JAKARTA Feb 11 Indonesia's state energy
regulator, SKKMigas, has appointed firms for the $4.1 billion
development of Jangrik and North East Jangrik offshore gas and
condensate fields operated by Eni, heralding the
country's first deepwater gas project.
Former OPEC-member Indonesia was once a top global exporter
of natural gas, but a reduction in exploration investment and
ballooning domestic energy demands have seen shipments decline.
However, gas use in Southeast Asia's largest economy has
been limited by a shortage of investment in infrastructure, as
hefty subsidies limit the feasibility of projects to utilise the
In parallel with the project development, 11 development
wells will be drilled, SKKMigas chief Johannes Widjonarko said
in a statement on Tuesday.
"The two fields are expected to commence production in 2017,
reaching a peak output of 450 million cubic feet of gas per day
for six years," Widjonarko said, adding that production from the
fields was expected to continue for a further 14 years.
The project, Indonesia's first gas field development at a
depth below 500 meters, is expected to supply gas to meet the
industrial and energy needs of East Kalimantan, Java and
At this stage 70 percent of gas from the project has been
set aside for export as liquefied natural gas (LNG), but state
regulator SKKMigas hopes this allocation will decline to around
53 percent as more domestic facilities become available.
A consortium - comprising PT Saipem Indonesia, a local unit
of Milan-listed Saipem SpA, Tripatra Engineers and
Constructors, Chiyoda International Indonesia, a unit of
Tokyo-listed Chiyoda Co Ltd, and South Korea-listed
Hyundai Heavy Industries Co - has been appointed to
engineer, procure, construct and install a Floating Production
Unit (FPU) at the site, SKKMigas said.
Meanwhile a consortium of PT Technip Indonesia-Technip
Geoproduction (M) Sdn Bhd, units of Paris listed Technip
, has been appointed to build, procure and install
onshore receiving facilities, pipelines and other supporting
PT FMC Santana Petroleum Equipment Indonesia has been
appointed to engineer and construct underwater prodution,
controlling and supporting facilities for the project.
(Reporting by Fergus Jensen and Wilda Asmarini; Editing by