REPUBLIKA.CO.ID, JAKARTA -- Minister of Energy and Mineral Resources (ESDM) Ignasius Jonan discussed the development of Masela Block after concluding a work visit to Japan from Monday to Wednesday.
One of the important outcomes is the continued development of the Masela Block, which is the outcome of a discussion with Inpex Corp CEO Toshiaki Kitamura in Tokyo, Japan, Tuesday.
Based on data from the ESDM Ministry received by Antara in Jakarta on Thursday, the discussion resulted in three decisions being made, the first being the government still requests Inpex to develop a liquefied natural gas (LNG) facility on land in accordance with President Joko Widodo's instructions.
Second, the government will extend Inpex's contract for 20 years and add seven more years as compensation for changing the refinery development scheme from floating to land-based. Thirdly, the government offers Inpex the flexibility to choose the site for the LNG refinery.
The government's decision will give a 20-year extension to Inpex, as their contract is almost over. It has been granted an additional seven years as compensation for the change in the floating refinery expansion scheme to onshore, Jonan noted.
On receipt of a working letter from the Upstream Oil and Gas Regulator (SKK Migas), Inpex is currently conducting a pre front-end engineering design (pre-FEED). Following the ESDM minister's visit to Japan on May 16, 2017, it has been agreed that pre-FEED is being conducted with an option of production capacity and an island.
As for the warrant, the LNG refinery capacity was set at 9.5 million tons per annum, and the production of gas was set at 150 million standard cubic feet per day. Pre-FEED will be a crucial step in formulating a revised field development plan (PoD).
Earlier PoD revisions were made to increase the LNG production capacity while still using a floating refinery scheme.
The Masela Block operation agreement was signed in 1998 by Inpex, as the operator, with a 65 percent ownership and Shell Upstream Overseas Services, with a 35 percent stake. The Indonesian government is optimistic that Inpex would start the gas field project immediately.
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