PGN Signs International LNG Sales And Purchase Cooperation

PT PGN Tbk and PRISM Energy Internasional signed a master agreement or in the context of buying and selling LNG at the 28th World Gas Conference, Daegu, South Korea, Tuesday (24/5/2022). ANTARA/HO-PT PGN Tbk​​​​​

JAKARTA - PT PGN Tbk, as the Gas Subholding PT Pertamina (Persero), is preparing to enter the international LNG market by cooperating with PRISM Energy International, a South Korean subsidiary, SK E&S, which is engaged in LNG trading.

PGN and PRISM signed a master sales and purchase agreement (MSPA) in the context of buying and selling LNG at the 28th World Gas Conference, Daegu, South Korea, said a press release received in Jakarta, reported by Antara, Tuesday, May 24.

The MSPA was signed by PGN's Director of Strategy and Business Development, Heru Setiawan, and Chung Jaehak, CEO of PRISM Energy International.

This MSPA is a follow-up to the signing of the MOU between PGN and SK E&S for cooperation in the development of LNG, hydrogen, and carbon capture storage (CCS), which was also witnessed by the Coordinating Minister for Economic Affairs Airlangga Hartarto on February 22, 2022.

PGN's Director of Strategy and Business Development Heru Setiawan said that the MSPA will open up international LNG trading opportunities for PGN in an effort to provide clean energy with PRISM.

"We challenge ourselves so that we are not only present for domestic natural gas needs where we have reached 89 percent market share, but also to be able to get out of our comfort zone by entering the international market," said Heru.

In addition to international LNG trading, this collaboration is also in line with SK Group's vision and mission in the utilization of natural gas towards a clean energy transition period. In this case, Indonesia has a potential renewable energy source to provide green hydrogen.

Heru hopes that PGN and SK Group can complement each other in the development of new and renewable energy including the development of LNG, hydrogen, and CCS.

Energy policies and the clean energy transition are the main determinants of LNG demand in South Korea. At the end of 2020, South Korea also announced a target of net zero emissions by 2050, while the share of LNG in the power generation mix in 2030 reaches up to 19 percent.

The role of LNG in the power mix will continue to grow, with the estimated demand for LNG from South Korea in 2030 will reach between 65-66 billion cubic meters (bcm) or around 50 Mt.

"We believe that with the synergy of LNG infrastructure, technology, market, as well as reliable LNG suppliers, PGN and SK Group are able to support the growing demand for natural gas for the clean energy transition in South Korea, Southeast Asia and other global markets," said Heru.