Jokowi Asks ESDM Minister Arifin Tasrif To Evaluate Natural Gas Costs To Be Competitive

Minister of Energy and Mineral Resources Arifin Tasrif. (Photo: Maria Trisnawati/VOI)

JAKARTA - President Joko Widodo (Jokowi) ordered the Minister of Energy and Mineral Resources Arifin Tasrif to evaluate natural gas production costs so that selling prices to industry become competitive, especially compared to countries in the ASEAN region.

"We are asked to re-evaluate. Later there will be a team between ministries to evaluate the costs incurred to be able to produce the gas so that we can ensure that the gas can really, according to the costs incurred," said ESDM Minister Arifin Tasrif as quoted by Antara, Tuesday, August 1.

Arifin said that the evaluation of gas production costs is needed so that Indonesia's economic structure in the oil and gas sector is more competitive than other countries.

Moreover, he continued, Indonesia's natural oil production was also exported to foreign countries.

"The operation is efficient so that we can get competitive gas to be able to support the development of the domestic industry," he said.

Furthermore, said Arifin, in this Monday meeting, the President and the ranks of ministers discussed a large strategy (grand strategy) for the exploration and exploitation of natural gas. In principle, said Arifin, Indonesia still prioritizes the use of natural gas for domestic needs.

However, the government will also not ban natural gas exports because excess natural gas production results can be used to increase state revenue.

"So all of our gas production is 67 percent used domestically. The rest is absorbed, which is what we sell commercially, among others, exported in the form of LNG and piped gas," he said.

Indonesia is one of the world's natural gas producers, with great natural gas potential with reserves proven in 2021 to be around 41.62 trillion cubic feet (trillion cubic feet/TCF) and potential reserves of 18.99 TCF.

Based on the Indonesian Gas Balance 2022-2030, domestic natural gas production is able to meet domestic needs.

In the next 10 years, it is estimated that there will be a gas surplus of up to 1,715 million cubic feet per day (MMscfd).