| Contract area (block) | Project status | Venture company (established) | Interest owned (*Operator) |
|---|---|---|---|
| Masela | Preparation for development | INPEX Masela, Ltd. (Dec. 2, 1998) |
|
Project History
| 1998 | Acquired 100% interest in Masela Block |
|---|---|
| 2000 | Discovered Abadi Gas Field |
| 2019 | Received approval from the Indonesian government for the development plan to produce 9.5 million tons of LNG per year |
| 2023 | Pertamina and PETRONAS joined the project as new partners Received approval from the Indonesian government for a revised development plan incorporating CCS |
Approval of Revised Development Plan and Participation of New Partners
The INPEX-operated Abadi LNG Project is one of the largest projects in Asia. Once launched, this project will enable the stable supply of energy over the long term in Asia. By liquefying natural gas from the Abadi Gas Field at an onshore LNG facility, the project is expected to produce approximately 9.5 million tons of LNG per year, up to 35,000 barrels of condensate per day and approximately 150 million cubic feet of natural gas per day.
An initial development plan was approved by the Indonesian government in 2019. However, aspiring to make the project cleaner ensuring long-term competitiveness and improving sustainability, we decided to introduce CCS and submitted a revised development plan to the Indonesian government in April 2023, which was approved in December 2023. Additionally, Indonesia's Pertamina and Malaysia's PETRONAS joined the project as new partners in October 2023. Both partners are companies with extensive experience in Oil and gas development in Indonesia and LNG projects globally.
Responding to Natural Gas Demand in Asia
We will continue to carry out the necessary development preparations, including front-end engineering design (FEED), obtaining environmental permits, project site acquisition and marketing and project financing, in close collaboration and cooperation with Pertamina and Petronas.
Achievement of both cleaner energy and cost competitiveness
Realizing a net zero carbon society is an urgent challenge. In this project, we plan to neutralize the CO2 emitted from natural gas production at the Abadi Gas Field through the introduction of CCS. This project is the first in which CCS costs are eligible for recovery based on the production sharing contract (PSC) framework governing upstream oil and natural gas projects in Indonesia.
Production sharing contracts are agreements by which an oil and natural gas development company serves as a contractor that undertakes exploration and development work on a project on behalf of the governments of oil-producing countries at its own expense. When exploration and development work results in the production of oil or natural gas, the contractor recovers the exploration and development costs it incurred by means of a share in the crude oil or natural gas produced. The remaining portion is shared between the oil-producing country and the contractor according to a fixed allocation ratio.
These production sharing contracts are used in the development and production of oil and natural gas in Indonesia. Government approval is required when determining the extent of allowable cost recovery, and a greater extent of cost recovery leads to improved cash flow and project economics for the contractor.
Improvement of energy security in Asian countries
Demand for natural gas as one of the main sources of energy to support the energy transition is expected to remain robust in Asian countries. Taking advantage of the strategic location of this large-scale LNG project, which is one of few in the Asia Pacific region, we plan to widely market the LNG to buyers in Indonesia where demand is expected to grow, as well as to traditional LNG buyers in East Asia and emerging buyers in Southeast Asia, South Asia and elsewhere.
