Inpex told to immediately start Pre-FEED for Masela project

Petromindo

Deputy Minister of Energy and Mineral Resources Arcandra Tahar urged Inpex Corp, the operator of the Masela block, to quickly start making the preliminary front end engineering design (Pre-FEED) for the planned Abadi gas development project in the block.

He said on Thursday that Inpex must make Pre-FEED for two options: onshore LNG production facility with capacity of 7.5 million tons per annum plus pipeline gas of 474 mmscfd, and capacity of 9.5 mtpa plus pipeline gas of 150 mmscfd. There are also two alternative locations for the project: Aru Island or Yamdena Island, in Maluku Province.

The Pre-FEED is intended to get estimate of the required investment, and construction schedule. Arcandra said that once Inpex starts the Pre-FEED the government via the Ministry of Industry will also help the company in identifying domestic industries that would absorb the pipeline gas from the project.

Inpex, however, in a February letter to Minister of Energy and Mineral Resources Ignasius Jonan has asked the government to first decide on the location for the project and the capacity of the LNG production facility before the company starts the Pre-FEED.

Arcandra said that the minister responded to the letter, but declined to disclose what the response was. Inpex Indonesia Senior Manager for Communication and Relations Usman Slamet confirmed that the company received on Wednesday the response letter from the minister, but declined to provide details.

President Joko Widodo decided in March for Inpex to develop onshore LNG facility at the Masela block project in Maluku, 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. (*)