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Offshore scheme for Masela is sufficient: SKK Migas
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Visitors examine a gas processing facility model during the Indogas Exhibition in Jakarta on Tuesday. The Upstream Oil and Gas Regulatory Special Task Force (SKKMigas) unveiled several gas-sale agreements at the event. (JP/Ricky Yudhistira)
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n its response to Masela gas block offshore scheme critics, Upstream Oil and Gas regulatory special task force (SKK Migas) said that the offshore scheme design for the block was complete, both from an economic and technical point of view.
SKK Migas has already surveyed the area, researched the best and cheapest vendor to construct the offshore platform, a design for supporting industries and the scheme of economic development, SKK Migas chairman Amien Sunaryadi said Thursday.
He added the study was carried out by both independent institutions and the government's partners.
"To understand the situation, you need to go there first. The Selaru Island nearby the block is small and the tide is high. Among the presidents, only Soekarno has traveled there," said Amien, adding that an onshore facility would disturb the island’s tourism and fisheries potential.
A change to an onshore plan of development (POD) would require the engineering design to be started from scratch, he said. "Engineering design would take at least three years, the onshore development will need tough undersea piping as the area is a high wave zone," Amien explained.
SKK Migas has also studied the economic factors, especially the push for a petrochemical company in Maluku, owned by government and regional government whose development would be financed with money from the contract, he added.
With the offshore option, the government’s income would be larger; it would have more money to build the derived industry, he said.
The Masela block was signed off in 1998 in the form of a Production Sharing Contract (PSC) signed between Inpex and BPPKA Pertamina, before it had changed its name to BPK Migas and then to SKK Migas. Prior to 2010 the Plan of Development (POD) had been agreed at 2.5 million tons. The FLNG offshore system had been agreed upon and Inpex had already paid more than US$ 200 million for the contract.
Since 2008 there has been an onshore-offshore debate. After drilling in the development well between June 2013 to April 2014, Inpex increased its deposit estimate to 10.37 trillion cubic feet (TCF) from the previous 6.05 TCF.
On September 12, 2014, Inpex submitted a revision to change production from 2.5 million tons to 7.5 million tons but the revision approval has been delayed due to the return of the offshore-onshore debate.
The offshore model will use a Floating Liquefied Natural Gas (FLNG) Ship as a platform. The ship will be chained, locked into one position. SKK feels that the ship can also be used as a border marker, Amien said.
"The block is very close to Darwin [Australia], we will hoist an Indonesian flag so the block area will not be disturbed by our neighbors," he added. (bbn)
