Indonesia Promotes Piped CNG and Mini-LNG to Cut LPG Import Dependency

Jakarta – Indonesia is taking significant steps to curb its escalating dependence on imported Liquefied Petroleum Gas (LPG), with the upstream oil and gas regulatory body, BPH Migas, spearheading efforts to promote Compressed Natural Gas (CNG) and mini-Liquefied Natural Gas (LNG) for household consumption. This strategic push is not merely about diversifying energy sources; it's a critical move to alleviate the substantial burden that LPG imports place on the national budget.

According to BPH Migas, the current reliance on imported LPG hovers around a staggering 81% of the nation's total demand. This dependency not only strains fiscal resources, with subsidies amounting to trillions of rupiah annually, but also highlights a vulnerability in the country's energy security. The proposed shift towards piped CNG and mini-LNG is presented as a more efficient, cleaner, and ultimately more economical solution for Indonesian households.

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This energy choice can increase the effectiveness of gas distribution and support the government's target in converting energy to safer, cleaner, and more efficient energy.

The government has set an ambitious target of establishing 350,000 new household gas connections by 2029, a goal that BPH Migas believes can be accelerated through expedited regulations and public-private partnerships. The initiative also includes converting existing Gas Filling Stations (SPBG) into Mother Stations for CNG and utilizing mini-LNG for non-piped distribution, particularly in challenging geographical areas like Eastern Indonesia. This comprehensive approach underscores Indonesia's determination to achieve greater energy self-sufficiency and transition towards more sustainable energy practices, a narrative that resonates strongly within the archipelago's development discourse.

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With the same price as 3-kilogram LPG, the state can save 30 percent because the subsidy is lower than the LPG subsidy.