INDONESIAN OFFICIALS are reported to be awaiting the publication of reliable figures on the country’s natural gas resources before deciding new policies governing the construction of domestic pipelines and future exports of LNG. “I hope the preparation of the gas supply and needs projections will be completed this month,” Luluk Sumiarso, director general of the ministry of energy and mineral resources, said in February. He went on to say that the gas projections would provide information on proved gas reserves and potential demand in nine gas-producing provinces: Nanggroe Aceh Darussalam, North Sumatra, South Sumatra, Jambi, West Java, Central Java, East Java, East Kalimantan, and Papua. Mr Luluk said the data will be used as the basis for deciding future export policy and whether Indonesia will construct a planned 1,115-km pipeline linking East Kalimantan and Central Java.
Because of increased domestic gas demand, the government plans to cut LNG exports by 19% to Japan, South Korea, and Taiwan this year, shipping 19.4m tons of LNG instead of the contracted 24m tons. State-run Pertamina also is negotiating the postponement or replacement by other producers of 36 cargoes from Badak NGL’s LNG plant in Bontang, East Kalimantan, and 22 from Aceh-based LNG producer Arun NGL.
Energy and Mineral Resources Minister Purnomo Yusgiantoro said the government might choose to transport via LNG carriers, instead of pipelines, to overcome gas shortages in Java. The uncertainty over gas supplies has prompted Rekayasa Industry (Rekin) and state-owned Pertamina to postpone construction of a 480-km gas pipeline between Cirebon in West Java and Gresik in East Java. Rekin, a state-owned engineering company, holds the contract to build the Cirebon-Semarang section in Central Java, while Pertamina was awarded the contract for the Semarang-Gresik segment.
Rekin’s presdident Triharyo Indrawan Susilo said his company needs guarantees concerning the gas supplies from East Kalimantan. However it is unclear how Mr Luluk’s remarks will affect the plans of Bakrie & Brothers (B&B), who won the tender from the downstream oil and gas industry regulator BPH Migas last July to build and operate the East Kalimantan-Central Java pipeline. B&B said in December that it plans to proceed with the project despite doubt voiced by officials about its feasibility.