JAKARTA (TheInsiderStories) – Indonesian government is targeting to build trans-Kalimantan gas pipelines with costs up to Rp35 trillion (US$2.5 billion), said the official today (08/01). The development will not use State Budget funds but will collaborate with an investor for 30-year concessions.

Head of Downstream Oil and Gas Regulatory Agency Fanshurullah Asa said in the Master Plan for 2012-2025, the development of Trans-Kalimantan gas pipeline along 2,019 kilometers, stretching from Bontang – Banjarmasin – Palangka Raya to Pontianak.

“The gas pipeline is to transport natural gas from Bontang and Natuna and to meet the energy needs of natural gas throughout Borneo Island,” Asa told media in Jakarta on Thursday (08/1).

However, he added, in order to launch gas pipeline, there must be an additional demand. He hopes that the plan to move the state capital to Kalimantan, developing Special Economic Zones and industrial estates will drive the demand.

Based on Indonesia’ Natural Gas Balance 2018 – 2027, the potential for developing gas resources in the Kalimantan region is still very large. The supply of natural gas in the Kalimantan region in 2024 is estimated to reach 2,609.49 Million standard cubic feet per day (MMSCFD), consisting of existing 1,388.09 MMSCFD, on-going project 26.91 MMSCFD and two upstream projects that will first gas in IDD and ENI of 1,218.20 MMSCFD.

In addition, the potential for excess natural gas supply as much as 40 liquefied natural gas (LNG) cargoes until the year 2025 for which there is no buyer (uncommitted) of 116,769.6 MMSCF or equivalent to 1,599.5 MW, which comes from two main gas facilities that Indonesia currently has, namely LNG Tangguh in East Java and Bontang in East Kalimantan.

In 2018, the natural gas demand in the Kalimantan region was only 622.51 MMSCFD. It’s estimated that supply and demand for natural gas on Kalimantan Island has a surplus during 2018-2027, which has been mostly processed into LNG which is distributed to fulfill the commitments of Domestic and Export LNG.

However, this has not been optimally utilized, especially in the Kalimantan region for transportation use, small households and customers, oil lifting, fertilizer industry, natural gas-based industries, power plants, and gas-fueled industries. These shortcomings will be overcome through the utilization of natural gas through the Trans Kalimantan pipeline.

US$1=Rp14.000

Written By Willy Matrona Email@TheInsiderStories.com