Pertamina is looking forward to making the final investment decision (FID) for the LNG Abadi Block Masela project in the Tanimbar Islands, Maluku, in the next one to two years.
Fadjar Djoko Santoso, Pertamina’s VP Corporate Communication, mentioned ongoing discussions with the block’s operator, Inpex Masela Ltd, regarding the follow-up to the approved plan of development (PoD) for the field by Minister of Energy and Mineral Resources Arifin Tasrif on November 28, 2023.
Fadjar confirmed that once the finalization is complete, the FID is expected to be submitted within an estimated one to two years.
Pertamina is set to participate in the investment based on its current participating interest (PI) percentage of 20%. The total estimated investment and operational costs for the LNG Abadi Block Masela project are currently at US$34.74 billion, equivalent to IDR 535.96 trillion (assuming an exchange rate of IDR 15,428 per US dollar).
The development plan’s cost estimate includes investment costs, excluding sunk costs, of US$20.94 billion (including CCS investment of US$1.08 billion), operating costs of US$12.97 billion, and Abandonment and Site Restoration (ASR) costs of US$830 million.
The revised development plan now includes investments in carbon capture storage (CCS) facilities, with the project’s operational target set for 2030 or the next seven years.
Director General of Oil and Gas at the Ministry of Energy and Mineral Resources Tutuka Ariadji stated that Inpex can proceed with the development activities for the Abadi Field according to the PoD.
Specifically, Inpex will conduct the design and engineering (FEED) for OLNG, FPSO, GEP, and SURF in 2024, site preparation in 2025, and drilling preparation in 2026.
The cooperation contract for the Masela Block was signed on November 16, 1998, for a 30-year period and has received a 7-year time compensation and a recent 20-year extension, making the contract for the Abadi gas field end on November 15, 2055.
The current participating interest holders in the Masela Block are Inpex Masela Ltd (65%), PT Pertamina Hulu Energi Masela (20%), and Petronas Masela Sdn. Bhd (15%).
The Masela Block is one of the largest oil and gas prospects in Indonesia, with production estimated to reach 1,600 million cubic feet per day (MMscfd) of gas or equivalent to 9.5 million metric tons per annum (mtpa) and 150 MMscfd of pipeline gas, as well as 35,000 barrels per day (bcpd) of condensate.
The project, initially estimated to cost up to US$19.8 billion, will become Inpex’s second-largest gas management asset after the Ichthys LNG Project in Australia.
The Abadi Masela Block project is expected to cover over 10% of Japan’s annual LNG import needs and contribute to energy supply resilience in Indonesia, Japan, and other Asian countries.
