Indonesia energy company PT Perusahaan Gas Negara (PGN) recently increased prices for customers in West Java following recent contract renewals.
Gas produced under the new contracts will be sold for around $US10.13 per British thermal unit compared to the previous contract price of $6.80/btu.
The price hike is driven by steadily increasing gas demand for commercial power generation in Java and PGN's supply contracts, which have also risen significantly.
Another factor to the price increase is PGN's difficulty in meeting supply obligations under existing sales agreements due to problems obtaining gas from producers.
Quest Petroleum chairman Gus Simpson said the price increase signalled excess demand for South Sumatran gas in Java and had positive implications for the economics of gas discoveries in the Ranau PSC.
Quest is planning to carry out a gas exploration drilling program on the PSC in the next few months.