Indonesia says gas export reduction to Singapore complies with contract limits
Indonesia reduced daily gas shipments to Singapore by about 8%, staying within contractual minimums, while both governments said they will honor existing agreements.
Indonesia began cutting daily gas exports to Singapore on Saturday, diverting 31 million standard cubic feet of gas – 15 million from Natuna and 16 million from Sumatra – to meet higher domestic electricity demand. Coordinating Minister for Downstreaming and Energy Transition Bahlul Lahadalia said the reduction represents roughly an 8 percent cut, which remains above the 10 percent threshold that would breach contracts, and therefore stays within the minimum contractual range of about 91-92 percent of exports.
"We have only reduced it by about 8 per cent. We would only be in breach of contract if we were to cut by 10 per cent," Bahlul said at a press conference.
He added that the cuts were driven partly by maintenance needs and rising domestic demand, and noted that the figure does not include Indonesia’s liquefied natural gas (LNG) supplies. Singapore Prime Minister Lawrence Wong responded that commercial gas contracts must be honoured and that Singapore is preparing for supply risks by expanding LNG import capacity and exploring nuclear energy options.
"The gas supplies are covered by commercial contracts. We expect all parties to honour their commitments, and Singapore’s gas importer will take the necessary steps to protect its rights and interests under these contracts," Wong said.
Singapore’s Energy Market Authority estimated the reduction to be less than 2 percent of the city-state’s total daily gas demand, and Energy, Trade and Industry Minister Tan See Leng said short-term electricity prices are unlikely to be affected, noting that much of Singapore’s gas pricing is linked to global indices.
Indonesia’s regulator SKK Migas confirmed that Natuna gas is being redirected to PLN Batam via the WNTS–Pulau Pemping–Batam pipeline, while Sumatra gas is flowing through the TGI pipeline to supply Batam, Bintan and Sumatra. Bahlul also said Indonesia is studying the construction of a nuclear power plant at possible sites such as Batam, the Riau Islands, Halmahera or Kalimantan to bolster energy security amid global supply constraints.