Masela bloc still has long way to go

JAKARTA. The Government of Indonesia and Japan based company Inpex Corporation have not reached the agreement over the Inpex’s requests related to the gas mega project in the Sout Maluku bloc (Masela bloc).

There is no significant progress related to the issue since the government replied the letter from Inpex Corporation on 13 October 2016.
To date, the government has not decided yet whether to approve all or a part of Inpex’s requests.

Previously, Inpex had proposed five things to the government, including the increase in production capacity to 9.5 mtpa, the licensing process, incentives provision, an extension of cooperation contract for 10 years, and the proposal on the refundable project costs.

Let alone, Inpex claimed to conduct intensive meeting twice a week with the Government of Indonesia. “We are optimistic that the project will run, as we had positive discussions. We belive that the government will support this project,” said Senior Manager Communication and Relation of Inpex Usman Slamet, Wednesday (23/11).

Moreover, Inpex claimed to hold intensive meetings twice a week with the Government of Indonesia. "We are optimistic that the project will be a positive way for our talks, we want fast and we believe that the government will fully support this project," said Senior Manager of Communication anInd Relations Inpex Usman Slamet, Wednesday (23/11).

Similarly, Shell Indonesia also will not sell its participation right in Masela Bloc.

“Shell, as well as Inpex, are committing to continue the cooperation with the Indonesian government, in terms of ensuring the investable project to develop Abadi gas field. We also continue the intensive communication (with the government),” said General Manager External Relation Shell Indonesia Haviez Gautama.

On the last Friday, Vice Minister of Energy and Mineral Resources Arcandra Tahar said that the government and Inpex had agreed on several points proposed by Inpex, including increasing the production capacity of the liquefied natural gas (LNG) refinery from 7.5 million metric ton per annum (mtpa) to 9.5 mtpa.

However, the government did not reveal the further progress of the negotiation. “The economical is being reviewed,” said Arcandra on Friday (18/11).

The government estimates that the increases in the production capacity of LNG refinery automatically require additional gas wells. Therefore, the capital expenditure is likely to rise.

(Muhammad Farid/Translator)

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