Go green 2 nd Annual CNG/NGV Asia Pacific Forum 2 nd Annual CNG/NGV Asia Pacific Forum The...

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2nd Annual CNG/NGV Asia Pacific Forum

2nd Annual

CNG/NGV Asia Pacific Forum

The re-emerging of Indonesia’s

CNG/NGV industry

Presented by:

Robbi R Sukardi APCNGI member and PT. Petross Gas director

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CONTENTS :

1. The Past Story of Indonesia’s CNG-NGV

industry

2. Current Developments

3. DKI Provincial Government Busway CNG Pilot

Project

4. The Confronted Challenges and Success

Factors for Indonesia’s Successful CNG/NGV

industry future developments

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The Past Story of Indonesia’s CNG-NGV industry

(1986 – 2005 )

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WHAT HAPPEN ?

Slow development, in fact, can be said that not much had happen over the past 2 (two) decades for Indonesia’s NGV industry.

Year MAJOR FACTS OCCURRENCE IN THE NGV INDUSTRY

1986 -1987

The Indonesia’s Government started the Energy Diversification and Conservation Program with promoting CNG as an alternative fuel and to endorse the Blue Sky Program

1987-1989 CNG as an alternative fuel for the transportation sector started to be commercialized by Indonesia’s state owned government company, Pertamina.

PERTAMINA, under the Indonesia's Government Regulation (UU no. 8/1971), is the state own company obligated to provide and distribute the supply of the national oil and gas consumption.

During the first start of this pilot project, about 300 taxi were converted to NGV.

1990 - 1998

Under the Ministry of Transportation decree no. 84 year 1993 elaborates on the use of CNG for public transportation particularly for taxis within the DKI Jakarta areas.

During this early stage, market growth and acceptance of NGV for CNG as an alternative fuel was slow due to the minimum deviation between CNG fuel price and the subsidized petrol fuel price.

CNG sale only represent less than 1% from the total consumption of oil fuel during this period.

Due to low volume of sales, many of the CNG station experience financial problems and even some had to close out their CNG pump station.

1998 On 18 May 1998, under the President Director of Pertamina decree letter No. 038/C0000/98-S3 set their new CNG retail price at Rp. 450/ple (petrol litre equivalent)

20002001

Number of NGV had reach its highest number recorded with 6,600 vehicles nationwide in year 2000.

Number of NGV dropped to estimated 4,700 vehicles in 2001 partly due to the high cost of the converter kits parts as well as the limiited number of CNG stations remain operational.

The number of CNG Station remain maximum operational in Jakarta was less than 10 stations.

The deregulation of the Oil & Gas industry with the new UU Migas 2001 was established.

20022004

22 November 2004, Pertamina set the new CNG sale price at their pump station at Rp. 1,550 /ple

The number of NGV dropped to the lowest to a low 600 vehicles in 2006.

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source data : angva

NUMBER NGV IN ASIA YEAR 2002

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Current Developments

( 2005 – Today )

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The Indonesia’s Government responded to this situation through endorsing alternative energy like bio-fuel and also

increase CNG fuel for the transportation sector

The domestic oil production had shown a decline over the years (est. 1 million barrel

per day)

Indonesia barely becoming a net oil importer country rather than an oil exporter

country (national consumption at estimated 1,1 million barrel per day)

Continuous increase in the number of vehicles (on average 7% - 8% yearly);

The Indonesia’s Government reduced the subsidize budget for the nation’s petrol fuel

(2005);

Increase of pollutant level from vehicle emission particularly in DKI Jakarta (third

most pollutant city in world);

World’s oil price had shown increase and by mid year of 2008 the world’s oil price

reached its highest point ever;

YEAR 2004 – YEAR 2005

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YEAR 2005 – Government Policy & Regulation Events affecting the CNG Industry

Republic Indonesia’s Presidential Instruction (In. Pres.) Decree no. 10 year 2005

regarding national energy conservation and saving enactment.

