PGN Converts Coal into Gas, with a Potential of 9.7 Trillion Cubic Feet
PT Perusahaan Gas Negara (PGN) is pursuing coalbed methane development in Tanjung Enim, South Sumatra, to diversify domestic gas supplies for industry and power generation. The area is estimated to contain 9.7 trillion cubic feet of coalbed methane in place, with an estimated economic value of US$15.4 billion. PGN plans to increase gas deliveries in stages from 1 million to 25 million standard cubic feet per day and is developing infrastructure to connect new gas sources to the existing transmission network.
GAS INDUSTRY NEWS
CNBC Indonesia-Firda Dwi Muliawati
PT Perusahaan Gas Negara (PGN) has begun developing coalbed methane (CBM) as a potential new source of gas in Tanjung Enim, South Sumatra. According to Indonesia’s Directorate General of Oil and Gas, the area contains an estimated 9.7 trillion cubic feet of original gas in place, with an estimated economic value of US$15.4 billion.
The project could help PGN bring an underused domestic gas resource to market and diversify supplies for industrial customers and power plants. The company has prepared technical and commercial plans for the project and aims to increase deliveries in stages from 1 million to 25 million standard cubic feet per day.
PGN President Director Arief K. Risdianto said the company is also exploring supplies of biomethane produced from palm oil waste and synthetic natural gas (SNG). PGN is developing a gas injection point to collect supplies from several sources and feed them into existing transmission pipelines. The company plans to use both pipeline and non-pipeline infrastructure to bring these supplies into its network.
The project has received government support. On July 3, 2026, Presidential Chief of Staff Dudung Abdurachman visited the gas receiving and compressor stations in Pagardewa. The visit was part of the Presidential Staff Office’s oversight of national priorities to strengthen energy security, expand domestic production capacity, and reduce reliance on energy imports.
Dudung said developing coalbed methane in Muara Enim was a strategic priority, with several administrative steps still pending, including an adjustment to the detailed spatial plan. The Presidential Staff Office urged the agencies involved to resolve these issues so the project could move toward commercial development in line with applicable procedures.
Arief welcomed the office’s support in addressing obstacles to gas infrastructure development in Pagardewa and the surrounding area. He said PGN’s work in Muara Enim and Pagardewa aims to provide a reliable domestic energy supply while supporting local communities and the regional economy.
PT Perusahaan Gas Negara (PGN) has begun developing coalbed methane (CBM) as a potential new source of gas in Tanjung Enim, South Sumatra. According to Indonesia’s Directorate General of Oil and Gas, the area contains an estimated 9.7 trillion cubic feet of original gas in place, with an estimated economic value of US$15.4 billion.
The project could help PGN bring an underused domestic gas resource to market and diversify supplies for industrial customers and power plants. The company has prepared technical and commercial plans for the project and aims to increase deliveries in stages from 1 million to 25 million standard cubic feet per day.
PGN President Director Arief K. Risdianto said the company is also exploring supplies of biomethane produced from palm oil waste and synthetic natural gas (SNG). PGN is developing a gas injection point to collect supplies from several sources and feed them into existing transmission pipelines. The company plans to use both pipeline and non-pipeline infrastructure to bring these supplies into its network.
The project has received government support. On July 3, 2026, Presidential Chief of Staff Dudung Abdurachman visited the gas receiving and compressor stations in Pagardewa. The visit was part of the Presidential Staff Office’s oversight of national priorities to strengthen energy security, expand domestic production capacity, and reduce reliance on energy imports.
Dudung said developing coalbed methane in Muara Enim was a strategic priority, with several administrative steps still pending, including an adjustment to the detailed spatial plan. The Presidential Staff Office urged the agencies involved to resolve these issues so the project could move toward commercial development in line with applicable procedures.
Arief welcomed the office’s support in addressing obstacles to gas infrastructure development in Pagardewa and the surrounding area. He said PGN’s work in Muara Enim and Pagardewa aims to provide a reliable domestic energy supply while supporting local communities and the regional economy.
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