Indonesia reduces LPG imports

13 , 2012 | Source: Antara News

Vice President Boediono has said the government will increase the production capacity of the domestic liquefied petroleum gas (LPG) industry in an effort to reduce the country`s dependence on imported energy.


"LPG imports have been growing rapidly and will continue to do so in the future. Therefore, more investment is needed to increase the production capacity of the domestic industry," he said during his speech at the 25th World LPG Forum at Nusa Dua, Bali, on Wednesday.

Boediono noted that domestic LPG consumption had been rising rapidly after the government`s success in implementation of the kerosene-to-gas conversion programme launched in 2007.

The government will also develop the necessary infrastructure to ensure there is adequate LPG supply, he said.

Director General of Oil and Gas at the Energy and Mineral Resources Ministry Evita Legowo said LPG imports could be reduced by increasing domestic LPG production from fuel oil refineries and natural gas and by replacing LPG with dimethyl ether.

LPG is a side product of fuel oil refineries, she noted.

"The more fuel oil refineries we have, the more LPG production there will be," Evita added.

The government has planned to build three fuel oil refineries, which are expected to be operational by 2018-19.

Additionally, the government is also developing regulations on specifications for production of dimethyl ether, Evita said.

Meanwhile, Karen Agustiawan, the president director of state oil and gas company Pertamina, expressed hope that the government would make it mandatory for all gas producers to produce LPG.

At present, C3 and C4 which are raw materials for the production of LPG, are not separated from locally produced natural gas, she pointed out.

"Looking ahead, we need to make it compulsory for them to do so," Karen said.

Pertamina itself had separated C3 and C4 from natural gas to produce LPG, she noted.

National LPG consumption currently stands at 5 million tonnes per year, with 2.2 million tonnes coming from domestic production and 2.8 million tonnes being imported.

 

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