Indonesia’s Ministry Mines & Energy Policy (Kep. Men.) no. 0031 Year 2005 regarding

the implementation procedural in national energy saving, in which in point 5 clause 2

of the decree specifically states on the endorsing CNG for the public

transportation sector.

DKI Provincial Governor Instruction (Kep. Gub.) decree no. 77 year 2005 pertaining to

the energy saving program in the DKI Jakarta Provincial area.

DKI Provincial Government (Per.Da) decree no. 2 year 2005 regarding the monitoring

of air pollution in which article 20 mandates on the use of CNG on all public

transportation and Government use transportation.

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The upstream gas producer increased natural gas price from previously average

at $2.2/MMBTU to around $5.00/MMBTU.

High cost of maintenance and limited NGV vehicles (estimated less than 1.000 units

in Jakarta remain operational) had cause many of the existing CNG station to

incurred significant operational loss.

In June, subsidy for the nation’s petrol fuel was reduced significantly causing more

than 100% increase in premium fuel and diesel fuel sale price in the market.

DKI provincial government mandate that all new buses for the plan’s 15 corridors of

the Mass Rapid Transportation-Busway system to use dedicated gas engine fuel

system.

Pertamina announce to allocate next year budget to revitalized the existing

Pertamina’s station in DKI Jakarta area.

YEAR 2005 – Commercial Events affecting the CNG Industry

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Based on the Indonesia’s President (In. Pres.) decree no. 5 year 2006 and through

the Department of Mines & Energy, the National Energy Blue Print for 2005-2025

was established in which partly signifies government enforcement to use alternative

fuel other than petrol fuel for the nation’s fuel consumption. The DKI government mandates that all 3 (three) wheel Bajaj vehicles will be

replaced with the new environmental friendly CNG Bajaj.

YEAR 2006 – Government Policy & Regulation Events affecting the CNG Industry

YEAR 2006 – Commercial Events affecting the CNG Industry

On February 1st, Pertamina increased its CNG sale at all Pertamina’s pump station from

previously Rp. 1.550/ple to to Rp. 3.000 /ple, in which said considered as their

economical price. On March 2nd, the Department of Transportation launched a public relation program

to promote the usage of CNG fuel for transportation in Pertamina’s CNG Station in

Margonda, Depok. On May 20th Indonesia’s President, Mr. Susilo Bambang Yudoyono, open a ceremony to

promote and induce the use of NGV in Petross CNG fueling Station, which was DKI’s

first dedicated CNG station for the busway program. The Department of Transportation announced that they had allocated a budget to

provide up to 4,000 converter kits to be distributed for the public transportation. Pertamina’s director issued a directive letter no. 023/C00000/2006-S3 dated 31 July

2006 directing that the new sale price of CNG at Pertamina’s station to be Rp.

2.562/ple.

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20 MAY 2006

20 May 2006 – Jl. Perintis Kemerdekaan Petross & Transbatavia pool bus

Indonesia’s President, Mr. Susilo Bambang Yudoyono, open the “Initiation Ceremony to Promote and Support the use of CNG Fuel for Vehicles””Let us together, with full support from the Governor, to accelerate the

development of new CNG station infrastructure. This is needed to minimize the filling time then previously done before..... the government supports this CNG program and shall encourage natural gas price reduction, distribute free conversion kit, and reduction in electrical cost from PLN by ways of changing the tariff category for CNG pump station. In addition, we shall push for lower import tariffs and taxes for CNG applications, and reduction in toll fee of natural gas from PGN.” (Presidential

speach script)

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DKI Provincial Government Decree no. 141 year 2007 regarding the mandate to use CNG for all public transportation and DKI’s Provincial Government vehicles.

Year 2007 to Present – Government Policy & Regulation Events affecting the CNG Industry

Year 2007 to Present – Commercial Events affecting the CNG Industry

In 2007, the Department of Transportation conducted the first batch of Converter Kit

tender to distribute and installed 1,755 units of converter kits for taxi’s within the

DKI Jakarta area.

