Pertamina Gas Subholding Pioneers Utilization of 36,500 MMBTU Bio-CNG for Retail Customers in Indonesia

Jakarta – PT PGN Tbk, as Pertamina’s Gas Subholding, is advancing efforts to promote the use of biomethane derived from Palm Oil Mill Effluent (POME) in Indonesia. Through its subsidiary, PT Gagas Energi Indonesia (Gagas), PGN is implementing the compressed biomethane (Bio-CNG) utilization agreement in partnership with PT KIS Biofuels Indonesia (KIS).

This marks the first Bio-CNG utilization initiative for retail customers in Indonesia. Initially, KIS will supply 36,500 MMBTU of Bio-CNG to Gagas in the first year, with the potential to increase supply by up to 100% by the fifth year.

PGN’s Director of Strategy and Business Development, Rosa Permata Sari, stated that this collaboration follows the Memorandum of Understanding signed during the G20 Summit in Bali in 2022. “This partnership is a testament to PGN's commitment to expanding the use of environmentally friendly energy by optimizing Indonesia’s natural resources. It also serves as an example of sustainable renewable energy utilization. Our collaboration with Gagas and KIS for retail Bio-CNG aims to support the government’s target of achieving Net Zero Emission by 2060,” Rosa said on January 11, 2024.

Future Opportunities for Bio-CNG in Indonesia

PGN envisions Bio-CNG as a viable option to supplement natural gas supplies in Sumatra, Kalimantan, and nearby regions. With characteristics similar to PGN's distributed natural gas, Bio-CNG allows for flexible swapping mechanisms between the two commodities while utilizing PGN's existing infrastructure.

This innovative project highlights Bio-CNG’s potential as a renewable energy source that can reduce dependence on fossil fuels and support environmental sustainability.

The partnership between Gagas and KIS was formalized in late 2023 and reaffirmed during a meeting on January 10, 2024, attended by representatives from PGN, KIS, and Gagas at PGN’s headquarters in Jakarta.

Transforming Palm Oil Waste into Energy

Under the collaboration framework, KIS will process palm oil mill effluent into biomethane, which will then be compressed into Bio-CNG by Gagas for distribution to commercial and industrial customers.

K.R. Raghunath, Director of KIS, emphasized the project’s dual benefits: reducing greenhouse gas emissions and strengthening Indonesia's biomethane industry. “This initiative addresses emission challenges and aligns with Indonesia’s commitment to achieving Net Zero Emission targets,” he said.

Gagas CEO Muhammad Hardiansyah reiterated the company’s role as a provider of environmentally friendly energy through its Beyond Pipeline approach. “By sourcing energy from a more sustainable resource—processed palm oil waste—we can distribute Bio-CNG, starting with the Pekanbaru, Riau region. If successful, this model will be replicated in other regions, including Bangka Belitung, Sumatra, and Kalimantan,” Hardiansyah explained.

Expanding Renewable Energy for Long-Term Impact

Rosa expressed optimism that the initiative would deliver significant benefits not only to the companies involved but also to the broader community. Bio-CNG offers a long-term, sustainable energy solution that is both transportable and commercially viable for retail markets, potentially unlocking new economic opportunities in underserved areas without natural gas pipeline infrastructure.

“This initiative aims to create a meaningful impact on national economic development by providing a multiplier effect for society,” Rosa concluded.

Kembali Ke Beranda