Saturday, April 23, 2016

Pertamina Joins Medco Power in Pursuits for Chevron's Geothermal Assets

Jakarta. State energy company Pertamina has stated its interest in taking over geothermal assets on the pipeline to be sold by multinational oil giant Chevron.

Two Chevron subsidiaries now own and operate geothermal projects in Salak and Darajat fields — two geothermal working areas in West Java in which Pertamina also has a minority interest — with a capacity to generate 647 megawatts of power.

"We are interested in the projects. But, we still need to discuss it further," said Syamsu Alam, the upstream director at Pertamina on Monday (18/04).

Pertamina would compete with Medco Power Indonesia — controlled by Saratoga Capital and Medco Energi Indonesia, the country largest listed oil company — that is also is eager to buy the assets.

Chevron, like other global oil firms, are selling assets, cutting jobs and slashing capital spending globally to maintain profitability.
"Amid current weak global oil price, they have to restructure their business," said Rida Mulyana, the director general of new and renewable energy at the Energy and Mineral Resources Ministry.

Rida said that under current rule, Pertamina does not have any preferential right to purchase the projects from Chevron.

"Pertamina can always ask Chevron not to sell them to others, but in the end it would come down to the economics," he said.

Jakarta Globe

Two Indonesian Coal Ports Halt Shipping to Philippines on Hijack Fears

Jakarta. Authorities from at least two Indonesian coal ports have stopped allowing vessels to leave for the Philippines due to security concerns following a spate of ship hijackings in the southern Philippines, a government official said on Wednesday (20/04).

Departure permits for the Philippines were no longer available for shipping vessels at the Port of Banjarmasin in South Kalimantan and Tarakan in North Kalimantan, said Indonesia's acting director general of sea transportation Umar Aris.

"The situation in the Philippines is considered not safe and some of our ships were hijacked," Aris told Reuters.

"Tomorrow, I'll have a meeting with the Navy and State Intelligence Agency to further discuss the matter. We're trying to find the best solution."

A combined 18 crew from Indonesia and Malaysia have been taken captive in three separate attacks on tugboats in Philippine waters close to maritime borders with the two countries.


Wednesday, March 30, 2016

Govt Set to Revise Mine-Mouth Power Plant Pricing Scheme

Jakarta. The Ministry of Energy and Mineral Resources is considering a revision of the margin at which mine-mouth coal-fired power plants sell their electricity to Perusahaan Listrik Negara, arguing that the current margin hampers the state utility's ability to cut prices further.

Under the current scheme, coal miners own the power plants and sell the power to PLN at 25 percent higher than production costs. However, the state utility says lower coal prices, which are supposed to benefit its customers, have not been reflected in the scheme's pricing.

"We are now formulating a new, more flexible pricing scheme," Bambang Gatot, director general of minerals and coal at the energy ministry, said on Monday (28/03).

Bambang said the government would impose a floor and ceiling on miners' profit margins, in accordance with the agreement between the coal miners and PLN. However, the government has yet to determine what those levels will be, he added.

Ministry data shows that Indonesia's benchmark coal price has dropped 3.5 percent so far this year, following a 17 percent decline in 2015, as weak demand from China continues.

Mine-mouth power plants still account for just a fraction of PLN's total power capacity. Miners, such as state-controlled Tambang Batu Bara Bukit Asam, are keen to develop this type of power plant, as they can earn from their product than by shipping it in bulk.

Jakarta Globe

Ratchaburi Electricity to Bid for $350n Indonesian Power Plant Project

Bangkok. Ratchaburi Electricity Generating Holding, Thailand’s largest private power producer, is teaming up with Indonesian firm Medco Power to bid to build a $350 million power plant in Indonesia, a company executive said on Thursday.

Facing limited growth at home, the utility is seeking to expand abroad as it aims to boost power generation capacity to nearly 10,000 megawatts by 2023 from just under 7,000 MW now.

As well as Indonesia, it is looking to invest in Vietnam, the Philippines, Australia and Laos, Chief Business Development Officer Paskorn Dangsamakr told reporters on Thursday.
The utility expects to submit a bid with Medco in June for the 250 MW gas-fired plant in the Riau Islands and start building within a year if it wins, Paskorn said. Medco would take a 51 percent stake and Ratchaburi 49 percent, he said.

Ratchaburi is also keen to bid for a 800-MW gas-fired plant in Java, Paskorn said.

