Efforts to Find a Substitute for Shell in the Masela Block

Royal Dutch Shell Plc (Shell) has indeed not officially come out of the Masela Block Abadi Gas Project, Maluku Province. But that intention has been illustrated by Shell's request to open a data room block that was designed to have an LNG capacity of 9.5 million tons.

Deputy for Operations for the Special Unit for Upstream Oil and Gas Business Activities (SKk Migas), Julius Wiratno said that negotiations between Shell and Inpex Corporation as the holders of 65% participation in the Masela Block were still ongoing.

the Masela Block in Maluku Indonesia

Do not rule out the possibility, the negotiation process will lead to a recalculation of the investment value in the block. This is also supported by situations and conditions that occur where project work has not yet fully taken place.

"Until today Shell has not resigned, there is still a B to B discussion with Inpex. "However, Inpex will continue, the project must start even if it is stumbling, let alone the Covid-19 pandemic," Julius said.

Shell's plan to step down was seen when the company asked permission to open a data room. This step allows potential investors to see the potential of the Masela Block.

SKK Migas has also sent a letter to complete the request for opening the data room. Shell is said to be looking for partners to transfer 35% of its participating shares. However, Shell Indonesia's External Relations Vice President Rhea Sianipar was reluctant to comment on this.

"For the question above, I have no comment," Rhea said.

Until last night, Melia Relations Inpex Corporation Specialist Moch N Kurniawan had not answered Kontan's questions.

Kontan, Page-12, Tuesday, July 7, 2020

Energy Investment Requires Regulatory Certainty

Bad news comes from the Indonesian energy sector. During the Corona pandemic (Covid-19), two foreign investors in the oil, gas, and electricity sectors, Shell and Mitsui, planned to flee their project in Indonesia. 

    Royal Dutch Shell Plc (Shell) intends to leave the Masela Block Abadi Gas Project, Maluku. SKK Migas confirmed, Shell wanted to release 35% of its participation in the block, influenced by Covid-19.

the Masela Block Abadi Gas  Maluku Indonesia

Besides Shell, another foreign investor who wants to escape is Japan's, Mitsui Corp. Mitsui plans to leave the Paiton power plant project, East Java. Mitsui holds a 45.5% stake in the 2,045 megawatts (MW) plant.

The energy business is indeed experiencing a decline. See, the International Energy Agency (IEA) projects total global energy investment this year to fall to US $ 400 billion, down 20% year-on-year (YoY). Earlier this year, energy investment had grown by 2%.

Indonesia was affected. Economist Indef Bhima Yudhistira Adhinegara rate, the reason investors want to get out of Indonesia Iantaran see regulations that are not yet fully friendly and often change.

"They have invested long-term, but there is uncertainty regarding policies and regulations," he said.

Indonesia's competitiveness index in the IMD World Competitiveness Ranking 2020 dropped from rank 32 to 40. Therefore, Bhima said, there needs to be an improvement in the investment climate in the country. 

    The Masela Block project is indeed on a winding road. The process of negotiating, developing, and determining the investment commitment of the Masela Block has been very difficult, namely for more than two decades since 1998.

Inpex Corporation

In July last year, the government approved the proposal of Inpex Corporation, the manager of which holds a 65% stake in the Masela Block's participation. The block's investment value is around the US $ 19.8 billion.

Until now there are no prospective buyers of liquefied natural gas (LNG) that will later be produced from the Masela Block. On the other hand, the development of onshore refineries has not yet begun.

Indonesian Petroleum Asociation (IPA) Executive Director Marjolijn Wajong assessed that depressed oil prices also contributed to the decline in investment. Then the most likely thing to do is respect the contracts that have been made with the investors.

"If you want to change the contract, the government should discuss it first with investors," he said.

Oil and Gas Practitioners and Observers Tumbur Parlindungan hopes that the government will move quickly to improve the country's oil and gas investment climate so that investors will not be shunned after the Covid-19 pandemic.

"The way to provide investment certainty is through safeguarding the sanctity of contracts or contract sanctity as well as improving overlapping rules," he said.

