Government Affirms Not to Increase Industrial Gas Prices

Illustration. (Photo: Doc. Antara)

JAKARTA - The government through the Ministry of Energy and Mineral Resources (ESDM) emphasized that the government has no plans to increase non-HGBT prices in October 2023.

The Director General of Oil and Gas (Dirjen Migas) of the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that his party would negotiate with upstream stakeholders, namely gas producers and buyers so that gas prices would not increase.

This follows a proposal from PT Medco Energi Internasional Tbk to increase the selling price of upstream gas.

"The point is that gas prices do not increase, we will sit down with them to discuss their interests," said Tutuka when met at the Ministry of Energy and Mineral Resources Building, Monday 2 October.

The reason why Medco asked to increase upstream gas prices is because the fields it manages are those whose production has experienced a decline, so operators need other efforts to increase their productivity. By adjusting gas prices upstream, Medco can maintain gas production in the Corridor Block Grissik Field.

"Yes, usually fields whose production has decreased require additional efforts in that production," added Tutuka.

Tutuka continued, the Ministry of Energy and Mineral Resources will also evaluate the costs incurred by Medco in managing the Corridor Block so that additional incentives can be provided to operators.

"We are evaluating Medco's Grissik Field. The first thing we consider is that the costs must be reasonable, there are benchmarks. The IRR is a result of the costs, so we have to fix the costs first," concluded Tutuka.