MEMR to decide on Masela POD on Oct.10
Thursday, September 24 2015 - 02:37 AM WIB
The statement was made during a press conference , specially arranged on Wednesday amid emerging controversies over the gas project sparked by a proposal from Coordinating Minister of Maritime Affairs Rizal Ramli, which is different from the one from the owners of the project ? Japanese firm INPEX Corp. and European energy giant Royal Dutch Shell.
Rizal said economically, it would be more beneficial to the country if the LNG plant to process the gas from the giant field is built onshore on Aru Island, some 600 km from the field. Differently, INPEX and Shell in their POD, proposed to build a floating LNG (FLNG) plant on the seawater above the field.
By law, the ministry?s Secretary General Teguh Pamudji said the minister holds the ultimate right to decide on the PoD. Before making a decision, the ministry along with upstream authority SKK Migas will carefully study the project.
?On Friday, Sept. 25, a workshop will be held by SKK Migas and the Directorate General of Oil and Gas to identify the main goals that will bring more benefits to the country. What is clear is that the minister will make a decision on Oct. 10, 2015 at the latest,? Teguh said during the press conference.
According to Teguh, SKK Migas has submitted a recommendation on the revised POD for the Abadi project to the ministry for approval. The revised POD was proposed by INPEX and Shell following the increase in the gas reserve of the field. In the first POD, approved by the ministry on Dec. 30, 2008, INPEX planned to build a one-train FLNG plant with a capacity of 2.5 mtpa, based on certified reserve of 6.05 tcf. In the revised POD, INPEX plans to build a three-train FLNG plant with a total capacity of 7.5 tcf, based on a certified gas reserve of 10.37 tcf. They submitted the revised POD to SKK Migas on Sept. 3, 2015. SKK Migas subsequently forwarded the revised PoD to the ministry on Sept. 10 for approval.
The field?s certified gas reserve has increased from 6.05 tcf to 10.37 tcf following the discovery of additional reserve by INPEX during explorations in 2013-2014, according to the ministry.
Director General of Oil and Gas IGN Wiratmaja said after receiving the POD, the minister held a coordinating meeting involving SKK Migas and the Directorate General of Oil and Gas. During the meeting, it was decided that the directorate general will carry out analysis, evaluation and review, involving experts. The result will be publicly announced on Oct. 10.
?We have asked all related documents to be submitted to us. We shall also invite competent experts. The evaluation result will be submitted to the minister (as a basis) for him to make a crystal clear decision on Masela block,? Wiratmaja said.
He said the evaluation is necessary because Masela contains huge gas, but also has complex problems.
Meanwhile, SKK Migas? Chairman Amien Sunaryadi explained that the time needed for the construction of either FLNG or onshore LNG plants is more or less the same, between 45-50 months. From economic point of view, based on calculations in 2013, the development cost of an onshore LNG plant reaches US$19.3 billion, compared to $14.8 billion for an FLNG plant.
Editing by Johannes Simbolon