History of Gas Indonesia: A Natural Gas News
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| Offshore: Natural Gas News |
After Qatar, Malaysia and Australia, Indonesia today is an
exporter of liquefied natural gas (liquefied natural gas / LNG) in the world's
fourth largest. This does not mean - as mentioned above - that domestic demand
can be met by domestic production. As a result, Indonesia needs to import LNG
from abroad so as not to disturb the export commitment. It is estimated that in
2017 additional supplies of gas from new fields Indonesia will be able to
replace imports.
Indonesia, the largest LNG exporter, decreased global LNG
market share, partly due to the reorientation of government policies that
target premises in medio 2000 more supply of gas to the domestic market
in the context of the increasing use of gas as a source of energy (by reducing
dependence on oil). However, this decline also occurred because of a lack of
long-term investment in both the exploration and development of gas fields of
the country.
At the end of 2014 about Natural Gas News, Indonesian Petroleum Association (IPA)
stated that this agency predicts investment (exploration) in Indonesian gas
sector will fall 20% in 2015 (mainly due to lower energy prices). In addition,
at the end of 2014, Chevron Pacific Indonesia (a subsidiary of the giant oil
and gas that is headquartered in the United States Chevron Corp) delaying the
project Indonesia Deepwater Development (IDD) to 12 billion US dollars in the
Strait of Makassar in South Kalimantan due to relieve or licensing issues and
because the company needs more time to revise the calculation after the
discovery of new gas reserves.
A number of long-term export contracts signed in the early
and mid-2000s valued at below market price, meaning Indonesia amounted to a
significant loss of income. Instead of linking the level of gas contracts with
fluctuating market prices, a fixed price agreed was soon becomes no longer
appropriate because the market price (rising). The Indonesian government has
been trying to renegotiate contracts in the long term in order to get more
financial benefits. Nevertheless, from the perspective of business people a
clear intention to renegotiate the contract is not the best option (for causing
uncertainty about the commitment of the Indonesian Government to respect the
signed contract). Objectives main LNG export Indoneisa are Japan, South Korea
and Taiwan.
Projected Future For Gas Sector Indonesia: Natural Gas News
Indonesia's economy is expanding combined with the
Government's intention to reduce dependence on oil as a source of energy supply
in industries, power plants and transportation will cause domestic demand for
gas to increase in the future. The country has abundant gas reserves to supply
Indonesia and also overseas export market for many decades in the future.
However, in order to achieve an efficient gas sector and productive,
large-scale investments both in exploration and infrastructure (distributional)
will be required. In order to attract more foreign investment, the regulatory
system and a clear legal framework and support required.
At the end of 2015 I Gusti Nyoman Wiratmaja, Director
General of Oil and Gas of the Ministry of Energy and Mineral Resources, said
that Indonesia needs investment worth more than 32 billion US dollars (mostly
from the private sector) to refineries natural gas, and infrastructure relating
to the gas in order to meet domestic gas demand in 2025 (mainly for power
plants and fertilizer factories). Indonesia's gas demand is expected to rise
from 6.102 million standard cubic feet per day (million standard cubic feet per
day / MMSCFD) in 2015 to 8.854 MMSCFD in 2025 with demand mostly comes from
Java and Bali. Without giving details of the clear, Wiratmaja adding that there
are incentives for the private sector to invest in the domestic gas industry. (source of article: http://www.indonesia-investments.com/id/bisnis/komoditas/gas-alam/item184)
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