PGN Gas Subholding Pertamina and PIM Developed Gas-Based Business to Support Carbon Emission Reduction

Aceh, March 3, 2022 - PT PGN Tbk, a Pertamina Gas Subholding, synergizes with PT Pupuk Iskandar Muda (PIM) related to the downstream development of environmentally friendly natural gas, blue ammonia. Therefore, a Memorandum of Understanding was signed by Heru Setiawan, Director of Strategy and Business Development of PGN, and Budi Santoso Syarif, President Director of PIM, last Thursday (24/02/2022).

"We are ready to collaborate with PIM to conduct a joint study in the context of downstream natural gas and the development of an environmentally friendly gas-based (C1) related to the Blue Ammonia business," said Heru Setiawan (02/03).

Blue ammonia is processed through the Carbon Capture Storage (CCS) stage during the production of H2, making it more environmentally friendly, easy to transport, and can be used for power fuel or transportation sector. This is aligned with Indonesia's target of reducing carbon emissions by up to 29% and towards net zero emissions by 2060.

"Pertamina Group with PIM, SOE, and other business partners are developing an integrated business plan covering all existing business potentials to realize cooperation through the use of energy with lower emission levels. It is aligned with one of the priority issues of 3 main G20 Summit issues, including the role of natural gas in the energy transition," Heru added.

Budi Santoso Syarif, President Director of PT Pupuk Iskandar Muda said, one of PIM's plans is to develop Blue Ammonia on the IMIA land, which will cooperate with PGN as a provider of natural gas and gas infrastructure for the new Ammonia Plant. With PIM's long experience in operating fertilizer factories, they will provide land and utilities for the plant operation and the Blue Ammonia plant.

Carbon dioxide (CO2) in the ammonia plant will be captured and further treated in the form of CCS (Carbon Capture Storage) or CCUS (Carbon Capture Utilization Unit) so that the ammonia will become Blue Ammonia.

“The CO2 produced will be injected into oil and gas wells to increase the tonnage of oil recovery. By storing CO2 underground, it enables for increasing oil and gas production. It has the potential to increase PGN and PIM profits," Budi said.**

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