Japan’s INPEX Corporation (TYO: 1605) said it has submitted a revised Plan of Development (POD) for the Abadi liquefied natural gas (LNG) project in Indonesia, incorporating a carbon capture and storage (CCS) component.
The PDO was submitted to the Indonesian authorities through the subsidiary INPEX Masela, Ltd. on behalf of a joint venture of INPEX with British major Shell plc (LON: SHEL).
The move is part of the long-term strategy INPEX Vision @2022, announced in February 2022, aimed at helping achieve a net zero carbon society by 2050.
The revised POD includes plans to implement CCS to neutralize all carbon dioxide (CO2) emissions from gas production at the Abadi field.
Last month, Indonesia’s Ministry of Energy and Mineral Resources enacted a regulation on carbon capture, utilization, and storage (CCS/CCUS) in the oil and gas industry.
The Abadi project is set to become the first CCS project to be carried out as a cost recovery business based on the production sharing contract (PSC) framework governing upstream oil and gas projects in Indonesia, INPEX said.
The Japanese major plans to gradually resume activities related to the project, including some on-site activities, and prepare to start with the front end engineering design (FEED) subject to approval of the revised POD by the authorities.
The aim is to reach a final investment decision (FID) for the project in the second half of the 2020s and begin production in the early 2030s.
LNG production from the Abadi field is expected to reach 9.5 million tons a year, which is more than 10% of Japan’s annual LNG imports, according to INPEX.
The project is expected to help improve energy security in Indonesia, Japan, and other Asian countries, and contribute significantly to Indonesia’s economic development and its net zero ambitions by 2060.
Subject to approval and development, the Abadi field will become INPEX’s second self-operated, large-scale natural gas development project after the Ichthys project in Australia.