SE Asia targets 28 tcf in new deepwater gas push, faces tight economics
Tuesday, May 5 2026 - 07:19 PM WIB
By Romel S. Gurky
Southeast Asia is entering a new phase of deepwater gas development targeting around 28 trillion cubic feet of resources across Indonesia, Malaysia, and Brunei, according to a report by Wood Mackenzie.
The second wave of projects, described as “Deepwater 2.0,” is expected to require more than $20 billion in investment by 2030, covering six major developments across the region.
Key projects include North Ganal, Rapak, and Ganal in Indonesia’s Kutei Basin, the South Andaman developments in North Sumatra, Kelidang in Brunei, and Rosmari-Majoram in Malaysia.
The push comes as existing shallow-water and onshore gas fields decline. Indonesia’s non-associated offshore gas production has fallen more than 12% since 2018, while Malaysia is expected to source about 20% of its gas from deepwater by 2027. Brunei will need an additional 500 million cubic feet per day of gas supply after 2030 to sustain LNG output.
Read also: Southeast Asia enters ‘Deepwater 2.0’ as gas projects regain momentum
Operators involved in the projects include Eni, Shell, PETRONAS, and Mubadala Energy.
Wood Mackenzie said project economics remain tight, with many developments expected to generate internal rates of return of around 15%. The analysis showed that a 20% increase in capital expenditure or a similar decline in gas prices or output could significantly reduce project value, while delays of up to three years could halve returns.
Operators are pursuing faster development timelines to improve viability. Eni is targeting about five years from discovery to first gas at its Geng North project, while Mubadala is advancing phased development in North Sumatra.
The report also highlighted supply chain constraints and cost inflation linked to geopolitical tensions, including conflicts in the Middle East, as key risks to project execution.
Wood Mackenzie said the next five years will be critical in determining whether the region can deliver these projects on time and within budget, as countries increasingly rely on deepwater gas to support domestic supply and LNG exports.
Editing by Alexander Ginting