Most Expensive In Asean, Gas Prices Asked To Be Quickly Down

The price of industrial gas in Indonesia is currently the most expensive among Southeast Asian member countries. This causes Indonesia's competitiveness with friendly countries to be weak. Even Indonesia's industrial competitiveness began to surpass Vietnam.

Chairman of the Board of Trustees of the Indonesian Ceramics Association (Asaki) Hendrata Atmoko said, the gas price according to the government's wishes of US $ 6 per MMBtu in Government Regulation No. 40/2016 is still somewhat higher than other ASEAN countries, such as Malaysia, Vietnam, and Thailand.

Ideally, the price of gas for the industry is US $ 5 per MMBtu. This gas price reduction can be done by reducing costs downstream of the gas.

"Not upstream, downstream costs must be reduced, transmission costs, pipeline costs, all kinds of costs. These downstream costs are partly private. If the government cuts downstream gas, it can help industry growth. If gas prices can be reduced to US $ 5 per MMBtu like in other Southeast Asian countries, the selling price of the product can compete with imported products.

That way there is a domino effect for increasing production and using more labor. In Hendrata's calculation, if the price of gas is US $ 6 per MMBtu, the production costs could go down to 12%.

Meanwhile, if gas prices are pressed down to US $ 5 per MMBTU. then the production costs can reach 15%. Generally the component of gas costs to total industrial costs can be 30%.

The gas-consuming industries are steel, ceramics and the plastics industry. Managing Director of Perusahaan Listrik Negara (PLN) Company Sofyan Basir promised, if gas prices fall to US $ 6 per MMBtu.

The Executive Director of the Indonesian Iron and Steel Industry Association Hidayat Triseputro stated, the proposal to reduce gas prices is long, so it should be implemented immediately.

Wianda Pusponegoro 

PT Pertamina Vice President Corporate Communication Wianda Pusponegoro said the government should check other business entities about gas margins. Pertagas Niaga has reduced the gas margin of US $ 1 per MMBtu for North Sumatra since January 1, 2016. 

   You can also check other business entities. Related to the price of gas that is lazy to go down, the Ex-Task of the Minister of Energy and Mineral Resources Luhut Binsar Panjaitan said, if gas prices in an area are expensive, it can be imported. For example, to import only Medan so that US $ 7 per MMBtu compared to now the US $ 13 per MMBtu.

Kontan, Page-14, Saturday, Oct 15, 2016.