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Pertamina discontinues LNG terminal project, seen as unfeasible

Indonesia's state owned energy holding company, Pertamina, has decided not to go ahead with what would have been the country's second land-based receiving terminal for liquefied natural gas (LNG), its chief executive said.

Indonesia has forecast sharp increases in gas demand after 2020, but increases in domestic consumption of the super-cooled fuel have been hampered by an abundance of cheap coal and sluggish development of gas infrastructure.

"Today we are not going ahead, because it is not yet feasible to continue," Pertamina acting CEO Nicke Widyawati told reporters, referring to the project that would have been built in Bojonegara, not far from Jakarta.

The terminal, valued at up to $800 million, was to be developed in a joint venture between Kalla Group unit Bumi Sarana Migas and Pertamina, with financing from the Japan Bank for International Cooperation (JBIC).

The 4-million-tonne-per-year terminal was to be designed by the engineering unit of Tokyo Gas Co Ltd and was expected to come onstream in 2019.

"Gas demand has declined so it's not feasible from a business standpoint," Widyawati added, noting that if gas demand for power generation increased the decision to halt the project may be reviewed.

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From the April 2018 issue of Hydrocarbon Processing

 

 
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