Indonesia Defends Pipeline Gas Export Reductions to Singapore

Indonesia defended its natural gas export reductions on October 26, stating that the supply cuts to Singapore remained within contractual limits and prioritized domestic electricity needs.

Energy and Mineral Resources Minister Bahlil Lahadalia said Indonesia reduced piped gas exports by 31 million standard cubic feet per day from the Natuna Sea and mainland Sumatra.

The reduction represents about 8 percent of the 409.55 million standard cubic feet normally supplied through pipelines to the neighboring nation.

The dispute strains diplomatic ties between the Southeast Asian nations as Singapore works to secure its energy supplies and expand its power infrastructure.

“Do not lecture Indonesia about its commitment to honouring and respecting contracts,” said Bahlil Lahadalia, the Energy and Mineral Resources Minister.

“The 31 million that we have reduced is still within the minimum contractual limits. If we had reduced supplies by 10 per cent, then we would have breached the contract,” he said.

The export cuts began on October 24 to redirect supplies toward domestic electricity demands in Batam, Bintan, and Sumatra.

Singapore Prime Minister Lawrence Wong responded on October 25 by stating that the republic expected all parties to fulfill their obligations.

“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,” said Lawrence Wong, the Singapore Prime Minister.

Singapore’s Energy Market Authority reported that importers experienced a total reduction of 17 billion British thermal units per day over 18 days.

That volume accounts for less than 2 percent of the daily gas demand in Singapore.

Tan See Leng, the Singapore Minister for Energy, Trade and Industry, warned during Singapore International Energy Week that resource nationalism could deter future energy investments.

Existing gas supply contracts between the two countries remain active until the end of 2028.

Negotiations also continue regarding proposed electricity exports from Indonesia to Singapore, though pricing disagreements remain unresolved.

Bahlil declined to confirm whether the gas export reductions would become permanent.