LNG for Mining Sector Transportation, Pertamina and Indominco Conducted Pilot Project

12/8/2013 12:06:44 PM

JAKARTA – PT Pertamina (Persero) through the synergy of three subsidiaries, PT Pertamina Gas, PT Nusantara Regas, and PT Badak NGL, cooperates with PT Indominco Mandiri to conduct a pilot project on the use of NGL as the fuel for transportation in mining sector.

This Pilot project is the next step of a successful LNG utilization on school bus of Badak NGL before. In the future, it is hoped that the utilization of NG for transportation, such as mining sector, plantation, industry, buses, trains, and ships can be done in a short period of time. The first shipment of LNG for the pilot project had been done on Friday, 6 December 2013 in Bontang, East Kalimantan attended by Directorate General of Oil and Gas Edy Hermantoro and General Director Pertamina Luhur Budi Djatmiko, management of Pertamina subsidiaries and also Indominco Mandiri.

In his speech, Luhur said that this program is part of the energy diversification effort by utilizing LNG as the fuel in transportation sector. This effort is believed to be successful because is already supported by proven technology and implemented in several countries such as the United States, Canada, Australia, and China.

As the Pertamina Pilot project, LNG will be applied to the coal mining vehicles of Indominco Mandiri in Kalimantan which will be implemented until 2014. In the first stage, LNG will be used for Hauling Truck Volvo FH 16 550 HP that is already equipped with the converter it before applied to other heavy duty vehicles such as inpit dump truck and tug boat. Starting 2015 or at the end of 2014, Pertamina will prepare the commercial stage until full scale project. On the full scale project, the needs of LNG in all heavy duty vehicles of Indominco is estimated at 160.000 m3 per year.

“This step is a breakthrough of Pertamina corporate act to support government program to diversify and convert the use of fuel to gas/LNG to maintain national energy sustainability. We also appreciate Indominco Mandiri as a coal mining company that became one of the pioneer companies in using LNG for its operational vehicles. We hoped that this synergy will become a good example for the effort of NG utilization in transportation," Luhur said.

Pertamina projected that the use of LNG in transportation will reach 0,4 million ton per year in 2015 and will reach 1,3 ton per year in 2019 with the assumption that it will be used for coal mining vehicles and plantation, lon distance buses, excluding the trains and ships. With the total use of LNG, diesel fuel volume can be decreased for 0,9 kiloliter in 2015 and about 3 million kiloliter in 2019.

Efficiency for the company as LNG user as well as foreign exchange savings as the implication of diesel fuel import decrease potentially will rise if accompanied by a better and faster infrastructure establishment.

In terms of the energy needed, Indominco as the consumer of LNG as its fuel will obtain efficiency for 27% which automatically will increase consumer competitiveness. The use of LNG as vehicle fuels also beneficial to decrease carbon emission and on the other hand there is a potential of receiving incentive from Clean Development Mechanism (CDM) of the energy sector.

On the same occasion, Directorate General of Oil and Gas, the Ministry of Energy and Mineral Resources ESDM Edy Hermantoro said that the diversification program from fuel to LNG for the transportation is suitable with the Law No.30 year 2007 about the Energy that mandates the diversification to decrease the use of Natural Oil. The corporate act of Pertamina and Indominco also in line with the presidential regulation No. 5 year 2006 that the target of energy mix towards 30% of gas and oil use from 51% to 20% in 2025.

“The government give their appreciation and support towards the corporate act done by Pertamina in  implemented the diversification program from fuel to LNG thorough this pilot project and will be continued with a commercial full scale project. This program is a milestone for LNG user as the effort of fuel diversification," he explained.