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Indonesia invites S.Korea to invest in terminals

LNG Industry,

Indonesia is planning to build three new FLNG terminals; Pertamina and PGN have formed a joint venture worth US$ 200 million to build the West Java terminal, which will supply Jakarta. Pertamina will also be building a terminal in East Java and PGN is building one in Medan, North Sumatra; both terminals will require investment of between US$ 150 - 200 million. The sites were chosen on the basis of the areas in the greatest need.

The three terminals are expected to have a combined capacity of between 3.5 and 4 million tpa, and will most likely also be used to import domestically produced gas which could then be processed onshore and used in power plants and factories. Though Indonesia is the world’s third biggest LNG producer, most of its production is tied up in long term export contracts forcing it to import LNG to meet rising domestic demand, and replace its dwindling reserves of crude oil.

“The building of LNG floating storage and regasification terminals needs huge investments. Therefore, we have offered the projects to South Korean investors,” said Evita Herawati Legowo, Director General of oil and natural gas at the Energy and Natural Resources Ministry. South Korea is already one of Indonesia’s largest foreign investors with large Korean electronics companies having a presence in the Indonesian market. The proposed terminals will also be discussed at the Third Indonesia-South Korea Energy Forum in Seoul.

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