    In the electricity sector, the Executive Director of the Institute for Essential Services Reform (IESR) Fabby Tumiwa believes that Mitsui's plan to leave the Paiton power plant signals that investment in fossil fuel-based plants is no longer attractive.

Mitsui's intention to leave could set a precedent in the electricity sector. Later, other investors will prepare similar options to mitigate investment risks in thermal plants. Therefore, Fabby called on the all-out government to encourage investment in clean energy and energy efficiency.

"The government must have a policy framework that provides certainty," he said.

Kontan, Page-1, Tuesday, July 7, 2020

Shell is fleeing from the Masela Block

Head of SKK Migas Admits Poor Oil and Gas Condition.

Royal Dutch Shell Plc. (Shell) left the Masela Block Abadi Gas Project. Where currently Inpex Corporation (Inpex) as the largest Shell holder of the block is looking for a replacement for Shell.

"That's right (flee). Inpex is looking for a replacement," explained SKK Migas Deputy of Operations Julius Wiratno.

the Masela Block

Julius explained that the reason for Shell's flee from the Masela Block was because of the cash flow conditions affected by the co-19 pandemic situation. Shell decided to focus on other projects that were taking place in Indonesia. 

sHell

    Just so you know, Shell has a participation stake in the Masela Block of 35 percent and 65 percent by Inpex Corporation. Other than that. The Regional Government also confirmed that they would receive a 10 percent share of participating shares.

"In some other projects in other countries, it is not going well or not going well so that the company's cash flow is not good. They focus first on several projects that have already taken place," explained Julius.

He continued, currently, both Inpex Corporation and Shell are continuing discussions on options for taking full participation rights by Inpex. In addition, the option to search for new partners by Inpex also appears. Previous. 

      

Dwi Soetjipto

    The Head of SKK Migas, Dwi Soetjipto, mentioned that the condition of the LNG business that is currently in decline has indeed made some oil and gas companies worry about the project implementation. Including for the Masela Block.

"Currently the oil and gas industry is facing serious problems (including) LNG prices. "There is a fear of project owners like Masela project execution going forward," he said a few days ago.

Julius explained, it is not impossible that the project implementation time will increase. But he ensured, Inpex was committed to completing the project on time. The Masela Block is targeted to be streamlined in 2027.

The long road

The news about Shell's flee from the project, whose investment value reached 20 billion US dollars, is not new. Previously, in mid-May 2019 ago. Nevertheless, both parties continue to work together on the Masela Project. On the other hand, the Masela Project is also being faced with a number of works such as land acquisition and product buyer search.

The journey of the Masela Block liquefied natural gas (LNG) jumbo refinery project in the Tanimbar Islands in Maluku Province is still long. The Masela Block is targeted to produce 421 million cubic feet per day (mmscfd) of gas and 8,400 barrels of oil per day. 

    In addition to being constrained by land issues, Inpex Corporation and Shell Indonesia as the operator have not yet succeeded in finding potential buyers of the liquefied natural gas product. Just so you know, previously Inpex Masela Ltd had entered into an MoU of buying and selling gas from the Abadi LNG Project.

PT Perusahaan Listrik Negara (Persero)

The Masela gas production was purchased by PT Perusahaan Listrik Negara (Persero) and PT Pupuk Indonesia (Persero) in February. 

PT Pupuk Indonesia (Persero)

    The memorandum of understanding was intended to start discussions on sales and purchases to supply LNG gas to gas power plants operated by PLN and natural gas at 150 million standard cubic feet per day (mmscfd) for the co-production refinery to be built by PT Pupuk Indonesia. SKK Migas targets that the buyer search process is expected to be completed in 2021.

Surya, Page-7, Monday, July 6, 2020

THE MORE WEIGHT THE MASELA PROJECT

The Abadi Field development project, the Masela Block, located in the Arafuru Sea, Maluku is considered to be getting heavier. In addition to the uncertainty of buyers from the oil and gas block, liquid gas / LNG market conditions are also still difficult to predict.

the Masela Block

Currently, the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) is reviewing the continuation of the Masela Block development project.

