JERA allies with Indonesian operator for LNG value chain development

Japan’s energy giant JERA and PT PLN Energi Primer Indonesia (PLN EPI), a fuel procurement and transportation operator for Indonesia’s power giant PT PLN (Persero), have signed a memorandum of understanding (MoU) to collaborate on the development of an LNG value chain.

The MoU provides for collaboration in LNG procurement, optimization and the development and operation of LNG receiving terminals in anticipation of growing demand for LNG in Indonesia, JERA said, noting that the two parties will establish an LNG value chain for the power segment in Indonesia and will also study the possibility of converting to a hydrogen and ammonia value chain.

“Collaboration to establish a value chain for LNG, which plays an important role as an energy transition fuel, is expected to help Indonesia achieve both a stable supply of electricity and energy transition, as well as to contribute to achieving net zero emissions by 2060,” JERA stated.

To remind, this MoU follows JERA’s agreement with Indonesia’s state-owned oil and natural gas company Pertamina on business opportunities for infrastructure investment in low-carbon fuels, such as LNG and hydrogen/ammonia.

The collaboration will include LNG and hydrogen/ammonia transportation and LNG receiving terminal operation and maintenance, as well as capacity building through benchmarking, training, and/or exchange to improve the operational efficiency of LNG handling. In addition, the parties will also consider the development of new businesses related to carbon capture utilization and storage (CCUS).

At the time, Steven Winn, Senior Managing Executive Officer and Chief of Global Strategist of JERA, said: “We understand that gas and LNG are key to the process of decarbonization in Indonesia. The decarbonization roadmap is not a one-size-fits-all guideline but needs to be custom-tailored for each country. Therefore, we will provide our cutting-edge solution to the energy issues in Indonesia and strengthening their value chains for greener fuels.”