PGN Assures Industrial Gas Supply Stability

Jakarta: PT Perusahaan Gas Negara (PGN) has responded to concerns over reports of reduced gas allocations and price adjustments for regasified liquefied natural gas (LNG).
 
PGN Corporate Secretary Fajriyah Usman said on Friday, June 26, 2026, “We understand the concerns, as global energy prices have risen in recent months, affecting LNG prices. We have also received feedback from associations and customers regarding this situation.”
 
“PGN will meet industrial natural gas demand through a portfolio of pipeline gas and regasified LNG. We ensure that gas supplies will remain available for all customers through June 2026,” Fajriyah said.
 
Fajriyah explained that LNG-based gas pricing could not be compared with pipeline gas pricing, as LNG involves additional costs stemming from procurement, transportation, storage, and the regasification process itself.
 
Procurement costs, in particular, have been driven by surging global energy prices, reflected in the Indonesian Crude Price (ICP), which rose from USD 64 per barrel in January 2026, to USD 117 per barrel in April 2026.
 
According to Fajriyah, PGN had absorbed rising costs in the first few months of the year. However, following an evaluation with the government, price adjustments were implemented in June 2026.
 
“This adjustment applies only to about 21 percent of the LNG-based supply, largely in the West Java region. The remaining 79 percent – including pipeline gas and supplies for the seven industrial sectors receiving the HGBT price – will remain unchanged," Fajriyah explained.
 
PGN emphasized that adjustments adhered to the Certain Natural Gas Price (HGBT) program, in accordance with the Decree of the Minister of Energy and Mineral Resources No. 250 of 2026.
 
“PGN fully adheres to the applicable regulations. If the upstream allocation volumes decrease, the HGBT volumes received by the industry will also decrease,” Fajriyah clarified.
 
The regulation governs recipients, volumes, prices, and supply sources as well as adjustment mechanisms in the event of reductions in upstream gas allocations.
 
PGN also said it would continue to coordinate with industry associations to seek solutions, including optimizing pipeline gas utilization and commercial schemes.
 

LNG prices projected to fall within three months

With global oil prices easing, PGN expects LNG prices to decline soon. “We expect LNG-based gas prices to decline within the next three months,” Fajriyah said.
 
PGN added that even after the price adjustments, LNG remains more competitive than industrial diesel or LPG. Domestic LNG prices also remain relatively low compared with those in several Southeast Asian countries.
 
Deputy Minister of Energy and Mineral Resources (ESDM) Yuliot Tanjung previously emphasized that there would be no increase in industrial gas prices under the HGBT program, as stipulated in the Regulation of the Minister of Energy and Mineral Resources No. 15 of 2022, amended by the Decree of the Minister of Energy and Mineral Resources No. 282.K/MG.01/MEM.M/2025.
 
“We have established HGBT prices. For electricity, the price remains at USD 7 per MMBTU. For the industrial sector, the program aims to enhance the competitiveness of domestic industries. The average price is around USD 6.5 per MMBTU,” he clarified.
 
Yuliot added that the government has also lowered gas prices for several strategic industrial sectors, particularly those focused on exports and downstream processing. “We have reduced prices for certain industries, from USD 8.7 per MMBTU to USD 8 per MMBTU,” he said.
 
“Domestically produced gas is being utilized to its fullest extent for national energy needs, serving both electricity generation and industrial raw material requirements,” Yuliot concluded.


(Jonathan Sianto)