Natural Gas Beyond Pipeline: CNG from Subholding Gas Pertamina Now Flowing in Balikpapan

Jakarta, 10 July 2024 – PT PGN Tbk, as Subholding Gas Pertamina, together with its subsidiary PT Gagas Energi Indonesia ("Gagas"), has once again reaffirmed its commitment to expanding the utilization of natural gas through the beyond pipeline method. This time, PGN and Gagas have started serving CNG (Compressed Natural Gas) customers in Balikpapan, East Kalimantan, for the first time.

Previously, PGN, through Gagas, introduced Gaslink to new areas such as Denpasar and Palembang in 2023. This year, the distribution of natural gas in Balikpapan has successfully commenced. PGN and Gagas have started supplying natural gas to PT Bumi Liputan Jaya (Blue Sky Hotel) with a delivery volume of 700 MMBTU per month. This initiative is also part of PGN's effort to support the development of Indonesia's new capital city (IKN).

Supporting IKN Development
PGN has been tasked by the government to provide gas infrastructure in IKN, particularly for residences or official houses for ministers and employees. In the initial phase, gas connections will be installed in 166 apartment towers (ASN residences) and 34 standalone ministerial houses. The natural gas supply will be delivered in the form of CNG sourced from Balikpapan or Bontang in East Kalimantan.

Blue Sky Hotel plans to utilize natural gas for kitchen and laundry operations. “We hope that the use of natural gas will ease hotel operations and provide up to 25% savings in fuel costs,” said Rachmad, Chief Engineering of Blue Sky Hotel.

Beyond Pipeline Development in Kalimantan
PGN Commercial Director Ratih Esti Prihatini stated that the development of natural gas utilization in Kalimantan by the PGN Group is predominantly carried out using the beyond pipeline method. Additionally, natural gas services for households are also managed by the company’s affiliates. “Our aim is to provide customers with energy that is efficient, practical, safe, available 24/7, and environmentally friendly,” Ratih said.

Acting President Director of Gagas, Enro Situmorang, explained, “We are starting natural gas distribution in Kalimantan through Balikpapan, with a projection to supply up to 1,500 MMBTU per month for industrial and commercial sectors by the end of 2024. We hope other cities in Kalimantan will experience similar benefits,” he added.

Enro further noted that Gagas, together with PGN, is committed to supporting the government in achieving Net Zero Emissions by 2060, one of which is through the expansion of natural gas utilization as a transitional energy. “Our current focus is to broaden the use of natural gas, especially in cities or regions not yet reached by PGN's pipeline network,” Enro stated.

Infrastructure and Future Plans
The distribution of natural gas in Balikpapan will be supported by the Gas Filling Station (SPBG) in the city. Compressed Natural Gas (CNG) will be transported to customer locations using Gas Transport Modules (GTM). Besides CNG, PGN is also preparing to introduce the use of Liquified Natural Gas (LNG) for Balikpapan and its surrounding areas. LNG, with its larger capacity, will cater specifically to industrial customers requiring greater volumes of natural gas.

This initiative represents a significant step in PGN’s commitment to providing sustainable and reliable energy solutions while contributing to Indonesia’s environmental and economic development.

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