The utility is also considering buying a 30-40 percent stake in coal-fired power plant from GN Power in the Philippines, he said.

In January Ratchaburi bought a 10 percent stake in a nuclear power plant in China, where it will partner China General Nuclear Power Group (CGN) and Guangxi Investment Group Co to build and operate a second plant in Fangchenggang, in Guangxi province.

Ratchaburi has no plans for now to build a nuclear power plant in Thailand, but the Chinese deal would leave it better placed should the government decide to include nuclear in the energy mix, Chief Executive Rum Herabat said.

The project would give Ratchaburi access to technology, experience in the construction and commissioning of a nuclear plant, and training for personnel, he said.

The 7.5 billion baht ($212.28 million) investment would also provide a “double-digit” return on investment, he said.

Thailand has considered atomic energy in its long-term plans but there is strong political opposition and the government put off plans to build a reactor by 2020 following the Fukushima disaster in Japan in 2011.

However, a government power development plan issued in late 2015 envisages two 1,000 MW nuclear power plants being built for start-up in 2035 and 2036.


Monday, March 21, 2016

Indonesia's Pertamina Looks to India to Process Iraqi Crude

Jakarta. Indonesian state-owned energy company Pertamina hopes to seal a deal this year with an Indian refiner to process around 1 million barrels of Iraqi crude oil each month, its chief executive said.

"It is better if we purchase the crude and then utilize a refinery overseas," Pertamina CEO Dwi Soetjipto told reporters late on Monday.

"Why India? Because its geographic location is good," he said. Any crude shipments from Iraq would pass several Indian oil ports on the way to Indonesia.
Soetjipto declined to say which Indian refiner Pertamina was talking to on the oil processing 

Pertamina's monthly Iraqi oil shipments to the Indian refiner would consist of 290,000 barrels from a stake in the West Qurna block and another 700,000 barrels it would purchase from other Iraqi oilfields, he said.

Pertamina has about 1 million barrels per day (bpd) of domestic refining capacity, which meets only about two-thirds of Indonesia's daily oil consumption.


Friday, March 18, 2016

Indonesia Seeks Buyers for 3-4 Uncommitted 2016 LNG Cargoes: SKKMigas

Jakarta. Indonesia is seeking buyers for "three to four" uncommitted liquefied natural gas (LNG) cargoes from its Bontang refinery operated by state energy company Pertamina in 2016, an official from the country's energy regulator, said Wednesday.

"If there's a domestic buyer that wants them we'll prioritize them for domestic use," SKKMigas vice president of gas commercialization Sampe L. Purba told reporters, noting that these were the country's only uncommitted cargoes for 2016.

Indonesia is expected to consume 60 LNG cargoes in 2016, Purba said, 80 percent of which will be used to generate electricity.

Indonesia's exports of liquefied natural gas (LNG) declined by 3 percent to 811 trillion British thermal units (17.03 million metric tons) in 2015 from 834.2 TBTU in 2014, data presented by the upstream oil and gas regulator (SKKMigas) showed on Wednesday.

Domestic consumption of the super-cooled fuel in 2015 rose 31 percent to 114 TBTU from 86.7 TBTU in 2014, the data showed.


Monday, February 29, 2016

State Procurement Agency Bulog to Import 200,000 Tonnes of Corn in 1Q

Jakarta. Indonesia’s state procurement agency Bulog will only import 200,000 tonnes of corn in the first quarter, lower than previous indications the government would bring in up to 600,000 tonnes, a company executive said on Thursday (25/2).

Indonesia’s government has banned corn imports since July last year, but some feedmills had already imported 445,000 tonnes, data from the trade ministry showed.

The corn, already at some ports in Indonesia, was banned from being unloaded.
Wahyu, director of the food procurement agency, said Bulog will buy the rest of the corn it needs from those feedmills.

“Our target is that by the end of March, this will be done,” Wahyu told reporters.
Bulog is the sole importer of corn for Indonesia starting this year. The corn that Bulog imports is supposed to be sold to feedmills.

Up to Thursday, Bulog has imported 40,000 tonnes of corn in 2016, Wahyu said.
Bulog was supposed to have imported 100,000 tonnes in January and another 200,000 tonnes 

in February, Wahyu said on Jan. 19. European corn traders also said at the end of last month that they sold 100,000 tonnes of corn for January arrival.

Wahyu did not explain the discrepancy further on Thursday.

Southeast Asia’s largest economy imports corn mainly from Argentina and Brazil.