Note! Government-Business Entity Gas Network Roads in 2025 News – 1 hour ago

Jakarta, CNBC Indonesia – The Ministry of Energy and Mineral Resources (ESDM) revealed that in the next 2 years, the natural gas distribution network program for households (jargas) with a cooperation scheme between the government and business entities could start running in 2025.

The Director General of Oil and Gas (Dirjen Migas) of the Ministry of Energy and Mineral Resources, Tutuka Ariadji, said that currently his party is carrying out a series of preparations to be able to revise the rules contained in Presidential Regulation (Perpres) Number 6 of 2019 concerning the Supply and Distribution of Natural Gas Through Transmission Networks and /or Natural Gas Distribution for Households and Small Customers.

The revision of the regulations was carried out to include the Jargas Government Cooperation with Business Entity (KPBU) scheme. Currently, Tutuka said that the applicable scheme is the government or business entity, not the government and business entity.

“So we are currently preparing through the Presidential Decree. Then there are other preparations until next year, so we hope that by 2025 (the PPP scheme) can be implemented,” he explained to CNBC Indonesia.

Currently, continued Tutuka, his party is exploring collaboration with various institutions/agencies to formulate plans starting from market sounding, user surveys and consumer surveys.

“How are we doing it? There are pilot (projects) in Batam and Palembang. It has been studied so far that it will be developed to 9 cities/districts,” he added. It is recorded that the program run by the government has only covered 800 thousand households over the past few years.

“With this PPP we hope it can be many times higher than the current (condition). We hope that hundreds of thousands (of households) will be close to that high every year, so that the target can be achieved,” he concluded.

He also said that if the government and business entities work separately, the costs incurred will be even heavier. Tutuka said that with the Jargas PPP scheme, the price setting mechanism can be carried out following the Jargas PPP scheme policy. “The pricing mechanism follows this policy so that the PPP program can run,” he concluded.

As is known, the government is targeting the construction of a natural gas distribution network for households (jargas) to reach 2.5 million household connections (SR) by 2024. This number has decreased compared to the initial plan which was targeted at 4 million SR.

Minister of Energy and Mineral Resources, Arifin Tasrif, said that the reduction took into account the progress of gas pipeline construction that has been underway to date. So far, only around 800 thousand SR have been built.

“The government should have 4 million connections in 2024 but now it is still below 800 thousand because only the APBN and PGN are working,” said Arifin at the Ministry of Energy and Mineral Resources Building, Friday (13/10/2023).

Therefore, the government will return to using the State Revenue and Expenditure Budget (APBN) which was previously no longer used. Then, the government will also encourage private business entities (Government Business Entity Cooperation/KPBU) to be involved in providing household gas infrastructure.

Thus, the government will revise Presidential Regulation (Perpres) Number 6 of 2019 concerning the Provision and Distribution of Natural Gas Through Natural Gas Transmission and/or Distribution Networks for Households and Small Customers.

“With the existing Presidential Decree, PPP is not included in the scheme, now the Presidential Decree will be revised so that PPP can run so that business entities can run, with this we can beat that target, so apart from PGN’s portion, there will be PPP later from the Ministry of Energy and Mineral Resources. ,” said Arifin.

In order to encourage business entities interested in building gas pipelines, the government will also set the upstream special gas price at US$ 4.72 per MMBTU.

[Gambas:Video CNBC]

Next Article

Japanese companies are flocking to the ESDM office, what’s going on?