The government stated that the supply of Liquefied Natural Gas / LNG in 2017-2018 will still be in excess or above national needs. The government noted that there was respectively an excess of LNG supplies of around 60 cargoes in 2017 and 2018.
Director-General of Oil and Gas at the Ministry of Energy and Mineral Resources (ESDM) I Gusti Nyoman Wiratmaja said that in 2017, there was an excess supply of LNG totaling 63 cargoes. Meanwhile, the excess supply of LNG in 2018 is predicted to increase, namely above 60 cargoes.
Excess supply occurred at the Badak LNG Plant in Bontang, East Kalimantan, and the Tangguh Refinery in Bintuni Bay, Papua. The government is negotiating the sale of 13 LNG cargoes for next year's allocation. Meanwhile, for the rest, the government is still looking for buyers.
"We want this to be sold to existing buyers. According to Wiratmaja, this excess LNG supply is not because the gas production sent to the refineries is too high. Gas production remains as planned. However, the government has not been able to find buyers willing to take the LNG. On the other hand, the government does not want to cut gas production upstream. He added that the excess supply has calculated the growth in demand for LNG for lyric power plants in the next two years.
Although, he admitted that the infrastructure for LNG recipients is still in the auction stage. Thus, this excess supply of LNG occurs purely because it cannot be absorbed domestically. With this excess supply, his party will not grant LNG import permits in 2017 and 2018. Import permits will likely begin to be granted by the government in 2019.
Previously, Vice President of LNG of PT Pertamina (Persero) Didik Sasongko said the company had prepared steps to anticipate a gas deficit of 1.5 billion cubic feet per day / BCFD in 2020. Pertamina has committed to supply LNG from other countries that can be brought to Indonesia. starting 2019.
"Like it or not, we will meet approximately 50% of the volume gap in production and gas demand," he said.
Cheniere Energy Inc
Pertamina has pressed a gas sale and purchase agreement (PJBG) with a subsidiary of Cheniere Energy Inc, namely Corpus Christi Liquefaction Liability Company with a volume of 0.76 million tons per year. The supply started in 2019 for 20 years. In addition, Pertamina has also contracted with Cheniere Energy with the same volume but started in 2018.
This supply will also last for 20 years. Not only that, Pertamina already has a commitment to supply 1.5 million tons per year from the world portfolio starting 2020. Pertamina has not received an LNG import permit. The government must have its own considerations. If it is simultaneously importing, it will close domestic gas production, ”said Didik.
But he is sure, in 2019, the gas supply he has prepared will be purchased by domestic buyers.
Investor Daily, Page-9, Saturday, Oct 22, 2016
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