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East Java to Experience Shortage of Gas
Ririn Radiawati Kusuma | November 26, 2011

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Perusahaan Gas Negara, the state-controlled gas distributor, said that industries and households in Surabaya and surrounding cities in East Java will experience a lack of gas next month because of maintenance that will force production to halt.

The offshore Maleo blocks, which supply gas to East Java, will have 14 days of production stoppage due to routine maintenance, Nella Andaryati, a spokeswoman for PGN, said in Jakarta on Friday.

The gas blocks are operated by Santos Oil of Australia. PGN distributes the gas from the Maleo blocks to companies and households in East Java.

In the Dec. 3-5 period, production will be halted, Nella said. On Dec. 6-8, production will be at less than full capacity, before production again is halted from Dec. 9-19, she said.

The Maleo field produces an average of 110 million standard cubic feet per day (mmscfd) of gas. That would be equivalent to about 45 percent of the total gas demand of 250 mmscfd in Surabaya, the second-largest city in Indonesia after Jakarta, and surrounding areas.

Gas is supplied as fuel for power generators in the area, and companies use it in their manufacturing process.

Most industries in Surabaya and its vicinity are expected to halt their production, Nella said.

PGN has received compensation for the loss in production, the spokeswoman added, without elaborating.

Surabaya is home to shoe manufacturers, and to other companies such as the Maspion Group, which makes kitchenware.

The headquarters of Semen Gresik, the country’s biggest cement maker, is located on the outskirts of Surabaya.

Shares of PGN fell 0.9 percent to Rp 2,900 on the Indonesia Stock Exchange on Friday.

Shares in the gas distributing giant have fallen 35 percent so far this year.