Indonesia Cuts LNG Price for Industries to Boost Competitiveness

Indonesia has implemented a policy to reduce the price of liquefied natural gas (LNG) for certain industrial customers, aiming to bolster national competitiveness. The price for industries outside the fixed gas price (HGBT) category has been lowered to $13 per MMBTU.

This move specifically targets industries in West Java, Banten, and Jakarta that have faced disruptions due to a decrease in pipeline gas supply. The policy prioritizes labor-intensive and export-oriented sectors heavily reliant on natural gas.

PT Perusahaan Gas Negara (PGN), the gas subholding of PT Pertamina (Persero), has confirmed its readiness to implement the government's decision. PGN's Corporate Secretary, Fajriyah Usman, stated that the price reduction is achieved through cost optimization and efficiency improvements across the entire LNG supply chain, from upstream gas prices to processing, infrastructure, and trading.

Previously, rising global energy prices and dwindling domestic gas production had driven up LNG prices. Fajriyah explained that LNG prices inherently differ from pipeline gas due to additional costs associated with liquefaction, transportation, storage, and regasification. PGN assures that the implementation of this policy will not disrupt its operations and is committed to maintaining profitability while ensuring a reliable and sustainable gas supply.

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As a form of support for the Government's policy, the Company is ready to implement this policy while maintaining the profitability of the gas trading business and the Company's business as a whole.