59th Anniversary, PGN Affirms Strategic Plan To Encourage The Role Of Natural Gas As Transition Energy

Photo: Doc. Antara

JAKARTA - PT PGN Tbk was exactly 59 years old on May 13, 2024. At this age PGN as Pertamina's Gas Subholding emphasized its commitment to its role in expanding the use of natural gas as transitional energy. Strategic plans have been prepared so that PGN can strengthen this role in the midst of dynamic market conditions.

"At this age, PGN is expected to be stronger and continues to be determined to build pipeline and beyond pipeline infrastructure, including LNG Trading. In the future, PGN is Pertamina's hope in the energy transition. If you look at the trilema of energy, gas has very high hopes during the transition period," said Pertamina's Logistics & Infrastructure Director Alfian Nasution in his remarks at the 59th PGN Anniversary Peak Celebration, Monday, May 13.

In the future, opportunities are still wide open. Moreover, supported by RJPP Pertamina where on the upstream side, gas production will increase significantly, PGN is expected to be able to take advantage of it.

PGN is also expected to be more synergized with other subholdings, one of which is with Subholding C&T to help reduce LPG imports. Several pilot projects have been running in that direction, hopefully the gas network will increase and subsidized LPG (3 kg) can be substitutional to natural gas networks. Thus, future strategies for gas transition can be more real," said Alfian.

On the same occasion, PGN President Commissioner Amien Sunaryadi spurred PGN Group to improve its presence in the eyes of the community by expanding natural gas infrastructure connections in various regions. "Let's improve the gas network connection going forward. Not all places are easily traversed by pipeline networks, therefore gas distribution should be with Beyond pipelines or CNG," he said.

According to Amien, it is important for PGN to increase the use of CNG for quality jargas, considering that jargas is the top priority. The construction of jargas must be massive to occupy the CNG market leader and the existence of PGN can really be seen in the community. "Let's work together, let's work fast and achieve the KPI that has been launched," said Amien.

PGN President Director Arief Setiawan Handoko expressed his optimism that PGN in developing natural gas in Indonesia was also based on a note from the Ministry of Energy and Mineral Resources that the use of fossil oil and gas energy still plays an important role in securing the national energy supply. In particular, natural gas, this energy is used as a transitional energy towards Net Zero Emission in 2060. PGN will continue to prioritize the integration of natural gas infrastructure development and increase the use of high integrity natural gas.

In order to take the momentum of economic improvement, acceleration of energy transition, and the need to develop future business or derivative products that support carbon emission reduction, PGN takes strategic steps as outlined in the three pillars of business development, namely Grow, Adapt, and Step-out (GAS). Seven National Gasification Programs will continue in the Grow pillar. Meanwhile, new programs such as LNG Trading and business development biomethane, CO2 Transport, and downstream gas will be included in the Adapt pillar and pillar of Step-out," explained Arief.

The industrial segment is expected to still be the main support for natural gas demand, along with the growing movement of industry and the economy. The volume of the household segment will also increase as the target of adding 117 thousand household connections in 2024.

In addition, PGN carries out business diversification through the business development of Subsidiaries by building an Arun LNG Hub, developing a clean and renewable energy business and upstream business optimization.

PGN will also develop several projects for LNG and mini LNG regasification to meet gas needs that have not been reached by the natural gas pipeline network. This is a long-term strategy to strengthen future natural gas supply. Not only that, PGN will carry out new business development, which mainly supports NZE such as biomethane, petrochemical, hydrogen, and CO2 transport.

Currently, PGN manages natural gas pipeline networks along the past 12,692 KM, up 10% from 2022 or an increase of 1,167 KM and manages 4 LNG terminals. From this infrastructure, PGN has distributed natural gas to 825,856 household customers, 3,103 industries and commercials, as well as 1,976 small customers.

We are optimistic that performance will remain good in the coming years, one of which is due to maintained domestic economic conditions. We stick to key strategies. At the same time, we implement a risk management system, internal control and financial management that is disciplined and careful," said Arief.

In carrying out strategic steps, PGN realizes that it will face the dynamics that have an impact on the company. So, PGN will continue to ensure the management of the company's natural gas business based on the principles of sustainability and good governance.

PGN is committed and consistent in realizing energy independence in the country during the energy transition period through strengthening gas supply and expanding natural gas infrastructure. PGN's readiness is also strengthened for the implementation of ESG and green energy through optimal technology selection in energy diversification and energy renewable use transition, "concluded Arief.