Govt terminates gas exports to Singapore, Malaysia

Jakarta (Antara News) - The Indonesian government has terminated its natural gas exports to Singapore and Malaysia in order to meet domestic demand for the commodity, a minister said.

Minister for Energy and Mineral Resources Purnomo Yusgiantoro said here on Thursday that the decision to stop gas exports to the two countries was based on Presidential Regulation No.5/2006, which calls for priorities to be given to domestic demand.

"We no longer accept any demand for new shipments to Singapore and Malaysia because all the production would be used at home," the minister said.

But he said that the government would still continue to supply natural gas under the on-going export contracts. "It is impossible for us to halt the exports if their contracts have already been signed," he added.

He said that the government would remain to respect the on-going export contracts.

On the high margin between the price of gas exports and that sold at home, the minister said the government would provide incentives for investors in the form of lower production sharing portion alloted to the state.

Based on the contracts, gas exports to Singapore and Malaysia came from the gas fields in South Sumatra and Natuna which were delivered through a pipe transmission owned by state-owned national gas company PT PGN.(*)
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