NATURAL GAS VALUE CHAIN, PREPARING COMPETITIVE DOMESTIC MARKET FOR THE FUTURE

摘要

Indonesia has large reserves of natural gas. At 2005, Indonesia's natural gas reserves are 185.8 TCF (trillion cubic feet). About 97.3 TCF is proven and 88,5 TCF is probable reserve. The production of natural gas is increasing from 2.98 TCF in 2005 to 8.217 TCF in 2006. About 53% of total gas production in Indonesia is exported to some countries such as Japan, China, and South Korea. Meanwhile, the rest of it is used in domestic market. At this time, the utilization of gas in domestic market share is only 13% from total energy mix in : Indonesia. By 2025, the use of natural gas is targeted to increase to 30%.There is a gap between global markets and domestic market price. Indonesia's natural gas price that exported to some countries is about $ 7-9 per MMBTU (CIF), while domestic price is about $ 5 per MMBTU. Consequently, oil and gas stakeholder presume that domestic market is less profitable because less netback value gained.This paper will analyze current status of natural gas economic value chain from wellhead, processing plant, and logistic to consumer. Value chain comparison between domestic markets and international market would show the netback value differences. Based on the comparison, the new recommended gas price for domestic market is decided. US $ 7.02 /MMBtu are reasonable price, prior to same netback with East Kalimantan to Japan LNG export. Increasing the gas economic value could support competitive domestic market. That condition will promote natural gas supply to meet Indonesia energy demand in the future.