ASEAN KEY DESTINATIONS
New gas supply mostly to go to power plants
The gas supply for industrial and home use will face shortages in the next few years as most of the additional supply will be used to feed new gas-fired power and fertilizer plants.
According to the latest figures from the Energy and Mineral Resources Ministry, total gas demand will reach 11,049 million standard cubic feet per day in 2019, rising by 1,361 mmscfd or almost 15 percent from the estimated 9,688 mmscfd demand this year.
Of the additional 1,361 mmscfd supply needed, about 1,100 mmscfd will be used for electricity generation while another 200 mmscfd will be for the fertilizer industry.
“The demand from power plants has sharply increased because of the large number of gas-fired power plants that are currently under construction,” said the ministry’s acting director general for oil and gas, IGN Wiratmaja.
He said Indonesia would have to import because the domestic supply would likely be insufficient to meet the demand, adding that his office was still working on the details of the supply figures.
The government is currently aiming to have an additional electricity-generating capacity of 35,000 megawatts (MW) within five years. Of that total, as many as 13,400 MW will be generated by gas-fired power plants.
The estimated additional gas demand for electricity is almost two times the 1,250 mmscfd that is currently needed by state-owned electricity firm PLN to generate power.
The Upstream Oil and Gas Regulatory Special Task Force‘s (SKKMigas) deputy for marketing control, Zikrullah, said that out of the total 13,400 MW power plant capacity in need of a secure gas supply, up to 2,000 MW have already allocated gas. Meanwhile, SKKMigas already has plans for supplying gas for another 4,000 MW. However, the regulatory task force still has no clue how to supply the gas needed for the remaining 7,400 MW.
“The need for imports will likely occur in 2018. However, imports will only be possible if the infrastructure is ready,” Zikrullah said.
Although Indonesia is estimated to have a significant amount of gas resources and still remains a major exporter of liquefied natural gas (LNG), the country’s gas production has started to decline as fields have been exhausted.
PLN and state-owned gas distributor PGN have begun to import liquefied natural gas (LNG) to cope with the supply shortage in the country.
Pertamina has also said that it will import more LNG from Mozambique. Pertamina previously signed two 20-year contracts to import a total of 1.52 million tons of LNG annually starting in 2018 and 2019 from Cheniere Energy Inc. in the United States.
The first contract was signed on Dec. 4, 2013, and the second on July 1, each for 760,000 tons per year. The LNG will be shipped by Pertamina’s tankers to feed five Pertamina LNG terminals. Meanwhile, supply from new fields is uncertain particularly because of a number of stalled and delayed gas projects, such as the massive deepwater project called the Indonesia Deepwater Development (IDD) and Inpex’s Abadi project.
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