PGN Will Distribute 36,500 MMBTU Bio-CNG Retail Customers In Indonesia

The PGN Board of Directors signed a Bio-CNG development cooperation agreement. (Photo: PGAS)

JAKARTA PT PGN Tbk seeks to develop the use of biomethane from palm oil or Palm Oil Mill Effluent (POME) waste in Indonesia. In its realization, PGN involves a subsidiary, namely PT Gagas Energi Indonesia (Gagas) to follow up on cooperation in the use of compressed biomethane (Bio-CNG) with PT KIS Biofuels Indonesia (KIS).

Bio-CNG utilization cooperation for retail customers is the first time this has been done in Indonesia. For the first step, KIS will distribute around 36,500 MMBTU in the first year to Gagas. Furthermore, this need will be adjusted and can increase by 100 percent in the fifth year.

PGN's Director of Strategy and Business Development, Rosa Permata Sari, emphasized that this collaboration is a follow-up to the signing of the MoU between PGN and KIS in the G20 event in Bali in 2022.

This cooperation is a form of PGN's commitment to expanding the use of environmentally friendly energy by optimizing the potentials owned by this country and can be an example for the use of sustainable new sources.

"The collaboration in utilizing Bio-CNG between Gagas and KIS for retail customers is a new step we are taking to support the Government to achieve the Net Zero Emission target in 2060," Rosa said in a statement to the media, Friday, January 12.

PGN maps, in the future Bio-CNG can be an option to increase natural gas supply in Sumatra, Kalimantan and its surroundings.

The Bio CNG character, which is similar to the natural gas flowed by PGN, allows the flexibility of the swap/exchange mechanism between the two types of commodities, including the use of PGN's infrastructure.

"Development of the potential Bio-CNG project is a new renewable energy that can help reduce dependence on fossil fuels and be more environmentally friendly," continued Rosa.

For information, Gagas inaugurated a collaboration with KIS at the end of 2023 and was strengthened through a meeting between PGN, KIS and Gagas on Wednesday, January 10.

The meeting was attended by the Director of Strategy and Business Development of PGN, Rosa Permata Sari, Director of KIS, K.R.men'snath, and President Director of Gagas, Muhammad Hardiansyah at the PGN Headquarters in Jakarta.

In the Bio-CNG utilization cooperation scheme, KIS will process palm oil liquid waste so that it produces gas that is characteristic to resemble natural gas. The gas will then be compressed and will be used by Gagas for further distribution to commercial and industrial customers.

K.R. Ornath, Director of KIS revealed that cooperation to capture methane from palm oil liquid waste will further strengthen the biomethane industry in Indonesia and help reduce greenhouse gas emissions.

"This cooperation project will help reduce emission problems and support Indonesia to achieve the Net Zero Emission target," explained Ornath.

According to him, the gas remains in its role as an environmentally friendly energy provider through the Beyond Pipeline mode. However, this time one of the supplies obtained comes from a more sustainable energy source, namely palm oil liquid waste that has been processed by KIS into biomethane which we will transport in the form of BioCNG.

"For the first step, the cooperation process will be carried out in the Pekanbaru area, Riau. Furthermore, if the cooperation goes well, this cooperation will be duplicated in other regions in Indonesia such as Bangka Belitung, Sumatra and Kalimantan," explained the President Director of Gagas Muhammad Hardiansyah.