Jokowi Urges Lower Gas Prices in 3 Months; Luhut Says Possible

TEMPO.CO, Jakarta - Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan expressed optimism that the gas prices could be lowered within three months as requested by President Joko “Jokowi” Widodo. At present, the price is allegedly high since it is already pricey in the upstream.

“What is not possible?” said Luhut at his office, Jakarta, Monday, January 6.

Luhut explained the President demanded price reduction within the next three months or by March 2020. Thus he challenged his staffers to deal with the issue in early March. However, he said the government would not provide a subsidy to drop the price.

The government was currently studying the settlement of the gas fare. “We have actually exercised [the price] when I served as the acting minister of energy and mineral resources, but it was hampered because of unclear contract prices in the upstream,” Luhut claimed.

Meanwhile, Deputy Minister of State-Owned Enterprises (SOE) Budi Gunadi Sadikin elaborated about the high price of gas that was difficult to cut given quite pricey raw materials in the upstream.

"So even though it [the gas] has not yet arrived at PGN (state-owned gas firm), the price is already above US$ 5 per Million British Thermal Unit (MMBtu), or in the range of US$ 5-7 per MMBtu," he said.

Therefore, Budi opined the issue to deal is about how to obtain cheap gas resources as he hoped that the government subsidy would not be necessary to reduce the price.

President Jokowi earlier on Monday, January 6, gathered his state-ministers in a meeting at the Presidential Office. During the discussion, he lamented the high gas prices despite the topic was often discussed in central government meetings.

CAESAR AKBAR | AHMAD FAIZ