On February 21st, the re-launching program of NGV usage was held by the

Department of Transportation and opened by the Vice President, Mr. Yusuf Kalla.

In 2008 and 2009, the Department of Transportation continue to promote CNG as an

alternate fuel with distributing the another 1,200 units of converter kits for taxi’s in

DKI Jakarta area, and plan an additional 1,000 units for small public transportation

vehicles (Angkots) for the city of Bogor and another 500 for the city of Palembang.

The Mass Rapid Transportation Busway System in Jakarta now has around 329 CNG

busses supporting the 7 operational corridors.

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13

Country # of NGV # of Stations Dated

1 Pakistan 2,000,000 2,700 Dec 082 IR of Iran 1,215,593 764 Feb ‘093 India 821,872 402 Apr ‘084 China 400,000 1,260 July ‘085 Bangladesh 180,000 296 Nov ‘086 Thailand 141,335 310 Mar 097 Uzbekistan 47,000 43 Dec ‘078 Malaysia 42,000 120 Apr ‘099 Japan 36,345 327 Dec ‘08

10 Myanmar 25,802 44 Apr 0911 Republic of Korea 17,123 121 June ‘0812 Tajikistan 10,600 53 Dec ‘0713 Kyrgyzstan 6,000 6 Dec ‘0714 Singapore 3,443 3 Jan ‘0915 Indonesia 3,079 9 Apr ‘0816 Australia 2,453 146 Mar ‘0717 UAE 305 2 Mar ‘0718 New Zealand 283 14 Mar ‘0719 Philippines 36 1 Feb ‘0620 Vietnam 2 1 Jan ‘09

Current NGV Markets in Asia Pacific

(Source: Asian NGV Communications & GVR magazines & Others) / PTT Presentation slides data report

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No VEHICLES TYPE Total Vehicles

NGV NON NGV %

I. Large Capacity Buses

1. Bus (Non-Busway) 4,540 - 4,540 0%

2. Busway (Cor. 1 – 8) 420 329 91 78%

II. Middle Size Buses 4,979 - 4,979 0%

III. Vehicles

1. Angkot 6,746 150

6,596 2%

2. KWK 6,238 - 6,238 0%

IV. Bemo (APB) 1,096 - 1,096 0%

V. Taxi 24,256 2,360 21,896 10%

VI. Bajaj 14,424 400 14,024 3%

VII. Others 23,827 - 23,827 0%

Jumlah 86,526 3,239 83,389 4%

YEAR END 2008 – DKI JAKARTA PUBLIC TRANSPORTATION

(Source: DKI Jakarta Department of Transportation 2009 data report)

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0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

2003 2004 2005 2006 2007 2008 2009

No.

of Veh

icle

s

Pakistan Iran India China BangladeshUzbekistan Thailand Japan Malaysia Republic of KoreaMyanmar Tajikistan Kyrgyztan Australia IndonesiaSingapore United Arab Emirates New Zealand Philippines TaiwanVietnam(Source: Asian NGV Communications & GVR magazines Aug ‘08 & Others) and adopted from PTT presentation slides

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Master PlanningMaster Planning

Pilot ProgrammePilot Programme

Regulatory EnactmentRegulatory Enactment

Public RelationsPublic Relations

CommercializationCommercialization

Market DevelopmentMarket Development

NGV Developed NGV Developed

Mature MarketMature Market

WHERE INDONESIA IN THE DEVELOPMENT STAGES

1986 -1987

1988 -1989

1990 - 1992

2005 -2007

1989 - 1992

2006-2007

2006 - current

2007 - ??

