Constrained Cheap Gas Program, Ministry Of Industry Spokesperson: There Is A Problem With The Supply Side

Industrial Gas (Photo: dock. Antara)

JAKARTA - The Ministry of Industry (Kemenperin) said that the supply of cheap gas for the industry was experiencing problems.

Currently, there are seven (7) industrial sectors that are entitled to Certain Natural Gas Prices (HGBT), which they can get gas supply below market prices, namely USD 6 per MMBTU.

Spokesperson for the Ministry of Industry Febri Hendri Antoni Arif denied that the problem was caused by an industry that was unable to absorb HGBT. However, Febri claims there is a problem in terms of supply.

Because, he said, it would not make sense if the industry was unable to absorb natural gas at a price of US$6 per MMBTU.

"For HGBT, we found information that there were maintenance problems so that the supply of HGBT to industrial companies participating in the HGBT program was stalled. So, the problem is not in industries that are not able to absorb HGBT but in terms of supply," said Febri at the Ministry of Industry office, Jakarta, quoted Friday, March 1.

"So, we feel a bit like that when someone says that the industry is unable to absorb HGBT. It doesn't make sense if the industry is unable to absorb gas prices below 6 US dollars per MMBTU," he continued.

Febri assessed that if the supply of natural gas was not problematic, the absorption of this program would be maximized. He said there were obstacles in the upstream gas industry sector related to maintenance.

"For example, there is a lot of supply, I'm sure there will be a lot of absorption. But this, right, said the industry was unable to absorb it, now this is impossible. What might happen is that we get information that the upstream gas industry is doing maintenance. So, the gas supply is lacking, so it's not an industry that can't absorb," he said.

Febri hopes that the HGBT program will continue to run and the recipients will be expanded. According to him, this program is able to boost the value of the industrial confidence index (IKI) if it goes well.

"We know that the HGBT program has been able to increase added value and increase the competitiveness of industrial products that are participants in the program," he added.

Previously reported, the Director General of Metal, Machinery, Transportation Equipment and Electronics Industry of the Ministry of Industry, Taufiek Bawazier, said that the expansion of the HGBT needed to be done. Because, it will provide many benefits for Indonesia.

"Ask to expand because the benefits are large, there is also added value for raw materials. This is part of the government to raise it," he said at the Ministry of Industry's office, Friday, February 23.

According to Taufiek, if the policy continues, it will be able to strengthen the national industry.

"We ask to continue so that the added value of the national industry is stronger, that is the first record and also availability or adequacy. Do not let the price be 6 US dollars but not enough," he said.

The Ministry of Energy and Mineral Resources (ESDM) said that further evaluation is needed regarding the proposed expansion of certain natural gas price programs (HGBT) to be given to all industrial sectors.

Director General of Oil and Gas (Migas) of the Ministry of Energy and Mineral Resources Tutuka Ariadji said, there are several factors that need to be considered, such as natural gas reserves and state revenues.

"Yes, we ask the Ministry of Industry to conduct an evaluation. This is asking the Ministry of Industry to answer. We are trying to support HGBT but precisely in industries that need it," he said.