Cutting Transaction Deficit, Govt Steps Up Domestic Gas Utilization

MINISTRY OF ENERGY AND MINERAL RESOURCES

PRESS RELEASE

NUMBER: 638.Pers/04/SJI/2019

Dated: 1st November 2019

Cutting Transaction Deficit, Govt Steps Up Domestic Gas Utilization

To follow up President Joko Widodo's instruction to overcome trade deficit and current account deficit of oil and gas, Minister of Energy and Mineral (EMR) Arifin Tasrif continues to find breakthrough in an effort to reduce natural gas imports, for example by stepping up the domestic utilization of gas.

"We will try to use our natural gas for domestic consumption such as through the gas networks in order to reduce imports. We are discussing this in detail," Arifin explained. Minister Arifin said this in front of the media in Jakarta, Friday (1/11).

Increased utilization of gas in the country, continued Arifin, will run optimally if it is followed by an appropriate policy of price setting. He admits that gas price is set at commercial level, following the prices on the global market. However, natural gas price in Indonesia is very competitive because it follows the regulation set out by the Government via Regulation of Minister of EMR No. 58 of 2017 as revised through Regulation of Minister of EMR No. 14 of 2019.

"Gas (price) is commercial. But if we compare our price level with that of Malaysia, ours is cheaper, except when compared with that of the US. The US has shale gas," explained Arifin.

Despite this, Arifin underlines the gas price setting by the Government must not put a burden on gas supplier industry. "Companies must not suffer losses, we have to understand and support each other," he added.

A day earlier at the State Palace, Arifin confirmed there is no price hike for industrial gas until the end of 2019. This decision was made after considering the competitiveness of domestic industries.

"Because we want our industries to be competitive. (Price of industrial gas) no increase. Because in this tough economic condition, if price is risen, adverse effects will be felt by industries. Industries also absorb many workers," Arifin explained. (IY)

Head of Bureau of Communication, Public Information Services, and Cooperation

Agung Pribadi (081122135)

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