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DKI Provincial Government Busway CNG Pilot Project

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DKI’S JAKARTA TRANSPORTATION SECTOR CONDITION:

A continuous increase in the number of vehicle by 7-10% yearly. An estimated 6 million vehicles in DKI Jakarta, which 600.000 of the

vehicles (1,2 mil people) enters from the outside Jakarta daily. Around 669 of new car registration application are requested daily. New road developments is very low (around 1% annum) compare to new

vehicles. The daily mobilization of vehicles in Jakarta reached 4,95 mil (motorcycles

53%, private vehicles 30%, buses 7%, and trucks 10%). The ratio between Public Transportation and Private Vehicles is 98% to

2%. 85% of the usage of the road from vehicles are used by private vehicles.

Degradation and diminishing number of the public transportation. (Source: DKI Jakarta Department of Transportation Report)

Mass Rapid Transportation Busway System as Solution

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DKI JAKARTA ENVIRONMENTAL FACTS:

Considered as the Third World’s Most Polluted City in the World after

Mexico City and Bangkok (Badan Lingkungan Hidup Dunia/UNEP)

67% of the pollution in Jakarta was due to the emission from vehicles.

(UNEP)

A yearly estimated economic lost of Rp 12 trillion is lost due to high traffic

jam, production time, and fuel evaporation (Yayasan Pelangi, 2003)

Bus TransJakarta using an environmental friendly fuel :

Compressed Natural Gas Fuel

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OPERATOR CORRIDOR # OF BUSES CNG STATION FILLING

TRANSBATAVIA (TB) II 60 PETROSS PERINTIS KEMERDEKAAN

TRANSBATAVIA (TB) III 66PETROSS RAWA BUAYADAVALTI DAAN MOGOT

JAKARTA TRANS METROPOLITAN (JTM) IV 27PETROSS PERINTIS KEMERDEKAAN

PERTAMINA PEMUDA

JAKARTA MEGA TRANSPOLITAN (JMT) V 27 PPD DAAN MOGOT

JAKARTA TRANS METROPOLITAN (JTM) VI 31 PERTAMINA PEMUDA

JAKARTA MEGA TRANSPOLITAN (JMT) VII 52 DAVALTI DAAN MOGOT

LORENA EKA SARI (LRN) PRIMAJASA (PRJ)

VIII 66PETROSS PERINTIS KEMERDEKAAN

PERTAMINA PEMUDAPERTAMINA GANDARIA

TOTAL BUSES 329

CONSORTIUM IX N/A

CONSORTIUM X N/A

NUMBER OF TRANSJAKARTA CNG BUSES (2008)

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CNG STATION PETROSSRAWA BUAYA

