Abadi LNG Project to Remain a Priority for Indonesia Government

Indonesia’s interim energy minister Luhut Pandjaita has said that the Abadi LNG project would remain on the priority list, according to Jakarta Post.  

Arcandra Tahar, Pandjaita’s predecessor, was dismissed when allegations surfaced that he possessed dual US-Indonesian citizenship, which is illegal in the country. During his tenure, Arcandra had stated that it was possible for the cost of the $16 billion Abadi project to be reduced even further to $15 billion.

The project has been caught up in uncertainties pertaining to its structure. In September, Inpex, the Japanese firm which is developing the project, submitted a revised plan of development of the Abadi gas field in the Masela Block, Arafura Sea. The revised plan envisioned the adoption of a FLNG plant with an annual LNG processing capacity of 7.5 million tons. The initial plan of development was based on developing the Abadi gas field in stages and targeted the deployment of an FLNG plant with an annual LNG processing capacity of 2.5 million tons as the first stage of development.

In April this year, the Japanese firm received a notification from Indonesian government authorities instructing to re-propose a plan of development based on onshore LNG for the project.

Last month, Inpex said it is taking steps to quickly bring to fruition the Abadi LNG project. Inpex stated it will negotiate with government authorities for the optimal development of the project with the goal of early start-up of development.

“Under a policy that seeks the project’s early start-up, the company operates on the basis of selecting the most technologically and economically rational choices and moving the project forward. In line with this basic policy, we are now reviewing how optimal development, including the onshore LNG development system, can be achieved. We will discuss this with our partner, Royal Dutch Shell, and Indonesian government authorities,” Inpex said in its annual report which was released on July 29.