Singapore and Indonesia have reaffirmed their commitment to uphold existing gas supply agreements despite ongoing concerns over Indonesia’s recent reduction in natural gas exports to the city-state. The reduction, amounting to 31 billion British thermal units per day (BBTUD), was implemented by Indonesia citing the need to prioritize its domestic energy needs. Jakarta maintains that this cut remains within the permissible limits of their agreements.
During a visit to Jakarta, Singapore’s Foreign Minister Vivian Balakrishnan emphasized the importance of respecting contractual obligations, underscoring how these commitments contribute to the credibility and competitiveness of both nations’ economies. He urged all parties to consider the actions of both governments in conjunction with their public statements.
This development follows a statement from Singapore Prime Minister Lawrence Wong, who called on gas suppliers to adhere to their commitments. Singapore has also suggested potential recourse if Indonesia’s actions are found to breach commercial agreements.
Indonesia’s Energy Minister Bahlil Lahadalia defended the decision, asserting that the existing agreement allows for supply reductions of up to 92 BBTUD. He dismissed Singapore’s criticisms regarding Indonesia’s adherence to its contractual obligations.
Minister Balakrishnan confirmed that high-level communications had occurred between the two countries, involving discussions with Indonesian President Prabowo Subianto, though he did not divulge specific details of these conversations.
Before the reduction, Indonesia was supplying around 409.55 BBTUD of natural gas to Singapore via pipeline networks, supplemented by liquefied natural gas shipments. The reaffirmation of commitment by both nations aims to manage tensions and ensure the stability of their energy trade relations.