CNG STATION PETROSSJL. PERINTIS

CNG STATION DAVALTIDAAN MOGOT

CNG STATION PERTAMINAJL. PASAR MINGGU

CNG STATION PERTAMINAJL. PEMUDA

CNG STATION AKSARAKMP. RAMBUTAN

CNG STATION AKSARAJL. HEK

CNG STATION PERTAMINAGANDARIA

CNG STATION PERTAMINAJL. PLUIT

COR. REMARKS

I. OPERATOR: JETDISTANCE: 12,9 KMBUS STOP: 20

II. OPERATOR: TBDISTANCE: 14.3 KMBUS STOP: 23

III. OPERATOR: TBDISTANCE: 14 KMBUS STOP: 14

IV. OPERATOR: JTMDISTANCE: 11.9 KMBUS STOP: 15

V. OPERATOR: JMTDISTANCE: 13.5 KMBUS STOP: 15

VI. OPERATOR: JTMDISTANCE: 13.3 KMBUS STOP: 19

VII. OPERATOR: JMTDISTANCE: 12.8 KMBUS STOP: 14

VIII. OPERATOR: LRN & PJSDISTANCE: 8 KMBUS STOP: 23 / CURRENT 17

CNG STATION T ENERGYPINANG RANTI

: Operational

: Non Operational

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NO DKI JAKARTA'S CNG STATIONS OWNER CAPACITY ACCESIBILITY REMARKS

1 Jl. Sumenep, Jakarta Pusat Pertamina < 1000

m3/hr Small Vehicles Semi-Operational

2 Jl. Pemuda, Jakarta Timur Pertamina > 1000

m3/hrLarge Vehicles &

Busway Operational

3Jl. Raya Gandaria, Jakarta

Timur Pertamina > 1000

m3/hr Small Vehicles Operational

4 Jl. Raya Bogor, Jakarta Timur Pertamina < 1000

m3/hr Small Vehicles Non Operational

5 Jl. Ahmad Yani, Jakarta Timur Swasta < 1000


6Jl. Boulevard Timur, Jakarta

Timur Pertamina < 1000


7 Jl. Pluit, Jakarta Utara Pertamina < 1000

m3/hr Small Vehicles Semi-Operational

8Jl. Danau Sunter, Jakarta

Utara Swasta < 1000


9 Jl. Kali Deres, Jakarta Barat Pertamina < 1000


10 Jl. Daan Mogot, Jakarta Barat Davalti> 1000


Busway Operational

11Jl. Warung Buncit, Jakarta

Selatan Pertamina < 1000


12JL.Pasar Minggu, Jakarta

Selatan Pertamina < 1000

m3/hr Small Vehicles Operational

13 Jl. TebetTimur, Jakarta Selatan Pertamina < 1000


14 Jl. Perintis Kemerdekaan Petross > 1000


Busway Operational

15 Rawa Buaya Petross > 1000


Busway Operational

16 Kampung Rambutan Aksara> 1000


BuswayAwaiting

Operational

17 Hek Kramat Jati Aksara> 1000


BuswayAwaiting

Operational

18 Tanah Merdeka Aksara> 1000


BuswayAwaiting

Operational

19 Pinang Ranti T Energy> 1000


BuswayAwaiting

Operational

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TRANSJAKARTA’s AVERAGE MINIMUM CNG CONSUMPTION

On average each bus consumed 1 ple of CNG for every 1.3 km – 1.5 km distance.

Estimated 50,000 – 60,000 ple consumed daily to support the busway’s operational.

Filling time is a constraint during the afternoon filling time as the buses usually filled at a certain similar given time so the buses can be in operational again during the busway’s peak hours (7.00 -10.00 and 16.00 – 19.00)

Filling space is also a concern as each busses is 6 meters long and enters the station numbering on average 5 buses per batches.

CORRIDORS KM UNIT BUS MIN. AVG. DAILY AVG.TRIP/DAY PLE/DAY PLE/MONTH

II 14.3 60 48 9 9,504 285,120

III 14.0 66 66 9 12,794 383,815

IV 11.9 27 29 11 5,816 174,468

V 13.5 27 39 9 7,290 218,700

VI 13.3 31 31 10 6,343 190,292

VII 12.8 52 38 11 8,231 246,942

VIII 8 66 30 10 3,692 110,769

PLE 53,670 1,610,107

MMSCF 1.92 57.50

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TRANSJAKARTA BUSWAY – DKI PAYMENT SCHEME

BUSWAY USERS

TICKETING SALE FROM BUSWAY (@Rp. 3,500.-)

SUBSIDY

PT. JET(KORIDOR I)

PT. TB(KORIDOR II & III)

PT. JTM(KORIDOR IV & VI)

PT. JMT(KORIDOR V & VII)

BUSWAY OPERATORS ARE PAID BY JAKARTA’S BLU TRANSJAKARTA BASED ON KILOMETER RATE ACHIEVED PER MONTH

BADAN LAYANAN UMUM (BLU)

TICKETS REVENUE

PT. LRN(KORIDOR VIII)

PT. PRJ(KORIDOR VIII)

Pertamina Diesel Fuel@ Rp. 4,300/ltr

Pertamina’s and Private CNG Stations@ Rp. 2,562/ple

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The Confronted Challenges and Success Factors for Indonesia’s CNG/NGV Industry Future

Developments

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SUCCES FACTORS

1. Availability of abundant natural gas

reserves

2. Infrastructure

3. Pricing Policy

4. Availability of funds

5. Market Awareness & Acceptance

6. Industry & Regulator Body Support

+

CHALLENGES

+ + +

+ + + +

+ +

+ + + +

+ +

What are Indonesia’s NGV Success Factor & Challenges?

