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No quick progress in sight for Masela Block development
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Operations at the Masela oil and gas block are pictured in this undated photograph. (Courtesy of/maritim.go.id)
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s the Abadi liquefied natural gas (LNG) project in the Masela Block remains in limbo, pressure is mounting for the government to create a more favorable investment climate for upstream development.
Moshe Rizal, secretary-general of the Oil and Gas Companies Association (Aspermigas), said the volatile state of the international oil market due to the looming global recession and ongoing energy transition, among other factors, made it difficult to draw investor interest to the project.
“The chance of getting a deal from [any company] to replace Shell before year-end is very slim,” he told The Jakarta Post on Wednesday, adding that the evaluation and due diligence process leading up to the final investment decision (FID) would take “months and years” considering the project’s enormous scale.
Read also: Oil, gas sector urgently needs aggressive reform as targets missed
Previously, the development of the Masela Block was set to enter the FID stage by the end of 2023.
Upstream Oil and Gas Regulatory Task Force (SKK Migas) head Dwi Soetjipto told reporters on Wednesday that the task force would finalize the revision of the plan of development (POD), which would include a carbon capture, utilization and storage (CCUS) facility.
Considering stakeholders only have a month left, Moshe was skeptical that a POD would be finalized by the end of this year. “[The POD] must be concluded [by year-end], but the most important thing is immediately getting a partner for Inpex.”
