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Eni's Indonesia gas project to start up in 2021 under new contract - Mr Tahar

Gasoil News - Published on Thu, 06 Dec 2018

Image Source: Reuters
Reuters reported that energy company Eni aims to start output of natural gas from its offshore Merakes project in Indonesia in 2021, Mr Arcandra Tahar, the country's deputy energy minister said. Initial production at Merakes would be 155 million cubic feet of natural gas per day (mmcfd), rising to a forecast peak output of 391 mmcfd.

A spokesman for Italy's Eni did not immediately respond to a request for comment on the matter. The targets are part of an amended development plan for the East Sepinggan block in the Makassar Strait under a new production sharing contract that is expected to be completed before Dec. 12, he said.

As part of the revision, the contractors have agreed to adopt a gross split scheme, whereby Eni and its partner Pertamina would take 67 percent of crude oil and 72 percent of natural gas production from the project, and the Indonesian government would take the rest.

However, it was not immediately clear what split was set previously. Eni said in April it had obtained approval for plans to pipe natural gas from Merakes to the Bontang liquefied natural gas (LNG) processing facility in East Kalimantan.

Mr Tahar said that the amendment would be first time a conventional cost-recovery production-sharing contract in Indonesia is converted to use the gross split scheme. He said that "By using the gross split scheme, it will be simpler and they don't need a lengthy tender process, so they see it as an opportunity."

Recently, Indonesia adjusted its gross split mechanism for new and expiring oil and gas production sharing contracts, whereby contractors shoulder the cost of exploration and production, rather than being reimbursed by the government.

Source :

Posted By : Joykumar Irom on Thu, 06 Dec 2018
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