The discovery of a major new natural gas field in Indonesia may push back the day the country's gas consumption outpaces its production and reduce its reliance on imported liquefied natural gas (LNG), officials and analysts said on Feb. 20.
A consortium led by Spain's Repsol found new gas resources at the Sakakemang block in South Sumatra in Indonesia estimated to contain at least 2 trillion cubic feet, the company said on Feb. 19. Repsol claims the find is among the 10 largest made in the world over the past year.
"We hope early production can start the latest five years from now," Arcandra Tahar, Indonesia's deputy energy minister, told reporters on Feb. 20.
If the new find at the group's Kali Berau Dalam-2 well shows good results, Indonesia may be able to push back the current estimate for when it has a natural gasdeficit, or when consumption is greater than domestic supply, from 2025, Tahar added.
To protect against the looming deficit, Indonesia's state-owned energy company Pertamina recently signed a long-term contract with Anadarko Petroleum Corp to buy 1 mtpa of LNG for 20 years from Mozambique. Anadarko is expected to make a final investment decision this year on the project, which is expected to be operational by 2024.
In the near- to medium-term, the Kali Berau Dalam-2 discovery will partially offset declining output from other domestic Indonesian fields, and reduce the country's reliance on LNG, said Wood Mackenzie's Research Director for Asia Pacific Andrew Harwood.
There is also potential for the volume estimate from the field to increase as appraisal of the find progresses, he added.
"Repsol and Indonesia are likely to want to fast-track the development of the discovery. We think 2024/2025 is a realistic estimate for first production," he said adding that the field could produce around 300 million cubic feet per day of gas for about 15 years.
Repsol operates the well and holds a 45% stake, while Malaysia's Petronas owns 45% and Japan's Mitsui Oil Exploration (Moeco) the remaining 1%.
Recommended Reading
Matador Appoints Paul W. Harvey to Board
2025-01-29 - Harvey holds over 40 years of investment experience and is currently the private wealth adviser at Dallas-based Vaquero Private Wealth.
Hess Midstream Signs Deal to Repurchase $100MM of Class B Units
2025-01-14 - Hess Midstream said the repurchase is expected to result in increased distributable cash flow per Class A share.
EnLink Investors Vote in Favor of ONEOK Buyout
2025-01-30 - Holders of EnLink units voted in favor of ONEOK’s $4.3 billion acquisition of the stock, ONEOK announced Jan. 30.
Dividends Declared Week of Jan. 13
2025-01-17 - With 2024 year-end earnings season underway, here is a compilation of dividends declared from select upstream, midstream and downstream companies.
Independence Contract Drilling Emerges from Chapter 11 Bankruptcy
2025-01-21 - Independence Contract Drilling eliminated more than $197 million of convertible debt in the restructuring process.