Jakarta Post: PLN secures gas supplies from overseas for power plants

State-owned electricity firm PT PLN has signed initial agreements with a number of overseas gas producers that will supply the company in the future.

According to PLN oil and gas division head Suryadi Mardjoeki, the electricity firm has established a so-called master sales agreement with the suppliers, including Shell and others from Qatar and Japan.

“Now, I’m waiting for a deal with supplier[s] from the US — a kind of deal that allows me to ask for a direct delivery [of gas] when I need it,” Suryadi said.

PLN’s demand for gas continues to grow, to feed its power plants, in line with the government’s appeal to boost domestic utilization of the commodity to reduce the country’s dependency on oil.

Indonesia is estimated to have a quite significant amount of natural gas resources — around 104 trillion standard cubic feet (tscf) in proven and 48 tscf in potential gas reserves. That figure makes the country the 13th-largest owner of proven natural gas reserves in the world and the second-biggest in Asia Pacific after China, according to the International Energy Agency. 

Despite the potential, most of the gas is sold overseas due to poor infrastructure that hinders distribution to domestic players. MORE