AsianOil: Indonesia's Masela LNG project future uncertain as hybrid approach is considered

The Indonesian Energy and Mineral Resources Minister, Arifin Tasrif, has ignited speculation surrounding the future of the Masela liquefied natural gas (LNG) project by suggesting a shift toward a hybrid offshore and onshore development system. This change in approach casts doubts on the initial plan of laying a 170-kilometre pipeline across a 3,000-metre-deep undersea trench.

Inpex Corporation, the major Japanese stakeholder, is racing to advance the Abadi LNG plant, which is set to produce 9.5mn tonnes per year (tpy), in the remote Arafura Sea. However, the final investment decision (FID), originally scheduled much earlier, is now anticipated in mid-2026, a delay of at least seven years.

The project, believed to contain 13 trillion cubic feet (368bn cubic metres) of natural gas, gained renewed momentum when Indonesian and Malaysian state oil firms Pertamina and Petronas joined forces to acquire a 35% stake. This had previously been held by Royal Dutch Shell, a pioneer in floating LNG technology.

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