Andalas Energy, Pertamina to Work on Marginal Gas Fields

Andalas Energy and Power and state-owned Pertamina will work to fast-track commercialisation of marginal gas fields within the latter’s acreage in Indonesia.

The two parties have signed an agreement to establish a joint working and steering committee. “The execution of this agreement represents substantial progress by Andalas in the implementation of its gas-to-power strategy with a world-class partner,” Andalas said September 1.

Initial focus is to identify at least five stranded gas fields within Pertamina’s acreage in Riau, Jambi and South Sumatra provinces which are suitable for sub-100-MW gas-to-power development in the form of an independent power project (IPP).  Once the initial five fields have been identified both parties will sign an exclusive joint development agreement to design, construct, fund and operate the IPPs. More partners could also be invited to join in during the development phase, Andalas added.

According to the company, all target areas have an abundance of stranded gas fields that have been identified.

Indonesia is witnessing increasing demand for power and is seeking to increase electricity capacity by 35 GW by 2019. A lot of the focus has been on gas-fired projects. 

Demand for gas is expanding rapidly in southeast Asia. Expectation of robust energy demand growth has attracted global majors to the region. In May, Italy’s Enel and Japan’s Marubeni Corporation said they would look together for opportunities in the gas-fired power generation sector in the Asia-Pacific region.

Shardul Sharma