Observers Call Natural Gas Commercialization Constrained By Cross-Sectoral Prices And Coordination

Natural gas (intermediate illustration)

JAKARTA - Efforts to commercialize natural gas to optimize natural gas absorption for the domestic market continue to be carried out. However, there are still obstacles in these efforts, namely prices and the lack of cross-sectoral coordination. In fact, currently, 68 percent of natural gas production is used to meet domestic needs.

Executive Director of the Refominer Institute, Komaidi Notonegoro, said that until now, three related ministries, namely the Ministry of Energy and Mineral Resources (ESDM), the Ministry of Industry, and the Ministry of Finance, still have different views regarding natural gas prices.

"This is certainly homework, because as long as there is no understanding, it will affect natural gas commercialization in Indonesia, even though natural gas needs are expected to continue to grow in the next 10 years," said Komaidi, quoted on Friday, June 21.

Komaidi said the Specific Natural Gas Price (HGBT) was considered one of the keys so that natural gas commercialization could be more optimal. This is because HGBT can determine the economic value of a project. For this reason, understanding is needed between the relevant Ministries, gas producers, and natural gas users.

According to him, the government's goal of providing cheap gas prices for the industry has a good purpose. However, the government also needs to pay attention to the sustainability of other industries.

"In fact, the economic value of the natural gas project is also important, because this is the determinant of natural gas supply for industry," said Komaidi.

Komaidi also gave an example, one of the countries that has succeeded in maintaining the economic value of natural gas is Thailand. According to him, the Thai government is able to provide policies that can provide economic value to all parties, both producers and gas consumers.

"The Thai government guarantees a decent margin for all elements, starting from incentives for natural gas producers, to buyers, there is supply guarantee," he said.

Meanwhile, the Coordinator for the Preparation of the Oil and Gas Program for the Ministry of Energy and Mineral Resources, Rizal Fajar Muttaqin, said that the continuation of the HGBT policy in the industrial sector would be decided by President Joko Widodo.

Rizal said the Ministry of Energy and Mineral Resources was still conducting an evaluation until next August to be reported to the Minister of Energy and Mineral Resources and continued to President Jokowi. He said the evaluations carried out included looking at the state revenue side of the HGBT policy.

"In terms of state revenue, the Minister of Finance said that around Rp. 67 trillion has been used for this price adjustment," he concluded.