Dwi Soetjipto

SKK Migas Head Dwi Soetjipto said that the price of LNG which fell in the range of US $ 2 per MMBtu greatly affected the economics of the Masela Block project. According to him, the low price of LNG was influenced by the Covid-19 pandemic which hit almost all countries in the world, thus making demand is reduced.

"This is the fear of the project owner as in the Masela Block, project execution going forward," he said.

Dwi revealed, not a few Cooperation Contract contractors (KKKS) submitted a revised work plan this year, because they had to face a very difficult time.

SKK Migas Deputy for Operations Julius Wiratno added by looking at the current conditions, it was possible that the Masela project would be delayed. Julius had revealed that Shell Upstream Overseas Ltd. (Shell) decided to go out and the project, because of cash flow problems due to projects in other countries are stunted.

Inpex Corporation

"Inpex did not step down, which Shell resigned as a partner. All Inpex will be taken over or currently looking for potential partners, "he said.

However, later the statement was corrected.

"Until today Shell hasn't left yet, it's still a B to B discussion, negotiation. The project must continue even if it is limping, "he said.

When it was confirmed by Bisnis Indonesia, both Shell and Inpex management was reluctant to comment on the news of Shell's withdrawal in the project. Meanwhile, Shell originally held 35% of the share of participation in the project. The rest is held by Inpex and regionally-owned enterprises (BUMD) by 10%.

The Trisakti University Teaching Staff Pri Agung Rakhmanto assessed that if it was true that Shell resigned as a strategic partner in the project, the development of the Masela Block project would certainly not be easy. According to him, partner factors in the development of the Masela Block project added complexity to existing problems, such as certainty of gas buyers and Masela's production output. 

On the other hand, he said, the condition of the global LNG market in the next 5 years is projected to also be in an oversupply condition with low prices. So the cost and economic development of the Masela Block will not necessarily be competitive to develop existing fields, "he said.

Inpex Corporation and Shell Upstream Overseas Ltd.

Based on the records, Inpex Corporation and Shell Upstream Overseas Ltd. (Shell) previously signed a cost recovery profit-sharing amendment contract, including an additional 7 years of allocation and extension of the Abadi LNG project with SKK Migas on October 11, 2019.

Bisnis Indonesia, Page-4, Monday, July 6, 2020

Shell Flee the Masela Block Project

SKK Migas: The reason Shell withdrew from the Masela Block due to the financial condition exposed to the corona

The coronavirus pandemic effect (Covid-19) hit many industrial and business sectors globally, also in the country. As a result of the outbreak, Royal Dutch Shell Plc (Shell) decided to leave the Masela Block Abadi Gas Project, Maluku Province. Currently, lnpex Corporation (lnpex) as the largest shareholder in the block is looking for a replacement for Shell.

lnpex Corporation (lnpex)

"Yes, that's right (Shell is retiring). Inpex is looking for a replacement," said Deputy of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Julius Wiratno.

the Masela Block

According to him, the reason for Shell's withdrawal from the Masela Block development project was because of the cash flow conditions that were affected by the Covid-19 pandemic situation. Shell decided to focus on other projects that were taking place in Indonesia. 

Royal Dutch Shell Plc (Shell)

    In the Masela Block, Shell has a 35% stake, while Inpex Corporation 65%. Later, the local government will receive a 10% share of participation taken from the ownership of Shell and lnpex.

"In a number of projects in other countries, it is also lacking or not going well so that the company's cash flow is not good. They (Shell) focus first on a number of projects that have already taken place," said Julius.

Now, both lnpex Corporation and Shell are continuing discussions on the option to take over the full participation by lnpex. In addition, the option to search for new partners also appears by lnpex. 

Rhea Sianipar

    Shell Indonesia management does not want to comment on the development of the Masela Block Abadi Gas Project. Regarding the question above, I have no comment, "said Shell Indonesia's External Relations VP Rhea Sianipar.