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Availability of abundant natural gas reserves

Source: BP Migas and Indonesia Petroleum Report 2005-2006 and Department Mines & Energy Indonesia Energy Blue Print Report & 2009 Data Report

AVAILABLE

Indonesia has the largest supply of natural gas among its South East Asia neighbor countries

In 2006 gas production was recorded at 8,280 MMSCFD.

In 2007, gas production increase to 8,901 MMSCFD of which 37% for domestic and 63% for export.

In 2009 is estimated that over 10,000 MMSCFD will be produce.

Energy fuel Total Reserve

Proven2004

ProductionYear

Dimished

Oil

Coal

http://don85.files.wordpress.com/2007/05/natural-gas-production-in-indonesia.jpg

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Infrastructure Infrastructure

BLUEPRINT PENGELOLAAN ENERGI NASIONAL 2005 – 2025 Dept. ESDM

NOT ENOUGH & NOT WIDELY SPREAD

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PRICING POLICY

o Regulatory Basis: UU Migas 2001 vs Pertamina Pricing Policy?

The deregulation of the Oil & Gas industry in 2001 had open up Indonesia’s market to local & foreign enterprise to conduct business under the basis of market economics principles

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EXPLORATION & PRODUCTION

(NATURAL GAS PRODUCER)

ECONOMIC / PRICE FACTORS

Country’s natural gas availability

World’s oil & natural gas price

Market demand size

TRANSPORT & DISTRIBUTION

(PIPELINE OWNER)

Onshore vs. Offshore Economies of scale size of

the well Natural gas composition Capacity & size of refinery

facility Tender process priced obtain

COMPRESSION(STATION OWNER)

Economics of scale size transported

Distance to targeted area Difficultness to transport area Tender/Contract price obtain

NATURAL GAS AT WELL(INDONESIAN

GOVERNMENT)

Volume of pressure obtain Compression ability (fast vs.

slow fill) Location of the station Power supply availability Gas composition Supply gas purchase

CNG VALUE PROCESS LINE

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PRICING POLICY


The Deregulation of the Oil & Gas industry had open up Indonesia’s market to local & foreign enterprise to conduct business under the basis of market economics principles

o Natural gas base price and pipeline toll fee is monitored and semi-regulated by BPH Migas, but who regulate and monitor the CNG selling price at filling station?

The pricing policy is based on the Minister of Mines & Energy Decree (Keputusan Menteri ESDM), which in the decree pipeline pricing policy for the transportation sector has not yet been clearly stipulated and categorized.

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EXPLORATION & PRODUCTION

(NATURAL GAS PRODUCER)

ECONOMIC / PRICE FACTORS POLICY HOLDER

Country’s natural gas availability

World’s natural gas price Market demand size

TRANSPORT(PIPELINE OWNER)

Onshore vs. Off shore Economics of scale size of

the well Natural gas composition Capacity & size of refinery

facility Tender process priced obtain

COMPRESSION(STATION OWNER)

Economics of scale size transported

Distance to targeted area Difficultness to transport area Tender/contract price obtain

NATURAL GAS AT WELL(INDONESIAN

GOVERNMENT)

Volume of pressure obtain Compression ability (fast vs.

slow fill) Location of the station Power supply availability Gas composition Supply gas purchase

Parliament/Legislator Approval

Central Government (President)

Local Government

Department of Mines & Energy

BP Hulu (Upstream) Migas Company’s Shareholder &

BOD

Department of Mine & Energy BP Hilir (Downstream) Migas Company’s shareholder &

BOD

Company’s shareholder & BOD

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PRICING POLICY UNCLEAR


The Deregulation of the Oil & Gas industry had open up Indonesia’s market to local & foreign enterprise to conduct business under the basis of market economic structure

o Natural gas base price and pipeline toll fee is monitored and semi-regulated by BPH Migas, but who regulate and monitor the CNG selling pricing at filling station?

