Indonesian Minister of Energy and Mineral Resources Arifin Tasrif, announced that the Italian oil company ENI, will become the new operator of the Indonesia Deepwater Development (IDD) project starting from the end of May 2023. ENI would replace the position previously held by Chevron.
However, the timeline on the sales and purchase agreement (SPA) signing between Chevron and ENI was different from the earlier statement of Head of the Upstream Oil and Gas Special Regulatory Force Dewi Soetjipto, who said that the signing would be done in early April. Instead, the signing is scheduled to be completed in May 2023.
After signing the SPA, ENI could then continue the project, which had stalled for a long time in the Kutai Basin, East Kalimantan, after Chevron resigned in July 2019.
Chevron has also officially released 62 percent of its participating interest (PI) for US$5 billion in the IDD project to ENI because ENI had been participating in the Chevron-led consortium and possessed 20 percent of participating interest, while the other 17 percent was owned by China Petroleum and Chemical corporation (Sinopec).
ENI will submit a plan of development (PoD) for the IDD project by the end of this year after completing the management transfer process. The project could start running effectively early next year.
The project requires at least 4 to 5 years to go onstream. Moreover, Chevron only did a pre-front-end engineering design (FEED).
According to SKK Migas, this IDD project will produce 500 million cubic feet per day (MMSCFD) of gas from the Gendalo Field in the Rapak Block and 420 MMSCFD from the Gehem Field in the Ganal Block.
The IDD operational areas
ENI could save investment costs if it continued the development of the IDD project, which includes the Gendalo and Gehem fields. ENI has also already built production facilities, such as the Jangkrik Floating Production Unit (FPU), that it can integrate with the project.
According to SKK Migas, this project which had two operational areas: north and south are also aimed to integrate ENI’s portofolio, including the Jangkrik Field in the Muara Bakau Block and part of Kutai Basin in East Kalimantan’s offshore.
The southern area will supply gas to ENI’s Jangkrik FPU by integrating with the Maha-2 Field in the Muara Bakau Block. The northern site will link with Merakes Field in the East Sepinggan Block, which recently showed ENI’s remarkable success in development. This Italian company will thus manage significant oil and gas assets East Kalimantan’s offshore.
