” said Purbaya in the Coordination Meeting for the National Strategic Project Onshore LNG Abadi Masela at the Ministry of Finance, Tuesday (24/2/2026).
In response, the Head of SKK Migas, Djoko Siswanto, explained that LNG has different characteristics and cost structures because it goes through processes such as regasification. So, the price is indeed more expensive compared to pipeline gas.
“Because it uses LNG, there are also regasification costs, then the pipeline, and the ship,” Djoko replied.
However, Purbaya still asked that the gas price received by industries from PGN be around US$9 per MMBtu. Thus, he hopes that PT Perusahaan Gas Negara (PGN) does not take too much profit.
“If it goes through PGN to the industry, PGN can take a lot of profit. Can it be controlled so that, let’s say, at 9 dollars, a certain percentage of the raw price goes to the industry?” said Purbaya.
In addition to the gas price from the Geng North field, Purbaya also asked that the gas price produced by Inpex Masela Ltd in the Masela Block project also be more competitive.
Purbaya assessed that the pipeline gas price for the Masela Block in the plan of development (PoD) of around US$6.8 per MMBtu is quite good. However, industries have the potential to get a higher gas price than that amount.
Therefore, he asked SKK Migas to ensure that PGN does not mark up too much in an effort to meet gas supplies to industries.
“But if it is given to PGN, it might be marked up again, so that when it reaches the market, it is also US$12-13 per MMBtu. Can we find a good scheme in the future so that domestic industries can enjoy it at a more competitive price? That’s what SKK needs to think about,” said Purbaya.
(ven)