The pricing policy is based on the Minister of Mines & Energy Decree (Keputusan Menteri ESDM), in which pipeline pricing policy for the transportation sector has not yet been classified in a decree

o CNG selling price at filling station is at a set price for the Transjakarta’s busway, but how about CNG selling price for other vehicles vs CNG selling price in cities other than DKI Jakarta?

At what price should private enterprise sell CNG at their station for the transportation sector?

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1 MMBTU = 27

CNG SELLING PRICE STRUCTURE USD 1 = Rp. 10.000,-

RUPIAH / PLE US$ / MMBTU

I GAS PRODUCER & PIPELINE OWNER

Interfunction Charge 1,198.62 $3.24

Toll Fee (PGN/Gas Negara) 60.00 $0.16

Marketing Cost 20.00 $0.05

Overhead Cost 86.67 $0.23

Pertamina Margin 94.71 $0.26

(1) SUB TOTAL 1,460.00 $3.94

II CNG STATION OWNER

Maintainance Cost 200.00 $0.54

CNG Equipment Investment Fee 300.00 $0.81

CNG Station Margin 360.00 $0.97

Station Owner Fee 60.00 $0.16

Land Rent 60.00 $0.16

(2) SUB TOTAL 980.00 $2.65

CNG SELLING PRICE ( 1 + 2 ) 2,440.00 $6.59

CITY FUEL TAX FOR VEHICLE ( 5% ) 122.00 $0.33

CNG SELLING PRICE AT FILLING STATION 2,562.00 $6.92

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AVAILABILITY OF FUNDS WITH CONDITIONS Macro Economy & Political Stability:

• World’s financial crisis occurred in 2007-2008 had not affect much of the country’s economy.

• Past 2 years, the Indonesia’ federal reserve bank (Bank Indonesia) has continued to lower its treasury interest rate (SBI).

• Local banks are currently liquid.

• Rupiah currency has indicate stable and strong positioning this past weeks.

• Presidential election proceeded swiftly and safely with minor disruption

Industry and Market Demand condition

• CNG Filling Station and the NGV market still has a lot of potential growth market

No VEHICLES TYPE NON NGV MKT SHARE

%

20% SHARE

CNG/PLE DAY

CNG CONSUME DAILY

I. Large Capacity Buses

1. Bus (Non-Busway) 4.540 0%

908

200 181.600

2. Busway (Cor. 1 – 8) 91 78%

18 220 3.960

II. Middle Size Buses 5 0%

1 100 100

III. Vehicles

1. Angkot 6.596 2%

1.319

30 39.576

2. KWK 6.238 0%

1.248

30 37.428

IV. Bemo (APB) 1.096 0%

219

10 2.192

V. Taxi 21.896 10%

4.379

20 87.584

VI. Bajaj 14.024 3%

2.805

5 14.024

VII. Others 23.827 0%

4.765

10 47.654

total 78.313 4%

15.663

ple 414.118

mmscfd 15

8 Existing Stations + 4 New Stations have an estimated capacity compression of 17.400 ple / hourOr an estimated daily (18 hours) compression capacity of 313.000 ple / day or 11 MMSCFD

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AVAILABILITY OF FUNDS WITH CONDITIONS

Macro Economy & Political Stability Factor:

• World’s financial crisis occurred in 2007-2008 had not affect much of the country’s economy.

• Past 2 years, the Indonesia’ federal reserve bank (Bank Indonesia) has continued to lower its treasury interest rate (SBI).

• Local banks are currently liquid.

• Rupiah currency has indicate stable and strong positioning this past weeks.

• Presidential election proceeded swiftly and safely with minor disruption.

Industry and Market Demand Factor:

• CNG Filling Station and the NGV market still has a lot of potential growth market

• Government regulation to support and to promote the use of NGV exist.

