PT Perusahaan Gas Negara (Persero) Tbk

INTEGRATING NATURAL GAS INFRASTRUCTURE TO MARKET

May 2014

GEO ENERGY CONFERENCE AND EXIBITION : 4th LNG Supply, Transport & Storage

PGN IS A STATE OWNED COMPANY WITH SPECIFIC MISSION TO PROMOTE THE DOMESTIC NATURAL GAS UTILIZATION THROUGH NATIONAL GAS MANAGEMENT

INTRODUCTION

• PGN is a natural gas provider

company through infrastructure

development such as transmission

and distribution pipeline or other gas

transportation mode.

• PGN is a national gas company who

owned the biggest infrastructure in

Indonesia

Exploration and Production Distribution and Retail

• PGN is developing to

a company with

complete portfolio of

gas management

competencies

PGN OWNED THE BIGGEST DOWNSTREAM NATURAL GAS INFRASTRUCTURE IN INDONESIA

INTRODUCTION

KALIMANTAN

Terbanggi Besar St.

Pagardewa Station

Panaran Station, Batam Duri

Grissik Receiving Station

Bojonegara Station Muara Bekasi Station Labuhan Maringgai St.

(Kilometer)

2.047 2.047 2.047 2.047 2.047

3.686 3.785 3.836 3.865 3.987

2009 2010 2011 2012 2013

Transmisi Distribusi

Floating Storage Regasification Unit

World natural gas consumption increase more than 100% since 1980 to 2010. The most increased natural gas consumption is in the Asia region, inline with the their economic growth.

WORLD ENERGY REFORM

OIL PRICE VOLATILITY STIMULATE THE INCREMENT OF NATURAL GAS UTILIZATION DEMAND IN THE WORLD

Source: EIA 2012

DOMESTIC GAS UTILIZATION IS INCREASING WHILE THE LNG EXPORT IS DECREASING

INDONESIA DOMESTIC UTILIZATION ANALYSIS OF NATURAL GAS

Natural gas production has increased by almost 25% between 2002 and 2012. While Indonesia is still exporting about half of its natural gas production, domestic consumption is increasing in tandem with production

Indonesia has 108 TCF of proven gas reserves or equivalent to 12 billion barrels of oil, almost 3 times of current Indonesia’s proven oil reserves. It makes Indonesia as 11th largest nation with gas reserves in the world

INDONESIA NATURAL GAS RESERVES

NATURAL GAS RESEREVE IS SCATTER THROUGHOUT INDONESIA ARCHIPELAGO

51.46

5.74

8.56

1.28

17.09

3.70 6.40

18.33

15.22

4.23

24.32

PROVEN = 108.40 POTENTIAL = 48.74 TOTAL = 157.14

Source: Indonesia Energy Statistic 2010 by MEMR Indonesia

• Development of natural gas market shall be analyzed inline with Indonesia economic development program.

• The Master Plan for Acceleration and Expansion of Indonesia Economic Development (MP3EI) 2011 – 2025 arrange all Indonesia’s archipelago with the specific focus in economic corridors

• From the specific characteristics of each economic corridor, the center natural gas demand can be determined

MAPPING INDONESIA’s NATURAL GAS MARKET

Corridor 1 - Sumatera Center for Production and

Processing of Natural

Resources (National Energy

Reserves)

Corridor 3 - Kalimantan Center for Production and

Processing of Natural

Resources (National Energy

Reserves)

Corridor 4 - Sulawesi Center for Production and

Processing of National

plantation, Agriculture,

Fishery, Oil and Gas & Mining

Corridor 5 – Bali – NT Tourism Gate and National

Food Supporting

Corridor 6 – Papua -

Maluku Development Center of Food,

Fishery, Energy, and Mining

Reg. I Reg.

II Reg.

III Reg.

IV

Reg.

VIII Reg.

IX Reg.

X

Reg.

XI Reg.

XII

Corridor 2 - Jawa Driver for National Industry

and Service Provision

Reg.

V Reg.

VI Reg.

VII

Center of Demand

Notes:

• Corridor 2 (Region V, VI, VII) is

defined as center of National

energy demand

• Energy Demand distributed at

corridors 1, 3, 4, 5, 6 is less than

demand at corridor 2, and can be

categorized as “City demand”

• “City demand” consist of

transportation, commercial and

household

MAPPING INDONESIA’s NATURAL GAS MARKET

MP3EI DEFINED THE CORRIDOR 2 - JAVA AS THE CENTER OF ENERGY DEMAND

INDONESIA’s SPECIFIC CHALLENGES TO PROMOTE GAS UTILIZATION

Malaysia

Thailand

Malaysia

Papua

New

Guinea

Timor-Leste

Supply Locus Demand Locus

East Indonesia

West Indonesia

• The natural gas reserves are mostly located in eastern part of Indonesia , and center of demand is located at western part of Indonesia

• The natural gas demand at eastern part of Indonesia are still developing with characteristic of small volume and scattered throughout the islands. Certain areas in western part of Indonesia are also has same type of demand.

