PT Pertamina (Pertamina), Indonesia’s state owned oil & gas company, and PT Perusahaan Gas Negara (PGN), Indonesia’s largest gas distributor, signed a memorandum of understanding (MoU) at the end of January regarding a plan of cooperation to facilitate gas distribution to natural gas refueling stations (SPBG) in Indonesia.
The MoU builds on a report last December, which stated PGN had recently identified 73 fuel stations in the Greater Jakarta area that could become multi-fuel outlets.
Pertamina’s Director of New & Renewable Energy and signatory to the MoU, Yenni Andayani, explained this cooperation between Pertamina and PGN will take advantage of natural gas pipelines owned for the distribution of gas fuel for transportation in Indonesia. This cooperation is a form of synergy in an effort to accelerate the development of natural gas infrastructure for the transport sector, and to support the conversion to CNG fuel.
The transition to compressed natural gas, referred to in Indonesia as ‘bahan bakar gas’ or BBG, is part of the Indonesian Ministry of Energy’s fuel diversification ‘Go Green’ program.
“Cooperation between the two companies will be a significant milestone for efforts to accelerate the implementation of CNG fuel conversion program, particularly from the aspect of supply. The synergy between Pertamina that has the power network in the retail business and PGN gas pipelines supplying gas enables the acceleration of gas refueling infrastructure in Indonesia to be accomplished,” said Yenni.
Pertamina has identified retail stations that intersect with PGN gas pipelines in multiple clusters. Later station development will be prioritized based on proximity to PGN infrastructure.
PGN Commercial Director Jobi Triananda Hasjim, also a signatory to the MoU, conveyed that through this partnership it is possible for Pertamina to tap into PGN pipeline to build SPBGs that are integrated with Pertamina retail fuel stations.
“We are delighted to work together with Pertamina in the provision of infrastructure for the fulfillment of natural gas into the transportation sector. With the development of integrated SPBGs, we expect to meet the needs of gas fuel for the transportation sector in Indonesia,” said Jobi.
Strategic development and integration of gas stations is believed to minimize existing barriers to SPBG development, such as land acquisition and licensing, so that construction of SPBGs is faster and more efficient. Pertamina will add CNG filling facilities such as dispensers, compressors, gas dryer and other facilities, completing each installation in about four months, much faster than building SPBGs from scratch.
Yenni commented that the success of this conversion program also requires the support of government policies related to the availability of converter kits, installation of adequate prepared workshops, and incentives to vehicle manufacturers that produce natural gas vehicles. Local governments can contribute significantly through policies that require all public transport and taxis to use gas to ensure the CNG fuel conversion program runs fine.
“Pertamina and PGN is committed to providing an SPBG network integrated with the broader retail outlets. However, the efforts of the aspects of the supply (supply side) will be more effective if it gets strong support from all stakeholders, especially the central and local governments,” Yenni said.
Pertamina retails CNG under the brand name of Envogas.