• Gas supply from PGN is available.

o Return on Investment Factor:

EQUIPMENT INVESTMENT

LAND & CIVIL DEVELOPMENT

Volume Pressure Obtain compressing stages

Compression ability fast or slow fill / # of

dispenser

Availability of power supply gas or electric

driven

Gas composition with or without gas dryer Location Owned or Rent

Land Size large vehicles or small vehicles

Certification Approval - Migas or Depnaker

Local Government Approval CERTIFICATION & APPROVAL

GAS SUPPLY PGN or Pertamina or other

Contract terms Rupiah or USD base

OPEATIONAL COST

PROFIT MARGIN

Power supply electric or gas bill

Cost of money high or low leverage

Return on Investment IRR and Payback period

Taxes

ROI factors to be considered …

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MARKET AWARESS & ACCEPTANCE

Indonesian society are becoming more concern for a cleaner and friendly environment as well are more aware of global warming threat whereby petrol fuel emission contributes the most pollutant for the city air.

• Bike to Work Group.

• Closing of Jakarta’s city main road during every weekend morning.

LOW ACCEPTANCE

In terms of their choices of fuel, majority will choose cheapest price and practical.

• Vehicle owner will be willing to fill CNG fuel but are hesitant to buy the converter kits.

• Not only vehicle owner will be willing to convert their vehicles if converter kits are cheap or free but also if it is practical to fill CNG fuel in every 5 km radius.

However,

Although,

Most of people in Jakarta understood CNG only as the fuel for the Transjakarta-Busway and some taxi’s owner.

In other cities outside Jakarta in fact do not realize CNG can be an alternative fuel for vehicles and that mostly understood natural gas are pipeline gas for industrial usage and misunderstood between CNG and LPG are different commodities.

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INDUSTRY & REGULATORY BODY SUPPORT GROWING SUPPORT

The NGV industry is gaining a lot of support from DKI Provincial Government commitment in using CNG as their choice of fuel for its Transjakarta’s busses.

The NGV industry is receiving real action implementation from the Department of Transportation through the distribution of converter kits for public transportation in cities like Jakarta, Surabaya, Bogor, Palembang, and other cities to come.

Provincial governments and county governments regulatory support on CNG.

NGV groups like ANGVA and APCNGI establishment and presence have and will continue strengthen the NGV market growth in Indonesia also increase public awareness on new CNG technologies and CNG safety issues.

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As an Conclusion, if Indonesia shall able to manage the :

SUCCES FACTORS

1. Availability of abundant natural gas

reserves

2. Infrastructure

3. Pricing Policy

4. Availability of funds

5. Market Awareness & Acceptance

6. Industry & Regulator Body Support

A PRICING POLICY STRUCTURE THAT WILL BENEFIT ALL STAKEHOLDERS

INCREASE MARKET AWARENESS THROUGH INTENSIVE PUBIC RELATION & MEDIA PROGRAM

then …

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Master PlanningMaster Planning

Pilot ProgrammePilot Programme

Regulatory EnactmentRegulatory Enactment

Public RelationsPublic Relations

CommercializationCommercialization

Market DevelopmentMarket Development

NGV Developed NGV Developed

Mature MarketMature Market

Then Indonesia’s NGV market will succesfully re-emerge and go forward to the next stage of development

1986 -1987

1988 -1989

1990 - 1992

2005 -2007

1989 - 1992

2006-2007

2006 - current

2007 - ??

go green


THANK YOUPT. PETROSS GAS

(subsidiary of PETROSS Group) Gedung ProMotor 3B Floor. Jl. Teuku Nyak Arif No. 14 Simpruk Jakarta 1222

Telp: +62-21-726-0630 ; Fax : +62-21-726-0448

Go green 2 nd Annual CNG/NGV Asia Pacific Forum 2 nd Annual CNG/NGV Asia Pacific Forum The...

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