Sudirman: Masela FID likely to be postponed

By Febry Silaban

The Final Investment Decision (FID) for the Abadi gas project in Masela block in Maluku province is likely to be made later than the initial schedule as a consequence of the government?s rejection of the Plan of Development (PoD) proposed by the operator of the block, Japanese firm Inpex Corp, according to Minister of Energy and Mineral Resources Sudirman Said.

According to the initial schedule made by the government, Inpex should have made the FID for the block by 2018.

Sudirman said during the hearing with the House of Representatives on Tuesday that the year 2018 was set as the schedule for the FID on the assumption of the PoD proposed by Inpex was accepted.

Inpex and its partner Royal Dutch Shell proposed to build a floating LNG plant to process the gas from the Abadi field. President Joko Widodo however recently decided that the LNG plant should be built onshore rather than offshore.

Sudirman said as a follow-up to the President?s decision, he had instructed upstream authority SKK Migas to ensure that any delay in FID should not be long and communicate the President?s decision to the Maluku provincial government. In particular, SKK Migas has asked the provincial governor to tell the province?s regents to avoid potential conflict among them over location for the LNG plant.

One of the concerns that have been raised following the President?s decision is that authorities of many islands in the province will fight each other over right to host the LNG plant. The island that will be chosen to be the site of the LNG plant will benefit from the project the most.

Editing by Johannes Simbolon