DPR Encourages Government To Accelerate The Implementation Of The Eternal Masela Project

Chairman of Commission VII DPR RI Sugeng Suparwoto. (Photo: Special)

JAKARTA - Commission VII DPR RI encourages the government to accelerate the transfer of participation rights or participating interest (PI) Blok Abadi Masela from Shell Overseas Limited.

"The Commission VII DPR RI encourages the Government, in this case the Ministry of Energy and Mineral Resources (ESDM) to accelerate the implementation of the Masela Eternal Block Project, including supporting Oil and Gas Business Entities to be able to buy shares of the Abadi Masela and Shell Overseas Limited participating interest (PI)," said the head of the Sugeng Suparwoto working meeting quoted on Wednesday, June 14.

Commission VII also asked the Oil and Gas Business Entity to buy shares of the participating interest (PI) Blok Abadi Masela and Shell Overseas Limited.

Sugeng said, the Masela Project is one of the strategic projects because it can produce very large gas production that can be used as a source of community and industrial energy.

"We will become a very large gas producer if this masela project with the Andaman gas has been produced. And this is in accordance with our plan to build gas infrastructure as an energy source as well for the industry," said Sugeng.

Sugeng said that after the Masela project was established on the ground (onshore), if the financial planning increased, one of its participants, Shell, resigned as a 35 percent shareholder.

"The president once mandated Pertamina to participate in it, but of course it must be based on calculations. Given that this masela project is in the deep sea, it must be careful in its calculations. Nationalists are right but we must also be realistic in measuring capabilities," continued Sugeng.

Masela's work area is located in the Arafura Sea (650 km from Maluku Islands and 170 km from the Babar Islands and Tanimbar). The contract was signed on November 16, 1998 and ended in November 2028 (30 years).

WK Masela has received compensation for 7 years and an extension of the contract for 20 years, so the contract will expire on November 15, 2055.

"Current interest holders, Inpex Masela Ltd (65 percent) - Operator, and Shell Upstream Overseas Services Ltd (35 percent). It has been agreed that the LNG refinery will be built on land (Yamdena Island) with a gas production capacity of 9.5 million tons per person (MTPA) or 1,600 million standard cubic feet per day (MMSCFD) and 150 MMSCFD (pipe gas), as well as a condensate of 35.000 barrels of condensate per day (BCPD)," said ESDM Minister Arifin Tasrif in his presentation.

Arifin confirmed what Sugeng said, According to him, the Masela project is one of the major projects that will produce cumulative production (2027-2055) Gas 16.38 trillion standard cubic feet/TSCF (gross) or 12.95 TSCF (sales), and condensate 255.28 million million stock tanks (MMSTB).

"The total reserves proved to reach 18.54 trillion standard cubic feet (tscf) and the required investment reached USD19.8 billion," said Arifin.

Currently, continued Arifin, several technical, environmental and commercial aspects have been completed which include the Original WP&B 2023 approval for project implementation, non-hutan land-area procurement, Marketing Activities, and AMDAL Studies.

Several things will be implemented in 2023: Tender FEED (Offshore LNG, FPSO, SURF, and GEP); and Revision 2 POD-I.

The steps that need to be taken so that the Abadi Masela project can run include revising the 2nd POD I of Abadi Masela Field by including the CCS Scenario (increased investment of USD1.1-1.4 billion).

Inpex joint has submitted a Final Letter of Revision of 2 Field Development Plans 1 (Revision 2 POD I) by entering carbon capture storage (CCS) to SKK Migas on April 4, 2023. And processing Shell's divestment to immediately get a new partner. "The candidate to replace Shell is in the final stage, targeted for completion in June 2023," concluded Arifin.