EMIS Emerging Market Information Service Indonesia Power Sector | Page 22

Gas Highlights
Overview
Indonesia produces about 3 times more gas than it consumes. However, there is a shortage of domestic needs. The state-owned company for transport and distribution of gas
Perusahaan Gas Negara (PGN) is unable to meet domestic demand. This in turn has serious consequences for the state electricity company Perusahaan Listrik Negara ( PLN ),
which is the largest domestic consumer of gas. The company is forced to buy more expensive and environmentally unfriendly fossil fuels (such as oil) to meet the needs of local
consumers. This problem is due to the fact that most of the produced gas is exported, as the industry is dominated by foreign companies that are willing to invest only if the export
of goods is allowed. Currently over 85% of the gas is produced by such foreign companies and only 15% of the state PGN.

Reserves
Indonesia has large reserves of gas - 3.18 trillion cubic meters. Currently the country has the third largest reserve of the countries in
Asia and ranks after Australia and China. Gas reserves in Indonesia amount in 1.4% of the world's reserves. Centers for gas
production are located in Sumatra, East Kalimantan, Papua and Natuna Island.
Shale Gas
Like many countries experiencing a shortage of electricity, Indonesia began to seek a solution in shale gas extraction. According to the Ministry of
Energy, the country has 574 trillion cubic feet (tcf) of shale gas resources, distributed as follows: Sumatra Island: 233 tcf, Kalimantan Island: 194
tcf, Papua Island: 90 tcf, Java: 48 tcf and other places: 9 tcf. Currently the country is trying to attract investment in the sector from the U.S.

Infrastructure
Indonesia currently has 8,000 km of gas pipelines. The government plans by 2025 to build 8 more infrastructure projects and thus
improve the access t