PT Perusahaan Gas Negara (PGN) has confirmed it is prepared to implement the Indonesian government’s directive to sell liquefied natural gas (LNG) to domestic industry at a capped price of US$13 per million British thermal units (MMBtu).
The state-owned distributor stated it fully supports the policy, which aims to protect local manufacturers and preserve employment amid escalating global energy costs.
The price ceiling represents a significant intervention in Indonesia’s domestic energy market, effectively decoupling industrial gas prices from volatile international benchmarks.
By locking in a lower rate for key sectors, the government seeks to maintain competitiveness for Indonesian exports and stabilize production costs for energy-intensive industries.
PGN’s compliance signals that the state-owned enterprise will absorb the margin pressure associated with the differential between global spot prices and the mandated domestic rate.
This development follows PGN’s recent efforts to expand domestic supply, including plans to bring an additional 5 million standard cubic feet per day (MMSCFD) of natural gas to market by tapping the Sengeti field in Jambi province.