Dwi Soetjipto

Previously, SKK Migas Head Dwi Soetjipto mentioned the condition of the liquefied natural gas (LNG) business which was currently in decline, causing several oil and gas companies to worry about the project implementation, including for the Masela Block.

"Currently the oil and gas industry is facing serious problems including LNG prices. There is the fear of project owners such as the Masela Block to execute projects going forward," Dwi Soetjipto said.

The schedule can be Delayed

Julius added that it was not impossible that the time to implement the Masela Block Abadi Gas Project would increase or reverse the original schedule. However, SKK Migas ensures that lnpex is committed to completing projects on time. The Masela Block is targeted to be streamlined in 2027.

On October 11, 2019, Inpex Corporation and Shell Upstream Overseas Ltd together with SKK Migas signed a cost recovery revenue-amendment contract including an additional seven years of allocation and extension of the Abadi liquefied natural gas refinery project with SKK Migas.

The signing marked the implementation of a formal agreement on the terms of the cooperation contract that was previously agreed upon and announced in July 2019. Previously, PT Pertamina (Persero) had expressed interest in participating in the project. Pertamina once sent an official letter to conduct strategic talks on the management of the gas field in 2011 and 2016.

Drama in the Masela Block

Shell Flee from the Masela Block

A series of dramas colored the process of developing the Masela Block. After Shell intends to flee, the manager of Masela, Interp Corporation, must work to secure the project. As a flashback, in the middle of 2019, the Indonesian government and Inpex Corporation had agreed on the Masela Block development plan.

At that time the Minister of Energy and Mineral Resources (ESDM) Ignasius Jonan had to go back and forth from Jakarta-Tokyo to conduct very difficult negotiations. On Tuesday 16 July 2019, finally the Masela Block POD revised document was signed by SKK Migas Chief Dwi Soetjipto and CEO of Corporation Corp Takayuki Ueda at the Merdeka Palace, witnessed by President Joko Widodo and ESDM Minister Ignasius Jonan.

The agreement with an investment value of around US $ 18.5 billion to the US $ 19.8 billion is the culmination of the back and forth negotiations over the development of the Masela project over the past 20 years. Development of the Abadi Gas Field, the Masela Work Area uses an onshore LNG scheme, with lnpex as the operator.

The Abadi LNG Plant is designed to have a capacity of 10.5 million tons of natural gas per year, including around 9.5 million tons of LNG per year, 150 mmscfd of local gas supply through land pipes, and approximately 35,000 barrels of condensate per day.

Kontan, Page-12, Monday, July 6, 2020

Oil Lifting 2020 Predicted 705 Thousand BPD

The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) projects national production of ready-to-sell oil (facelift) up to the end of the year to only reach 705,000 barrels per day (BPD) or more than the security of the security of the food security) by 755,000 BPD. 

   

  This is through with the Covid-19 pandemic. However, SKK Migas is starting to commit to a recovery starting next year. In 2030, oil is targeted to reach 1,000,000 BPD.

"Applying 705,000 BPD that makes sense, we can obtain in 2020. Raise the challenge we are discussing is restoring next year so that next year does not decline again," said SKK Migas Head Dwi Soejipto.

Dwi Soejipto

Dwi said the raised projections were from 15 cooperation contract contractors (KKKS) representing 96% of the national production line. In the first place was occupied by Mobil Cepu LTD then accepted by PT Chevron Pacific Indonesia (CPI) with the Rokan Block.

PT Chevron Pacific Indonesia (CPI)

Although Chevron finished managing the Rokan Block in August 2021, efforts to optimize production are still carried out. It was estimated that it would have decreased by 20 thousand BPD but until the end of May, it could still produce 180 thousand BPD. 

the Rokan Block from Chevron (CPI)

    He said SKK Migas was guarding the transition period for the management of the Rokan Block from Chevron (CPI) to Pertamina. This is to avoid a decrease in production as happened in the Mahakam Block.

the Mahakam Block

"We hope that by the end of the year we will be able to optimize easily. Currently, it is still being discussed with CPI so that they can invest again in this transition period, "he said.

