For specific industries, such as the fertilizer, petrochemical, and steel industries, gas price is very significant for industry competitiveness, considering that 70% of production costs are for gas as raw material. Therefore, it is not surprising that the industry demands lower prices in order to reduce production costs. This is different from other industries such as pulp and paper, ceramics, glass, food and beverage, oleochemicals, rubber, textiles, and socks, which use gas as fuel in industries with gas costs below 20% production costs.

Secretary-General of the Indonesian Fertilizer Producers Association (APPI) Dadang Heru Kodri in the FGD 24/3 said that gas in the fertilizer industry plays a role as raw material/process gas by 80%, and as fuel for 20%. The gas price of 6 USD / MMBTU for urea fertilizer in Indonesia is higher than in Malaysia (USD 4 / MMBTU) and the Middle East (less than USD 3 / MMBTU). This high gas price causes the cost of producing fertilizer to be high, compared to the world average urea production costs.

Dadang added that the high production cost had triggered an increase in domestic urea imports and a high stock of Indonesian urea fertilizer. With the high urea imports, it is feared that other countries will depend on other countries and threaten Indonesia’s food sovereignty.

As for the ceramic industry, although gas is not the primary raw material for ceramics, gas plays a vital role as fuel where the gas price structure to production costs ranges from 25% -40%. Chairman of the Association of Various Ceramic Industries, Elisa Sinaga, said that the ceramic industry’s current condition is difficult. With a utility of only 60%, this is due to falling domestic demand due to sluggish economic conditions, so ceramic imports have increased from China and Vietnam. According to him, this low utility increases production costs. This is getting tougher coupled with the high price of gas compared to other countries.

According to Elisa, the current gas price for the ceramic industry is no longer competitive. The ideal gas price economically is 5-6 USD / MMBTU. However, for the ceramic industry, if the government gives a price of USD 7 / MMBTU, which is received at the plant gate, this is enough to boost competitiveness. “The government needs to fulfill its promise so that gas prices fall, in order to increase industrial growth,” she said.

Elisa also pointed out that gas prices vary between regions due to the network that is not yet integrated. For example, the gas price in East Java for consumers above 300,000 m3 / month is 8.01 USD / MMBTU. This price is the cheapest compared to the gas price in West Java, which is 9.14 USD / MMBTU, and the gas price in North Sumatra is 12.28 USD / MMBTU.