No Chosen Consultant Yet, Ministry: Masela Block will run as scheduled

KATADATA - Energy and Mineral Resources (EMR) Ministry is still unable to chose which independent consultant to review Masela Block. However, the ministry is still targeting that Masela Block will still run as scheduled, and the plan of development (PoD) will be done by the end of this year. 

EMR oil and gas director general I.G.N. Wiratmadja Puja said that his side is still evaluating which consultant is the best to review Masela Block so that the ministry can get the most accurate production scenario in the oil and gas block; whether to use the floating refinery facility (FLNG) or onshore pipeline scheme.

“Right now for Masela, we’re still evaluating which world-class consultant to review the block. The result will be able to determine which is the best option for Masela LNG Refinery,” Wiratmadja explained in the official EMR Ministry’s website, yesterday. 

The consultant will also study with the same in-depth level for the onshore scheme. It is hoped that the result will be able to settle the polemic that is happening right now about the plan of development for Masela Block.

Even though the government has not appointed the consultant yet, Wiratmadja is certain that the review can be done before the year is over, that the development of the block will run as scheduled.

“Like usual if PoD is submitted to the minister, then he will evaluate it, which can take up to six months,” Wiratmadja said. 

Meanwhile, Fabby Tumiwa, an Executive in Institute for Essential Service Reform, said that the dilemma between onshore or offshore happens because the gas reserve of the block is increasing. “Before, it was decided to use FLNG because back then the reserve was not as big. And now the reserve is larger, so it is considered that pipelines will be more feasible,” Fabby said. 

The government must also make a review in the cost calculation as well as the benefits from the two options. Whichever scheme is to be chosen, it needs to produce a great multiplier effect for the national economy and for the state’s absorption. 

For additional information, right now the gas reserve in Abadi Field, Masela Block, is predicted to reach 10.73 trillion cubic feet (TCF). When the government in 2010 approved the previous PoD, the capacity of the discovered gas reserve in the field was only around 6-9 TCF.

The increase in the reserve is due to the evaluation result on three exploration wells that are drilled in June 2013 and was finished in April 2014. With the discovery of this new gas reserve, Inpex (the operator of the block) has submitted a proposal to increase the capacity of the FLNG from 2.5 million tons per year (MTPA) to become 7.5 MTPA.