Dwi further agreed to wait for oil and gas projects scheduled to be completed this year. In the third quarter of 2020, a number of migration projects began production, the Malacca Strait Project Phase-1, the Beauty Field in the Belida Block, the Betung Compressor Project and Musi Timur SKG-19, the Meliwis Field in the Madura Offshore Block, and the Peciko Field in the Mahakam Block.

 

"We are optimistic that the additional production from these projects will help achieve the year-end appointment target," Dwi said.

In 2020, SKK Migas starts 11 oil and gas projects can start onstream. To date, five oil and gas projects have been approved and can provide additional oil production of 3,182 BPD and gas 109.5 million standard cubic feet per day / MMSCFD.

Dwi further revealed that there were 4 national strategic projects among Tangguh Train 3, which began at the completion of 2020 essence, until the end of III or the end of 2021. Realization until May 2020 was approved for land 82.45% of the target of 83.15% and offshore 98.15% offshore 98.15% of the target of 99.35%.

Jambaran Tiung Biru

Then, Jambaran Tiung Biru is planned to be streamed from the third quarter of 2021 to the fourth quarter of 2021. Introduced until May yesterday received 64.54% of the 69.60% target. The next project is being prepared by Inpex Abadi Masela and expected to be streamed in 2027. 

Inpex Abadi Masela

   While the Indonesia Deepwater Development (IDD) project for the Gendalo and Gehem working areas is in the process of improving the consortium and developing a development plan (Po) to Development (PoD) to Development (Po)

Gendalo and Gehem Project by Chevron

Oil and Gas Potential

He explained, Indonesia has a huge oil and gas potential with 128 basins. Of these, 27 basins have been produced. He said there was a need to transform possible into the second package by declaring the production of one million barrels in 2030. He said the government was now more flexible for investors to choose the production sharing contract between Gross Split or Cost Recovery.

But he asked for legal protection made by the Oil and Gas Law to guarantee certainty for investors. Even though production reaches 1 barrel jute in 2030, by 2030 it is projected that the demand for fuel oil (BBM) reaches 2.7 million barrels. This means that industry support is needed for fuel oil to gas.

"There must be a policy that encourages using gas, getting relief from those who use fuel," Dwi said.

Investor Daily,  Page-1, Tuesday, June 16, 2020

Masela Still Looking for LNG Buyers

The development of the Masela Block liquefied natural gas or LNG jumbo refinery project in Tanimbar Islands, Maluku Province is still long. Besides being hampered by land issues, Inpex Corporation and Shell Indonesia as the operator have not yet succeeded in finding potential buyers of the liquefied natural gas product. Deputy of Finance and Monetization of SKK Migas, Arief Setiawan Handoko said the process of finding buyers is still long.

So far, there have only been letters of intent (LOL) and memorandums of understanding (MoU) with several parties who have mentioned the purchase volume, some have not, he said.

Previously, Inpex Masela Ltd had conducted an MoU of buying and selling gas from the Masela LNG project with PT PLN (Persero) and PT Pupuk Indonesia (Persero) in February. 

    The memorandum of understanding was intended to start discussions on sales and purchases to supply LNG gas to a gas power plant operated by PLN and natural gas of 150 million standard cubic feet per day (mmscfd) for the co-production refinery to be built by PT Pupuk Indonesia.

But Arief said the MoU had not yet discussed the price scale or product price calculations. Nevertheless, he ensured that SKK Migas continued to record potential buyers, both from the domestic and international markets. 

    SKK Migas is targeting the buyer search process to be completed in 2021. Buyer certainty will also have a positive impact on project sustainability.

In addition to the problem of gas buyers, previously Maluku Governor Murad Ismail has submitted a Governor Decree regarding the determination of the location of the Masela liquefied natural gas refinery port on Nustual Island, Lermatang Village, Tanimbar Selatan District, Tanimbar Islands Regency, Maluku Province, to SKK Migas.

