The Abadi LNG Project in the Masela Block, Maluku, is certain to be the first liquefied natural gas project in Indonesia to integrate Carbon Capture and Storage (CCS) technology from the start of its development.

INPEX Corporation CEO, Takayuki Ueda, emphasized that the implementation of CCS since the design stage makes the Abadi LNG project a pioneer in the development of clean energy in Indonesia.

"In addition to strengthening national energy security, this project is also an important instrument in achieving Indonesia's decarbonization target," Ueda told a press conference, held in Jakarta, on Wednesday, April 9, 2025.

According to Ueda, this project faces major challenges because the government's target is quite ambitious: completing the Final Investment Decision (FID) and starting production before 2030.

He said that in general practice, it takes around two years for the pre-FID and FID stages, and four to five years for the implementation of engineering, procurement, and construction (EPC).

"The government has requested acceleration because demand for LNG continues to increase. So, we will do our best," he said.

Ueda expressed optimism that the project will run according to schedule, considering that domestic demand for LNG continues to grow. In addition, INPEX has conducted intensive communication with a number of potential buyers, both domestically and in Asian countries such as Japan.

"Demand in the Asian region will continue to increase until 2040 and 2050. So we have to balance the portfolio between domestic needs and exports," he explained.

However, the Masela Block project is not without obstacles. Before the launch of the Front-End Engineering Design (FEED) stage in February 2025, the government had sent a warning letter to INPEX regarding the slow progress of the project. The government urged acceleration, including a gas purchase agreement so that the FID could be achieved immediately.

The Masela Block itself has gone through a long journey. First discovered in 2000 by INPEX, the Japanese oil and gas company then partnered with Shell in 2011. At that time, the share composition was 65 percent INPEX and 35 percent Shell.

The project's development plan (Plan of Development) was completed at the end of 2015 with a floating LNG refinery construction scheme (offshore). However, differences of opinion within the government regarding the efficiency between offshore and onshore schemes delayed the project.

The administration led by 7th President Joko “Jokowi”Widodo finally decided that the project would be implemented onshore. This decision changed the direction of the project and caused quite a long delay. The uncertainty made Shell decide to withdraw from the project in 2020.

The new project showed clarity again in 2023 after Pertamina and Petronas officially took over Shell's participation rights with a transaction value of US$650 million or around Rp9.8 trillion. Currently, the project ownership structure is INPEX 65 percent, Pertamina Hulu Energi Masela 20 percent, and Petronas Masela 15 percent.