Mini LNG Strategy in East Indonesia to Support 12 BSCFD National Gas Production Target, A Comparative Study With Solar and Batteries

Abstract

The Indonesian government has set the target for national gas production to 12 BSCFD by 2030. Mini liquified natural gas (LNG) could be the solution by liquifying the natural gas produced in East Indonesia that is likely to have future potential reserve from new exploration and production. The distribution of natural gas from East Indonesia by pipeline infrastructure is constrained by the complex geographical condition and insufficient infrastructure. The objective of this paper is to highlight a concept of mini-LNG strategy to overcome the distribution barrier of gas in East Indonesia to increase natural gas utilization in Indonesia and compare such concept with solar and battery as energy alternatives. As a methodology, a techno-economic analysis is used to compare gas liquefaction plants and LNG storage built near the gas source with solar and battery. Typically, LNG terminals for regasification and pipelines for distribution are installed near the consumer area. The natural gas from the source is liquified and transported to the consumer area in the form of liquified gas by LNG ships, then the regasified gas is distributed to the end-consumer via pipelines. As for baseline scenario, natural gas source in East Indonesia is predicted to have 145.5 TCF of natural gas. A study has projected Indonesia’s LNG consumption to be more than 700 MMSCFD from 2020 to 2029 in comparison with solar and battery. The development of mini-LNG maybe the alternative energy source for remote areas that have no installed electricity and use generators, which could save US$5.4 million by replacing the diesel feedstock for the generators. Mini LNG plants development on a large scale could support the government’s plan to produce 12 BSCFD of natural gas by 2030.