ASEAN KEY DESTINATIONS
PGN to buy Sumatra gas blocks
State-owned Perusahaan Gas Negara has set aside US$250 million to acquire several gas blocks in Sumatra this year, a top executive of the distributor said on Wednesday.
PGN president director Hendi Priyo Santoso said developing the upstream gas business is a new strategy for the company as it tries to secure its fuel supply.
"If we want to have our own gas reserves, the goal is to make our gas supplies safe," Hendi said on Wednesday during a hearing with House Commission VII, which oversees energy affairs.
PGN serves as a gas distributor to power plants, households and industries.
"The gas market is still huge. We are able to expand our range," he said, adding that PGN must ensure gas supplies continue to meet growing demand.
The nation's shortage of gas to fuel power plants and industry is driving PGN to secure additional gas supplies, he said.
Hendi noted that Indonesia's gas supply was not sufficient to meet the existing domestic demand. Total gas demand in Indonesia has reached 4,861 million standard cubic feet per day, compared with PGN's gas supplies of 1,200 mmscfd.
PGN operates 5,800 kilometers of transmission and distribution pipeline networks across the nation. That includes pipelines connecting the Conoco Phillips Grissik field in South Sumatra to Duri, Riau Islands; Grissik to Singapore; and the South Sumatra-West Java pipelines.
PGN transports gas through its transmission networks from upstream suppliers to customers. It channeled 1,674 mmscfd of gas in the first nine months of last year, Hendi said.
Hendi said PGN planned to spend another $250 million to finance the construction of gas pipelines and distribution networks this year but would not disclose the source of the funds.
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