Eni will start with the execution of the Merakes Development Project in Indonesia following its approval by the country's energy ministry, and Eni's board, the Italian energy company said Monday.
The gas development project, located in the Kutei Basin offshore East Kalimantan, includes the drilling and construction of subsea wells with a dedicated transportation system in water depth of 1,500-meters, which is connected to the Jangkrik Floating Production Unit (FPU), located 35 km northeast, according to Eni's statement.
Eni's Board of Directors authorized the investment plan for the project a few days after the Indonesian Energy Ministry approved the revised field development plan under the terms of the Gross Split Production Sharing Cost (PSC) scheme, it said.
The gas produced from the field will be shipped to the Bontang LNG plant using also all the other existing facilities of Jangkrik field as well as the East Kalimantan transportation network. This new production is also set to extend the life of the plant.
Eni's CEO Claudio Descalzi said the Merakes Development Project approval was an important step for the company’s strategy in Southeast Asia aimed at increasing both Eni's presence and production through organic growth.
"In order to do so, we will leverage on exploration, which will enable us to increase our reserves first, and then our gas production thanks to the optimization of existing facilities and complying with the strictest time-to-market," he said.
According to the statement, Eni has been operating in Indonesia since 2001 and holds a large portfolio of assets in exploration, production and development.
The company's production activities are located in the Kutei Basin, East Kalimantan, mainly through the Jangkrik field, in the Muara Bakau working area, which delivers production in excess of 650 million standard cubic feet of gas per day.
The Merakes development will strengthen Eni's technological and operations leadership in the development of deep-water gas fields in Indonesia, the statement added.
Eni is the operator of the East Sepinggan Contract Area through its subsidiary Eni East Sepinggan Limited, which holds an 85 percent participating interest while PT Pertamina Hulu Energi East Sepinggan holds the remaining 15 percent.
By Hale Turkes