Publications

Domestic demand for natural gas in Indonesia has been dramatically increasing, especially for power generation and industrial sectors in the past 5 years. In gas business, transportation plays an important role in the economics of its utilization. Pipeline network has been a traditional way in Indonesia to carry and distribute gas from sources to the customers. However in recent years, gas transportation through compressed natural gas (CNG) is developing, making competition with pipeline mode. In land, distribution pipeline and CNG transport become economic issue, considering size of investment, operation and maintenance (O&M) cost, and distance. In addition to that, externalities, either positive or negative, should come into consideration of public policy (government) in selection of the transportation mode. This paper presents a cost and benefit analysis for CNG transportation, as compared to pipeline mode. A case study using field data is presented. The results show that even pipeline is much less costly, CNG trucking has unique benefit in the opening of gas market in the new areas.Keyword: gas pipeline, CNG, cost benefit analysis