Inpex starts pre-FEED of Masela block project

Inpex Corp, operator of the Masela block, has started making preparations to implement the required pre-front end engineering design (pre-FEED) for the planned Abadi gas field development project in the block following directive from the upstream oil and gas authority SKK Migas, Bisnis Indonesia reported on Wednesday.

?Inpex has started preparations for the pre-FEED,? said Inpex Vice President for Corporate Services, Nico Muhyiddin to the paper.

The paper said that during a May 16 visit by Minister of Energy and Mineral Resources Ignasius Jonan to Japan, it was finally agreed that the pre-FEED will be made for an onshore LNG plant with a single production capacity option in one location. The minister initially demanded Inpex to make pre-FEED for two capacity options in two alternative locations, a request reportedly objected by Inpex.

The paper said that according to the SKK Migas directive, the onshore LNG production facility will have capacity of 9.5 million tons per annum plus a pipeline gas production capacity of 150 mmscfd.

Once the pre-FEED phase has been completed, Inpex will then proceed with formulating a revised plan of development (POD) for the Abadi field project, which the ministry targeted to start production in 2026. Once the revised POD has been approved, Inpex will then negotiate for the final FEED including discussions on required incentives such as tax.

President Joko Widodo decided in March for Inpex to develop onshore LNG facility at the Masela block project in Maluku Province, despite an earlier proposal from the company and partner Shell to build an offshore facility. Inpex has demanded a number of incentives for the government to make the onshore project commercially feasible including increasing the LNG production facility to 9.5 mtpa from the initial plan of 7.5 mtpa. (*)