JAKARTA, Nov. 13 (Xinhua) -- Indonesia plans to build a Liquefied Petroleum Gas (LPG) plant with a production capacity of 1.5 to 2 million tons per year to strengthen domestic supply and reduce dependence on imports, according to Energy and Mineral Resources Minister Bahlil Lahadalia on Wednesday.
"The government encourages Pertamina (the state-owned energy company) and private sector players to compete in developing this LPG plant to bolster domestic supply," said Lahadalia during a hearing with the House of Representatives in Jakarta.
Indonesia's LPG consumption currently reaches 8 million tons per year, but domestic production can only meet around 1.9 million tons, leaving the remainder to be covered by imports. This reliance on imports costs the country an annual LPG subsidy of up to 83 trillion rupiah (5.2 billion U.S. dollars).
Despite the new LPG plant, Indonesia will still face a supply shortfall of around 4 million tons, as the natural gas available as raw material is limited to a potential 2 million tons per year.
The government is also planning to accelerate the development of gas network infrastructure across several regions to enhance domestic energy distribution. ■