SKK Migas Deputy for Operations Julius Wiratno said the area of ​​the transferred land was still part of the required area.

"Much more is needed to fulfill the LNG refinery development project," he said.

Kontan, Page-12, Wednesday, June 3, 2020

Procurement of the Abadi Port Project Land Begins

The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) stated that it has received a Decree (Maluku) Governor of Maluku regarding the determination of the location of land acquisition for the port of the Abadi LNG Project. Next, land acquisition for this port can be done immediately.

The intended letter is Governor's Decree No. 96 of 2020 which establishes the location of the Abadi Project port on Nustual Island, Lermatang Village, South Tanimbar District, Tanimbar Islands Regency, Maluku. The handover was carried out online by Maluku Governor Murad Ismail in Ambon and SKK Migas Head Dwi Soetjipto in Jakarta.

Dwi Soetjipto

According to Dwi, the submission of the decree was a tangible form of support for the completion of the Abadi Project. Prior to this, the Maluku Provincial Government also quickly issued a Governor's recommendation on a Borrowing and Use of Forest Areas Permit for the Abadi LNG Plant to support the project. This shows the coordination between SKK Migas, Inpex Masela Ltd as the operator, and the regional government is going well.

the Abadi LNG Plant

"Furthermore, with this decree, the land acquisition process can proceed to the next stage, namely the implementation stage in accordance with applicable laws and regulations. "This stage will be held by the National Land Agency (BPN) based on a request from SKK Migas," Dwi Soetjipto said.

For this reason, SKK Migas expects support from all stakeholders at the Maluku Province level, Tanimbar Islands Regency, and the local village government so that land acquisition takes place properly.

Governor Murad revealed, his party was given the authority to issue a decree to determine the location of land acquisition for development in the public interest, including oil and gas infrastructure. It supports the development of the Abadi Project which is expected to have a multiplier effect on the economy and other positive impacts on the people of Maluku.

"This decree is one form of our support for SKK Migas and Inpex as operators of the development of the Abadi Gas Field, the Masela Block which is a National Strategic Project so that the gas project in Maluku Province takes place quickly and smoothly," Murad said.

Before the decree was issued, the Land Procurement Preparation Team formed by the Governor of Maluku had carried out the preparatory stage based on Law Number 2 of 2012 concerning Land Procurement for Development in the Public Interest and Presidential Regulation Number 71 of 2012 concerning Implementation of Land Procurement for Development in the Public Interest and regulations the changes.

These activities include notification, preliminary data collection of locations, and public consultation on development plans, site designation, and the announcement of the location of the development. Meanwhile, President Director of Indonesia Inpex Masela Ltd Akihiro Watanabe appreciated the support of the Maluku Provincial Government and SKK Migas so that the port location decree could be submitted.

"This decree is one of the most important points in the process of land acquisition for the construction of the Abadi LNG refinery port," he said.

Investor Daily, Page-10, Tuesday, June 2, 2020

Upstream Oil and Gas Industry Asked to Maintain Activities and Avoid Layoffs

The Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) requests that the upstream oil and gas industry continue to maintain operations and avoid termination of employment (PHK), in order to maintain the continuity of the industry in the following years, despite being affected by the Covid pandemic. 19 and low world oil prices.

The Head of SKK Migas Dwi Soetjipto said that the achievement of the APBN target in the first quarter was very good, but in the future what was prioritized was how to prevent activities being stopped and no layoffs.

He added, by maintaining upstream oil and gas operations, including in various drilling, maintenance, and other operational programs, the sector was expected to continue to drive the national economy, create a multiplier effect for the regional economy and supporting industries, and maintain the availability of employment.

"Like the blood that continues to flow, the upstream oil and gas industry is expected to continue to drive the pulse of the Indonesian economy," Dwi said.

