EFFECTIVE CNG HANDLING & LOGISTICS FOR INDUSTRIES

(AN INDONESIAN CASE STUDY)

Presented by
Robbi R. Sukardi, Secretary General
APCNGI Ho Chi Minh, Vietnam, 01 - 03
August 2012
Background behind the growth of CNG for
Industrial in Indonesia
 (1). INDONESIA’S CONDITION

Indonesian dependency on oil fuel , as we’re NO LONGER a
Nett Oil Exporter Country;

Huge potential gas reserve, with proven reserve of 94,78
TCFand potential reserve of 87.73 TCF, Indonesia is
considered as country with largest natural gas reserve;

Limited pipeline infrastructure;

LNG is NOT yet available for domestic use;

Government program to reduce emission level and increase
the monetization of stranded gas.

Industrial gas demand exceeds supply due to lack of pipeline
infrastructure.

Many stranded small scale gas reserves.
•
“CNG as another means of gas transportation
aside from conventional pipeline and LNG ”
 (2). VOLUME
With CNG bulk sale selling can reach your
economies of scale of the CNG Station.
SAMPLE PARAMETERS OF A CNG MOTHER
STATION
Large Size Category CNG Station Minimum Capital Expenditure
Capacity
Parameters
Compressors minimum 2,000m3/hr CNG Main Equipments $ 1,883,770
Capacity Compressors Pipeline Construction $ 154,000
maximum 4,000m3/hr Civil Construction Land Lease $ 550,000
-# of compresion stages 4stages 5 years $ 525,000
-Minimum Power Capacity Size 1MW Approvals & Certifications $ 90,000
of Land is below 3,000m2
6units . . Total Minimum Capex $ 3,202,770
Unit Nozzels Filling is minimum 2,000m3
Storage Tank Capacity at Site 2units Monthly Operational Expense
Gas Dryer Systems 200meters Maintenance Equipments $ 11,887
High Pressure Piping Lengths 19.0% Power Usage $ 15,429
VAT taxes, Import Tax 18hours Man Power & GA $ 8,000
Minimum Operational Time Total Minimum Monthly Opex $ 35,316

Capital Structure Cost of Fund & IRR Requirements

Requirements Large Size CNG $ 3,202,770 .
Cost of Debt 13%annual
Stations Capex Interest During $
. Maximum Debt Maturity 5.00 years
Construction $ 1,080,777 Corporate Tax Rate 20%
Working
Working CapitalCapital Gas
Operation $112,097
70,631 Cost of Equity Minimum IRR 26%annual
Total Funds Required $ 4,466,275 20%

Required Minimum Cash Received $ 117,733 / month

Debt 40% $ 1,786,510
Equity 60% $ 2,679,765 .

Total 100% $ 4,466,275

Operation Cost $ 35,316 Required Minimum Cash Received $
117,733 Monthly Minimum Cost Coverage $ 153,049
 COST STRUCTURE TO CLOSED OUT YOUR REQUIRED RETURN ON
INVESTMENT

Minimum Volume Sale per Day (m3) 36,000 Maximum Volume Sale per Day (m3) 72,000
Minimum Volume Sale per Month 1,080,000 Maximum Volume Sale per Month 2,160,000
(m3)
Minimum CNG Station Margin 0.07 / m3
Minimum CNG Station Margin $ 0.14
Cost of Pipeline Gas $ 0.25 Cost of Pipeline$ Gas $ 0.25 / m3
Cost of CNG at Station $ 0.39 Cost of CNG at Station $ 0.32 / m3
VAT 10% $ 0.04 VAT $
Net Price of CNG at CNG Station $ 0.43 0.03 / m3
Net Price of CNG at CNG Station $ 0.35 / m3
EQUIVALENT TO EQUIVALENT TO
MMBTU MMBTU
Minimum CNG Station Margin $ 3.80 Minimum CNG Station Margin $ 1.90 / mmbtu
Cost of Pipeline Gas $ Cost of Pipeline Gas $ 6.70 / mmbtu
6.70 Cost of CNG at Station $ 10.50 Cost of CNG at Station $ 8.60 / mmbtu
VAT 10% $ 1.05 VA $ 0.86 / mmbtu
Net Price of CNG at CNG Station $ NetT Price of CNG at CNG $ 9.46 / mmbtu
11.54 Station
 : Cost of Running Your
Stations

$0.50 Target
$0.45 Sale Price
at Mother
$0.40
Stations
$0.35

$0.30

$0.25

$0.20

$0.15

$0.10

$0.05

$-

Volume m3/month 1,080,0 1,200,0 1,320,0 1,440,0 1,560,0 1,680,0 1,800,0 1,920,0 2,040,0 2,160,0
00 00 00 00 00 00 00 00 00 00
Economical CNG Station $ $ $ $ $ $ $ $ $ $
Margin 0.14 0.13 0.12 0.11 0.10 0.09 0.09 0.08 0.08 0.07

