Wednesday, 17 July 2019 | 18:26 WIB

PGN Allots $500 Million for 2017 Capex

PGN Allots $500 Million for 2017 Capex (illustration: pgn)

JAKARTA, NETRALNEWS.COM - State-owned oil and gas company Perusahaan Gas Negara (PGAS.JK), also known as PGN, has set aside US $500 million or around IDR6.5 trillion(PGN) for its 2017 capital expenditure (capex).

Nusantara Suyono, Director of Finance at PGN, said the company’s capex spending up to the first half of 2017 only reached about $130 million, or at around 26 percent of its total capex.

The use of capex funds that have not been maximized is due to the lack of absorption in the company’s downstream business, especially for Engineering, Procurement and Construction (EPC) works, such as the construction of gas pipelines.

PGN’s capex of $500 million is divided into two parts, namely 55 percent for upstream business, which is handled by its subsidiary Saka Energi Indonesia (SEI), while the rest for downstream business is handled by the company.

"Capex spending in the upstream segment has reached $100 million, and about $20 million to $30 million in the downstream segment,” Suyono said.

In the first quarter of 2017, PGN’s gas distribution reached 816 MMSCFD, a rise of19 MMSCFD from the same period in 2016. In that period, sales volume increased in line with the increase of gas usage in the electricity sector. The number of distribution subscribers increased from 111,076 customers  to 168,973 customers

Suyono added that PGN’s subsidiary, Saka Energi Indonesia (SEI), has invested in 10 oil and gas blocks in Indonesia and one oil and gas block in Texas, United States. Currently, SEI is also in the process of submitting a plan to develop Sidayu well at Pangkah block.