Meanwhile, SKK Migas Deputy for Operations Julius Wiratno said that until now the commitment of the Cooperation Contract Contractors (KKKS) to achieve the production target is still maintained. From the 1st quarter of 2020 data shows that, for oil production, 7 KKS Contractors exceeded the National Budget target and 8 KKKS exceeded the technical targets in the 2020 Work Plan and Budget. Whereas for gas distribution 5 KKS Contractors were able to exceed the National Budget target and 12 KKS Contractors exceeded the technical target Work Plan and Budget 2020.

SKK Migas has sent a letter of appreciation for KKKS who achieved the target in 2019 and the first quarter of 2020, as well as a warning letter for KKKS that did not reach the target in the first quarter of 2020. In that letter, SKK Migas also submitted input and recommendations for each KKS Contractor based on monitoring the implementation of the Work Plan and Budget and other monitoring so that in the second quarter of 2020 until the end of the year, KKKS who have not yet reached the target can implement the SKK Migas recommendations and those who achieve the target can look for operational ways and innovations so that the achievements obtained can be further improved.

In addition to the operational aspects, SKK Migas through the letter reminded the PSC Contractors to implement the principles of work safety and environmental protection so that the incident rate in the second quarter and until the end of 2020 can be maintained at the specified level.

On Target

Meanwhile, SKK Migas also seeks to prevent the four strategic upstream oil and gas projects from being late in operation despite the Covid-19 pandemic. All projects are targeted to be completed in stages until 2027. SKK Migas Head Dwi Soetjipto said, although the Covid-19 pandemic affected the progress of upstream oil and gas work, the oil and gas contractor working on the four national strategic projects was still committed to completing the project on time.

Jambaran-Tiung Biru Field (JTB)

These four projects are the development of the Train-3 Tangguh Refinery, Jambaran-Tiung Biru Field (JTB), the Masela Block, and the Indonesia Deepwater Development (IDD) Project. One project that is quite constrained by Covid-19 is the development of the Abadi Field, the Masela Block.

Inpex Corporation

"But we are still discussing with Inpex so that onstream (operations) will not retreat from 2027," Dwi Soetjipto said.

Dwi Soetjipto explained the existence of a pandemic hampered the work on the gas project field survey. In order to prevent the spread of Covid-19 from mobility restrictions, a field survey for the Abadi project could not be carried out.

"Maybe there will be a speedup in the coming year," he said.

In addition, a pandemic that suppressed energy demand and global oil prices, Dwi said also made marketing gas that would later be produced from the Abadi Project difficult.

"First of all, what is still constrained is that prospective buyers are still waiting and seeing," he said.

In fact, a commitment to purchase gas is needed so that the Abadi Project can reach the final investment decision / FID stage which is targeted by the end of 2021. So far, Inpex has just obtained a commitment to purchase gas by PT PLN (Persero) 2-3 million tons per year and PT Pupuk Indonesia (Persero) 150 million standard cubic feet per day / mmscfd. At least, around 80% of the 9.5 million tons per year gas production must have a purchase commitment so that FID can be achieved. Constraints due to the Covid-19 pandemic, also experienced by the Train-3 and Jambaran-Tiung Biru Refinery Project.

"But the Train-3 Tangguh Refinery Project will still be on stream (operation) in 2021. Then, JTB is still committed to onstream in 2021," he said.

While the Jambaran-Tiung Biru Project works until the end of March, still referring to SKK Migas data, it still reached 57.91% of the target of 58.17%. So that the project's operating schedule is expected to be slightly delayed from initially the third quarter of 2021 to the fourth quarter of the same year.

The US $ 1.53 billion projects will produce 190 million cubic feet of gas per day / mmscfd. Pertamina EP Cepu President Director Jamsaton Nababan once revealed that the JTB Project was a little late compared to the schedule. However, this delay range is still fairly reasonable and can still be pursued.

It has prepared a number of strategies to pursue this delay. In April-May, he was optimistic that he could return the JTB Project's progress according to plan. The investment value of these four national strategic projects reaches the US $ 37.21 billion. While the additional oil production is 65 thousand BPD and 3,484 mmscfd of gas.

Investor Daily, Page-9, Monday, May 4, 2020