|
State gas distributor PT PGN will raise the price of natural
gas sold to households and industries by 10 percent in August,
following an increase in gas producers' prices.
The price will be tagged at US$5.5 per million British thermal units
(mmbtu), as compared with the existing price of $5 per mmbtu, said PGN
president director Sutikno during a hearing with the House of
Representatives' energy commission Monday.
He said that the rise was in line with the increased price being
charged for natural gas by the producers, including state oil and gas
firm PT Pertamina. The gas price increased by 60 percent to $4 per
mmbtu in April from $2.5 per mmbtu previously.
Sutikno was quick to add, however, that the price was still much lower
than liquefied petroleum gas (LPG) and diesel, which stand at $14 per
mmbtu and $17 per mmbtu, respectively.
"We have asked our customers about this and most of them don't seem to
mind about the price increase. What bothers them is the supply issue; I
think they will take whatever price we offer as long as we can
guarantee supplies," Sutikno said.
The increase will be the company's third in two years.
The company distributed 323 million cubic feet of gas to household and
industrial customers in 2006 -- a 4.8 percent increase from 308 million
cubic feet in 2005.
It expects to increase natural gas supplies to 555 million cubic feet
this year. In the first quarter of 2007, it managed to increase
supplies to 369 million cubic feet.
In its presentation to legislators, the company said it would also
expedite the construction of project consisting of two pipelines
linking South Sumatra and West Java (SSWJ) so as to increase gas
supplies to industrial areas of West Java.
However, Sutikno said that flooding due to torrential rain along South
Sumatra's Musi river would likely cause a two-month delay in the
construction of the Grissik to Pagardewa section of the first pipeline,
which was previously expected to be completed in July.
The Grissik and Pagardewa fields are both located in South Sumatra,
with the delayed section forming part of the fist pipeline connecting
ConocoPhilips' gas field in Grissik to West Java's Muara Bekasi
industrial area.
The second pipeline project, which connects Pertamina's gas field in
Pagardewa to industrial areas in Muara Bekasi, was on schedule, Sutikno
said, and due to be completed in July.
This July, the company is supposed to deliver 200 million cubic feet
transmitted along both of the pipelines.
The $1.1 billion SSWJ project comprises two pipeline tracks spanning a
total of 1,106 kilometers from Grissik in South Sumatra to West Java.
The project, which commenced in 2005, will supply clean fuel to the
gas-starved areas of Muara Bekasi, Rawa Maju and Bojonegara in West Java.
|