Assumption Pipeline Gas $ $ $ $ $ $ $ $ $ $

0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25 0.25

Sale Price before VAT $ $ $ $ $ $ $ $ $ $

at Station 0.39 0.38 0.37 0.36 0.35 0.34 0.34 0.33 0.33 0.32

VAT 10% $ $ $ $ $ $ $ $ $ $
0.04 0.04 0.04 0.04 0.03 0.03 0.03 0.03 0.03 0.03

Sale Price of CNG at $ $ $ $ $ $ $ $ $ $

Station 0.43 0.42 0.40 0.39 0.38 0.38 0.37 0.36 0.36 0.35
 Metering
Well Head Gas Plant System

Gas Upstream
Infrastructure

NGV Customers
Gas Downstream Infrastructure

Gas Customers / Daughter Stations Gas Customers / Factories

(3). COMMERCIALLY MORE
PROFITABLE
The competitor in selling CNG to industries in
Indonesia are other fuel energy that are
more expensive.
THE PRICE DEVIATION BETWEEN GAS AND OTHER FUEL IN
INDONESIA
Heating Value Price
Fuel unit

Btu/unit kcal/unit US$/MMBTU

KEROSENE Liter 35,079 8,840 32.94

GASOLINE Liter 33,000 8,316 28.00

HSD Liter 35,964 9,063 23.06

MFO Liter 36,786 9,270 19.76

CNG
HFO Liter 38,754 9,766 21.41
Price

LPG Kg 44,524 11,220 21.97

NG Pipeline (PT. PGN price Jakarta) m3 36,798 8,919 8.90

NG Pipeline (PT. PGN price m3 37,257 9,031 9.10

Surabaya)

NG Pipeline (PT. PGN price Medan) m3 37,257 9,031 10.00

$ 5 - $ 6 / mmbtu + $ 3 - $ 4 / mmbtu + $ 2 - $ 4 / mmbtu + $ 2 - $ 4 / mmbtu = $ XX / mmbtu
Natural Gas Natural Gas CNG On-line CNG Trucking
Industrial
Supplier Pipeline Station Fleets

Gas Customers / Factories

KEY SUCCESS FACTORS FOR EFFECTIVE CNG
HANDLING & LOGISTICS FOR INDUSTRIES
IN INDONESIA
UNDERSTAND YOUR INDUSTRIAL CUSTOMER
NEEDS
 Gas energy consumption rate per month, days, and
hourly per cubic meters.
 The distance between the industrial customer to the
CNG Mother Station.
 The traffic and road condition to the industrial
customer from the CNG Mother Station.

“The CNG carrier and Pressure Reduction System must

be tailored made toward the Industrial need and
specific surrounding area to avoid miscalculation of
an over investment or a too highly operating cost”
 Kilometers distance and ease of traffic

Interval [ ? ] time

[ ? ] filling per
day

MOTHER STATION CNG CASCADE CYLINDER CNG CASCADE CYLINDER INDUSTRY CUSTOMERS
FILLING DOWNLOADING AT INDUSTRY

CAPEX: CAPEX: CAPEX:

•CNG Station •Storage Cylinder (type I, II, III, or IV) •Site Development
•Land •Truck Trailer (10 ft, 20 ft, or 40 ft Module truck carrier) •Regulators System\
•New Piping ( if needed )
OPEX : OPEX :
•Gas supply •Compressed Natural Gas Supply (if bought FOB)
•Workers •Transportation cost (travel distance for fuel and operating costs)
•Depreciation of the Station •Depreciation of your assets

CNG PROVIDER CUSTOMERS

 customer
Volume btu Sale per month : equivalento mmBtu
to : m3
or equivalento to : monthly
Distance from Station to Customers : M3
Minimum Number of GTM Skids daily
Required: km
Gas Required / Day MMBtu / Day
units

- Minimum per hour

- Maximum per hour
Gas PRODUCTION - NET MMBtu / Day

Hours Production m3 / hour

Conversion Factor m3/MMBtu

Gas PRODUCTION - NET m3

Compression Capacity at CNG Station m3/hour
GTM Type (Capacity m3) 10/20/40 ft
xxx
Number of GTM Required
Distance roundtrip units
km
Speed of HVD for delivery km/hour
“Designing and custom made, if necessary, toward
the customer gas requirement consumption and
road conditions….”
Typical Industrial Daughter Station
Equipment
 COMPRESSOR

METERING
PIPELINE DRYER
SYSTEM

BY PASS SYSTEM COMPRESSOR

STORAGE
DISPENSER DISPENSER DISPENSER
#1 #2 #3 CYLINDER

FILL POINT
#1
CAREFULL ON CONVERSION DEVIATION AND DISTRIBUTION
LOSSES

GAS PGN
TURBIN MICRO
EVC MOTION M3 PLE
MMBTU METER

COMPRESSOR

TURBIN
METER
Laporan Komposisi PGN

BULAN : RATA RATA

APRIL
KOMPOSI 2012 APRIL
SI GAS RATA RATA
C1 89.2493
C2 3.4380
C3 1.2903
N - C4 0.2884
I - C4 0.3293
N - C5 0.1451
I - C5 0.0881
N - C6 0.1807
N - C7 0.0067
N - C8 0.0034
N - C9 0.0008
N2 0.5381
CO2 4.4411
H2O 0.0006
H2S 0.0001
TOTAL 100.000
S.G 0.6467
GHV 1038.1113
Methane : CH4 89.2%