• The aim is to deliver the gas from its sources to the market with right technology considering the Indonesia archipelago natural challenges

NATIONAL GAS INFRASTRUCTURE DEVELOPMENT

NATURAL GAS INFRASTRUCTURE DEVELOPMENT REQUIRE SYNCHRONIZATION OF SUPPLY – DEMAND – INFRASTRUCTURE PLANNING

DEMAND ROADMAP

+

SUPPLY PROFILE

INFRASTRUCTURE PLAN : CONECTING SUPPLY AND DEMAND WITH THE RIGHT TECHNOLOGY

PIPELINE LNG CNG

MINI LNG

PIPELINE DEVELOPMENT AT WESTERN INDONESIA

INTEGRATED PIPELINE TO CONNECT SUMATERA AND JAVA MARKET

Infrastructure networking development to the customer at North Sumatera

Improving reability networking system to customer at west java

Distribution networking development at east java

Distribution backbone development Lampung Distribution Networking

System Development

Panaran – Tanjung Uncang Pipeline Development

Improving capacity development

UTILIZATION OF SUPPLY SOURCE AT EASTERN INDONESIA

3

2

1

1 West Java FSRU Capacity 3 MTPA

2 Lampung FSRU Capacity 3 MTPA

3 Arun Regasification Capacity 1.5 MTPA

Deficit Surplus Source : Dirjen MIGAS 2012

DELIVERING THE NATURAL GAS FROM EASTERN INDONESIA THROUGH LNG TECHNOLOGY

UTILIZATION OF SUPPLY SOURCE AT EASTERN INDONESIA

DEVELOPMENT OF LNG RECEIVING TERMINAL AT WESTERN INDONESIA

LNG FSRU LAMPUNG PROJECT 170.000 m3 Storage Capacity

DELIVERING TO SPECIFIC CONDITION

Eastern Indonesia

Small islands at Sumatera & Java

DELIVERING SMALL VOLUME TO REMOTE AREAS USING MINI LNG OR CNG TECHNOLOGY

LNG

MINI LNG PLANT

LNG DISTRIBUTION

STORAGE & REGAS

END CUSTOMERS

CNG PLANT

CNG DISTRIBUTION

REGULATING STATION

END CUSTOMERS

MINI LNG INFRASTRUCTURE

CNG INFRASRUCTURE

Infrastructure Poetntial Supply

FSRU Lampung Tangguh

Distribusi Lampung Tangguh

Distribusi Semarang Gundih, Kepodang

Pipa Kalija Fase I Kepodang – Tambak Lorok Kepodang

Market Extension Jawa Bagian Barat Grissik, Tangguh

Pipa Distribusi Duri – Dumai Grissik, Tangguh

Inland Mini LNG Jawa Timur (Malang) BD, WMO

Infrastructure Potential Supply

Inter Island Mini LNG (Pomalaa – Halmahera) Tangguh, Masela

Pipa Transmisi Dumai – Medan Grissik, Tangguh

Market Extension Jawa Bagian Timur BD, WMO, Cepu

Market Expansion Jawa Bagian Tengah dan Timur

(Semarang, Jogjakarta, Solo)

Gundih, Kepodang,

Cepu

Pipa Kalija Fase II Bontang – Semarang Mahakam

Land Based LNG Receiving Terminal Jawa Barat Mahakam, Tangguh,

Masela

Pipa Transmisi Natuna – Jawa Natuna Timur

Mini LNG Hub Batam – Jatim – NTT Mahakam, Tangguh,

Masela

1

2

3

4

5

6

7

9

10

1

2

3 5

6

7 11

13

14

Natuna Timur

Mahakam

Tangguh

Masela

Eastern Indonesia Optimization of LNG Network

Western Indonesia Integrated Pipeline and LNG Receiving Terminal

Network distribution

Existing pipeline

Planned pipeline

FSRU

Plant

Land Based

LNG Carrier Route

Planned pipeline

8

11

13

8

8

9

10

4

14

15

15

15

15

12

12

PGN NATURAL GAS INFRASTRUCTURE DEVELOPMENT PLAN FOR INDONESIA: INTEGRATING NATURAL GAS INFRASTRUCTURE TO MARKET

Thank you