Indonesia Approves Revised Abadi LNG Plan

Indonesia’s energy ministry has approved a revised plan of development (POD) for the Abadi LNG project, it said July 12.

The ministry said that the approval has been granted in accordance with the recommendations of Indonesia’s upstream regulator, SKKMigas.

Japanese Inpex Corporation last month had submitted a revised POD for the Abadi LNG project to the authorities. The revised POD, issued via subsidiary Inpex Masela, is based on an onshore LNG development scheme with an annual LNG production capacity of 9.5mn metric tons/year. The project involves developing the Abadi gas field in the Masela Block, in the Arafura Sea.

In addition to submitting the revised POD, Inpex, in partnership with Shell, filed an application to extend the production-sharing contract for the Masela Block. This amendment accommodates the additional seven years of the PSC term owing to the time spent studying the previously proposed development scheme, it said.

The Masela block contract was signed in 1998, and Inpex as operator owns 65% share in the block while Shell owns the rest.

The project is the first large-scale integrated LNG development project operated by Inpex in Indonesia. In March 2016, the country's president Joko Widodo said the LNG project will be built onshore, instead of offshore as Inpex had proposed. As a result, the Japanese company had to review its plans.