Base Temperature : C 27.0

: K 300.0 PJBG PGN &

PENGUJIAN
: F 80.6
Standard Temperature : C 15.6

: K 288.6 CNG Equipment

Standards

: F 60.0
1 BTU : Kkal 0.2520

Compressibility Factor : Z 0.99798 at PGN 27 C

1 SCF : Z 35.3147 M3
1 BTU / Scf : Kkal / 8.5596 at PGN 27 C
m3

Density of Gas Standard at Avg. Temperature

8.8990 Standard HEATING VALUE
Specific Gravity Nat Gas : SpGr 0.64675 PGN APRIL 2012 Btu/UNIT kCAL/UNIT
FUEL UNIT
Air Density at 0 C : Sm3 1.286
Specific Gravity Nat Gas : SpGr 0.67239 KEROSENE
standard Liter 35,079 8,840
GASOLINE Liter 33,000 8,316
Air Density at 27 C : Sm2 1.170 HSD Liter 35,964 9,063
Real Gross Heating Value : BTU/CF 1038.111 PGN APRIL 2012
MFO Liter 36,786 9,270
Air Pressure : Mpa 101,325 LPG Kg 44,524 11,220
Air Density at 30 C : Sm3 1.158
Avg. Temperature @ 1.0 : Celcius
MMBTU 27.00
8,885.8 CNG
kkal/m3 (Base) m3 36,607 9,224
Cust Air Density at X : kg/m3 1.16988 1 m3 is equal to Btu/Unit LSP 1.1093
1.0 : MMBTU 28.36 m3 (Base)
Air Density at 35 C
Celcius : Sm3 1.140
1 LSP is equal to Btu/Unit M3 0.9015
MASS FLOW METER KG TO M3 1.5462
Gas Density at 0 C : Kg/m3 0.75
66

Gas Density pada : Kg/m3 0.6467

suhu
CNG INDUSTRIES PROVIDERS IN
INDONESIA
AREA OF
OPERATIONS
INDUSTRIAL CNG MARKET
PLAYERS
•
PT. CITRA NUSANTARA GEMILANG PT. BERKAH MIRZA INSANI
3,5 mmscfd capacity Mother Station
•
•3,0 mmscfd capacity Mother Station
Supplied by PT. Pertamina
• •Supplied by PT. Perusahaan Gas Negara
•Gas contract amounted to 2,5 mmsfd and all
Gas contract amounted to 3,5 mmsfd and all already sold to industrial
•

customers. already sold to industrial customers.

•
PT. PETROSS GAS
1 mmscfd capacity Mother Station
•

Supplied by PT. Perusahaan Gas Negara

•

Gas contract amounted to 0,7 mmsfd and sold to the Bus Transjakarta
•

market.

PT. T ENERGY
•

•
1,5 mmscfd capacity Mother Station PT. CIPTA NIAGA GAS
•
Supplied by PT. Perusahaan Gas Negara •4,0 mmscfd capacity Mother Station
•
Gas contract amounted to 0,5 mmsfd and 0,5 sold to the Bus •Supplied by PT. Perusahaan Gas Negara
Transjakarta market & industrial •Gas contract amounted to 2,5 mmsfd and all
already sold to industrial customers.

•
PT. IEV
•
3,5 mmscfd capacity Mother Station
•
Supplied by PT. Odira Gas
•
Gas contract amounted to 3,5 mmsfd and all
already sold to industrial customers.
AREA OF
OPERATIONS
CHALLENGES IN CNG INDUSTRIAL
(a case of stranded gas)
CNG Mother Station is located
at desa Kalidawir, Sidoarjo,
East Java.

6” DIA FLOWLINE

TGA-2 WELL

TGA-1
WELL
TGA-5
WELL
KALIDAWIR
CNG MOTHER
STATION

TGA
GAS PLANT
 LAPINDO/INDOGAS TGA #5 WELL AVAILABILITY
TO SUPPLY 3,0 BBTU/DAY

LAPINDO gas contain energy : 1.011,9 btu/scfm

is equivalent to 1 ltr of 36,171 scfm
Solar : is equivalent to kkal 9.004,8 kkal/m3
level of : is equivalent to m3 1,024 m3
gas of :
THE SURROUNDING AREA OF THE NATURAL GAS RESERVE WELL
HEAD
 THANK
YOU
PT. RAJA RAFA SAMUDRA
Asosiasi Perusahaan CNG Indonesia
Jl. Pertani Raya No. 18 Kav. A
(APCNGI)
Duren Tiga, Pancoran .Jakarta Selatan
Secretariat Office Address:
Phone: 021-7990467. Fax: 021-79109902
Graha CNG. JL. Tebet Timur dalam II No. 35 email:
Jakarta 12820. Indonesia [email protected]
Telp.: +62-21-8319878; Fax: +62-21-8291391
Website: www.rajarafasamudra.com
Website: www.apcngi.org