ESDM Ministry Still Finds the Best Option to Lower Industrial Gas Price

By : Hariyanto And Aldo Bella Putra | Thursday, January 25 2018 - 17:00 IWST

Wakil Menteri dan Sumber Daya Mineral (ESDM) Arcandra Tahar

INDUSTRY.co.id - Jakarta - The government continues to seek the best option to reduce the price of the industrial gas economy to US $ 6 per MMBTU in accordance with the mandate of Presidential Regulation No. 40/2016.

One of them is through the reduction of State Revenues allocation from natural gas so that gas industry can get competitive gas price and grow optimally.

Nevertheless, Vice Minister and Mineral Resources (EMR) Arcandra Tahar said the plan is still being discussed and awaiting decisions under the Minister of Finance.

"The Minister of Finance said that this effect will be eliminated, because the state revenue will decrease as well, we will wait from the Minister of Finance," explained Arcandra in Jakarta, Tuesday (23/1/2018) night.

This consideration considering the impact of the abolition of Non-Tax State Revenue (PNBP) from natural gas has no significant effect on industrial gas price decline in accordance with Perpres 40/2016.

"It could be less US $ 0.7, some US $ 0.3, very small effect, and not under USD 6," said Arcandra.

Even if this is done, then the potential revenue of the country could be reduced to US $ 4.3 million. "We have calculated, the amount of PNBP loss of about US $ 4.3 million," said Arcandra.

To date, 56 of the 80 companies recommended by the Ministry of Industry are being calculated for the abolition of non-tax revenues. The total gas requirement of the 80 companies is 21 MMSCFD which the company is out of the three types of companies that have already experienced price declines, namely steel, fertilizer and petrochemical.

"For three (types) the industry is finished, four types of industries are small," said Arcandra.

The four types of industries referred to by Arcandra are ceramics, glass, gloves, and oleo chemicals.

Even so, the elimination of PNBP is still the best choice while still evaluating rather than having to cut prices in upstream oil and gas. Moreover, world oil prices continue to climb to another consideration.

"If ICP is only 11% ICP is now US $ 60, 11% is US $ 6.6, its LNG only, so how much more can be deducted? Deducted the upstream? Contract it's finished upstream," said Arcandra.