Indonesia Forms Consortium to Take Shell Shares in Masela Block

Arfi Bambani
Illustration: Oil and gas well of PT Pertamina Hulu Kalimantan Timur in Sepinggan, Balikpapan
Illustration: Oil and gas well of PT Pertamina Hulu Kalimantan Timur in Sepinggan, Balikpapan - Investment Minister Bahlil Lahadila said the government formed a consortium to take over Shell's 35 percent participating interest in the construction of the Abadi Liquefied Natural Gas (LNG) Project in the Masela Block, Maluku Province.

"I just came back from Saumlaki accompanying the President and we stayed there. The President has given directions, both to me and to the Minister of State Owned Enterprises that the gas program in Maluku is one of the priorities," said Bahlil Lahadalia in a working meeting with Commission VI DPR RI in Jakarta, Thursday, September 8, 2022.

Lahadalia said that Inpex as the majority shareholder must still be asked to quickly carry out the process. Shell controls 35 percent of the participating interest and the remaining 65 percent is controlled by a Japanese company called Inpex Corporation as the operator.

The annexation of Shell's participation rights is carried out through a collaboration between the Indonesia Investment Authority (INA), Pertamina, and several other companies explored by the Minister of SOEs to form a consortium to take over the 35 percent stake.

"Mr. President has also seen the location in Saumlaki. I was also surprised that the roads there were smoother than roads in other places and the airport was also very good," said Bahlil Lahadalia. Saumlaki is proposed to be the center of activities for the LNG exploration and refinery construction.

"So, most likely the debates whether in Saumlaki or elsewhere, the President said that in Saumlaki it is much more qualified and more efficient," he said.

Currently, the progress of the Abadi LNG Plant project in the Masela Block is still experiencing obstacles after Shell Upstream Overseas, an oil and gas company from the Netherlands, left in July 2020. Whereas the construction of the refinery, which is one of the national strategic projects with a value of 19.8 billion US dollars or equivalent to Rp. 285 trillion, is projected to start production in 2027.

Tag # masela block # shell # inpex # pertamina # indonesia oil and gas # indonesia oil and gas reserves

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