Jakarta, Petrominer — After Petral was dissolved it seemed to make midstream sector was increasingly enthusiastic. The reason is there are many opportunities for national private able to work on various projects of this sector. Then how does the private catch these opportunities.
It is PT Nusantara Energi Plant Indonesia (NEPI) that participates in trying its luck in this sector. Its target is to supply oil fuel (BBM) and LNG for meeting the domestic needs for gas.
This national company launched its business strategy soon. Especially is to secure the supply of feedstock for the needs of oil fuel and the gas. The following is a brief interview of Petrominer and President Director of NEPI, Junaidi Elvis, in Jakarta some time ago.
As a private company what opportunity do you see?
Indonesia has become one of the biggest exporters in the world of liquefied natural gas (LNG) since the middle of 1970s, but there are power plants at scattered locations that still consuming oil fuel as electric generation system. This trend is caused by limited access for cheaper fuel because of islands and geographic hindrances. On the other hand, subsidy by the government for oil fuel for power plants is excessive. It needs to be handled at once by increasing the need for electrification ratio and good spirit for reducing government’s subsidy on diesel fuel.
Besides, in accordance with the National Natural Gas Policy Road Map of 2014-2030, within 5-10 years to come, the supply and the need for gas in Indonesia are going to experience deficit.
What is your plan?
We plan to build a LNG FSU (LNG Floating Storage Unit) with a storage capacity of 100 000 metric ton of LNG and regasification facility in Banyuwangi, East Java. This facility later will give LNG supply by operating mini LNG carrier to power plant in Bali and other power plants in various locations in Indonesia.
Concerning the plan to build an LNG Terminal, NEPI plans to develop Mini Refinery and Storage tanks with a processing capacity of 30 000 bpd for Mogas and Avtur products that are needed for domestic needs. We also plan to build a gas fired combined cycle power plant with a capacity of 1500-2000 Mw. Estimation of total investment of the projects is about US$1.6 billion and it is expected the projects can be completed within 2-3 years to come.
What strategy business do you carry out?
First we have to secure the continuity of feed stock in order not to be interrupted. We are the contract holder with Vitol for 30 years. So we have to cooperate with international trader for guaranteeing the feedstock. Nevertheless we also look at domestic purchase potential providing it is more competitive.
What is the benefit to the government?
To the government with the existence of the private role of course that is able to guarantee the national energy resilient. And to the regions with the existence of the projects, equalization of infrastructure that later will create work opportunities.
The important thing is this private side has to grow big and improved. The government also has to protect us as its offspring. But, thank God it has been applied now. Its proof, we have got tax holiday and other incentives from the government. (W18)
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