The Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan said the government would not approve new gas export contract extensions. This is done because the government plans to stop gas exports.
Regarding stopping gas exports abroad, according to Luhut, this policy is still awaiting approval from President Joko Widodo (Jokowi). What’s clear is that none of the gas export contracts will be extended, but those that have been running will still be permitted until the contract period expires.
“If the contract has been completed, we will not extend it, that’s the point. But later, we’ll have to wait for the meeting with the President. We will respect all existing contracts. Only when completed, expired, there will be no new contracts,” said Luhut at the Danareksa Tower, Central Jakarta, Monday (24/7/2023).
Luhut said natural gas (LNG) in Indonesia would be used for the downstream industry in Indonesia and if it could be used to replace it with LPG. The reason is, he said that so far most of natural gas has been exported but Indonesia still imports LPG.
“So, why should we export our gases, which we can downstream the industry for? So far, we have been importing LNG or LPG. Why isn’t it made domestically,” Luhut said.
Luhut previously stated that he would propose to President Jokowi to stop gas exports when talking about gas downstream.
“We might suggest to our president not to export our gas outside anymore. If there is an existing contract, go ahead, but stop it if it expires,” Luhut said at the CNBC Indonesia Economic Update program.
It seems that the discourse proposed by Luhut will be supported by SKK Migas. Deputy for Finance and Commercialization of SKK Migas Kurnia Chairi explained that the government’s policy is to optimize gas utilization for domestic use.
“Regarding the export ban, I think I said earlier, that indeed the government’s policy is to use it for domestic use,” he said in a press conference for the upstream oil and gas industry in semester I-2023, Tuesday (18/7/2023).
His party will continue to encourage the industry to absorb gas. As is the case with fertilizer factories in Papua.
“We will continue to encourage the domestic industry to be able to utilize our gas. In Papua, we will encourage the construction of a urea plant, then a methanol plant in Bojonegoro, then maybe blue ammonia,” he said.
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