PGN Supports Acceleration of Cisem Phase II Pipeline Utilization to Boost Investment

Batang – Pertamina Gas Subholding, PT PGN Tbk, together with its subsidiary PT Pertamina Gas (Pertagas), is committed to supporting the utilization of the Cirebon–Semarang Gas Transmission Pipeline Phase II (Cisem Phase II Pipeline), which was inaugurated by the Minister of Energy and Mineral Resources (ESDM), Bahlil Lahadalia, on Monday, September 30, 2024. The Cisem Phase II project will complement Phase I, completed in 2023, which has been operational to supply natural gas to the Kendal Industrial Area and the Batang Integrated Industrial Estate.

The first welding ceremony for the Cisem Phase II Pipeline project was attended by Acting Director General of Oil and Gas Dadan Kusdiana, Head of SKK Migas Dwi Soetjipto, Acting Governor of Central Java Nana Sudjana, Director General of Oil and Gas Infrastructure Planning and Development at the Ministry of Energy and Mineral Resources (KESDM) Laode Sulaeman, PGN President Director Arief Setiawan Handoko, PGN Director of Infrastructure and Technology Harry Budi Sidharta, and Pertagas President Director Gamal Imam Santoso. Also present were the President Director of KIT Batang, representatives of the KSO PT Timas Suplindo - PT Pratiwi Putri Sulung consortium, and other stakeholders involved in the Cisem II Pipeline project.

Minister of Energy and Mineral Resources Bahlil Lahadalia stated that the Cisem II Pipeline represents the government's effort to accelerate investment, particularly in KIT Batang. He emphasized that one of the master plans is to make the area a comparative advantage over other industrial areas by building infrastructure, including gas infrastructure for fuel. “Cisem I and Cisem II are like toll roads – toll roads for gas,” he remarked.

Bahlil added that the Cisem II Pipeline reflects collaboration between the government, state-owned enterprises (BUMN), and the private sector. "It is hoped that after the welding phase, PGN will manage the pipeline," Bahlil said.

"This project is one of the National Strategic Projects established by Presidential Regulation Number 3 of 2016, aiming to support the strengthening of sustainable national energy infrastructure and create efficiency in natural gas distribution to boost national economic growth," said Acting Director General of Oil and Gas Dadan Kusdiana.

The gas source for the Cisem II project comes from the Jambaran Tiung Biru (JTB) Field and the Long-Term Plan (LTP), leveraging the potential of all working areas (WK) in East Java (Agung and Bulu WKs). Beneficiaries of the Cisem II Pipeline project include the Cilacap Refinery, Balongan Refinery, various industries in West Java, household gas networks, and additional demand from Pupuk Kujang.

"PGN and Pertagas, as part of Pertamina's Oil and Gas Holding, are ready to support the utilization of the Cisem II Pipeline. Connecting Cisem Phase I with Cisem Phase II will significantly benefit natural gas supply. As envisioned by the government, we are prepared to manage, distribute, and monetize natural gas to attract investors and stimulate the economy," said PGN President Director Arief Setiawan Handoko.

Arief added that PGN will have greater flexibility in distributing natural gas, particularly from East Java to central and western Java markets. PGN is ready to ensure operational management to guarantee supply certainty for households, small businesses, commercial industries, and others, contributing to the economic growth targeted by the government.

One optimization plan for utilizing the Cisem II Pipeline is the planned gasification of Refinery Unit IV Cilacap (RU IV Cilacap), aligned with integrating natural gas transmission pipelines across Java Island. PGN plans to build gas distribution infrastructure with the Tegal–Cilacap Pipeline. This pipeline will expand the reach of natural gas infrastructure in southern Java and potential customers along the pipeline route, increasing natural gas utilization.

The Tegal–Cilacap Pipeline project is scheduled to begin in 2025, with commissioning planned for Q3 2026, transporting 51 MMSCFD to RU IV Cilacap. Currently, PGN and PT Kilang Pertamina Internasional (KPI) have signed a Heads of Agreement (HOA) on natural gas sales for RU IV Cilacap. The commercial agreement, FEED implementation, and licensing are in progress.

"Pertagas is ready to fulfill its mandate to manage the Cisem II Pipeline to ensure operational reliability in transmission, continuing the successful operations of Cisem Phase I. Our portfolio will be leveraged to ensure a more sustainable supply of gas transported and distributed through the Cisem II Pipeline in the future," said Pertagas President Director Gamal Imam Santoso.

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