Japan’s Inpex has reiterated that it is targeting start-up of the stalled Abadi LNG project in the Masela Block offshore Indonesia in the early 2030s.
During its 1H results, Inpex said it is continuing “negotiations with the Indonesian government and concerned parties for the re-revision of the plan of development, aiming to reach FID in the second half of the 2020s.”
The company added it is carrying out a “comprehensive study of measures including introduction of CCUS to make the project cleaner and further reduce costs and promote the project as a competitive and clean project with the aim of commencing production in the early 2030s.”
Inpex, operator of the Masela Block, said in August 2021 that it did not plan to take a final investment decision (FID) until around 2024-2025, two years later than previous guidance of 2022-2023. The latest announcement represents a further delay for the project’s FID.
The Masela development has long struggled to gain traction. Moreover, Shell’s divestment process has so far been unsuccessful, adding further uncertainty for the stalled project, which holds 360 billion cubic metres (cm) of gas in the Abadi field.
As Energy Voice reported recently, the Indonesian government is directing national oil company Pertamina to buy Shell’s (LON:SHEL) 35% equity in the proposed Abadi liquefied natural gas (LNG) project in the Masela Block offshore Indonesia that is led by Japan’s Inpex (TYO:1605).
It remains to be seen if the national oil company is willing to buy out Shell and whether it has the resources to do so. Some industry experts have suggested that the government of Indonesia should shift its focus to encouraging Shell to remain invested in the proposed 9.5 million tonne per year LNG development instead of pushing Pertamina to acquire the supermajor’s stake.