Indonesia plans for state energy company Pertamina to acquire state gas utility Perusahaan Gas Negara (PGN). The acquisition would give Pertamina greater control over the distribution of natural gas and reduce costs, the government says. PGN controls around 80% of Indonesia’s gas pipelines. Competition between the
Indonesia plans for state energy company Pertamina to acquire state gas utility Perusahaan Gas Negara (PGN).
The acquisition would give Pertamina greater control over the distribution of natural gas and reduce costs, the government says. PGN controls around 80% of Indonesia's gas pipelines.
Competition between the 2 state-owned enterprises has held up the government's goal of providing cheap fuel to households, according to Dahlan Iskan, minister for state-owned enterprises.
“Distribution of gas to households must become our focus. Gas should be for the people, not just for factories and exports,” Iskan said in a statement.
One scenario could be for PGN to acquire Pertamina's existing gas subsidiary, Pertagas, before it is swallowed up by Pertamina, Iskan said. Another could be for Pertamina to acquire PGN directly.
The government holds 57 percent of PGN, and investors including US fund managers such as Capital Group, Vanguard and Matthews International own the remainder.
Indonesia consumes about 40 billion cubic meters of gas a year, and demand is growing by at least 10% annually.