TANIMBAR ISLANDS, INDONESIA / RankWire.AI / – The Abadi Masela LNG project in Indonesia is projected to generate approximately $37.8 billion in direct revenue for the government. Additionally, Energy and Mineral Resources Minister Bahlil Lahadalia estimated that $6.43 billion could be collected through indirect taxes. These figures were announced following a groundbreaking event held on July 16 in Maluku. Officials characterized the ceremony as the commencement of physical construction for the $20.9 billion national strategic initiative. President Prabowo Subianto participated remotely from Jakarta to observe the event.
The government estimates that peak construction activity may create employment for over 12,000 individuals. Of these jobs, 30% are planned to be allocated to residents of Maluku and the Tanimbar Islands. Once operational, the project could employ between 800 and 1,000 workers. Authorities also forecast that the project will contribute $137.8 billion to Indonesia’s gross domestic product, with Maluku benefiting from $95 billion and the Tanimbar Islands from $92 billion in economic gains.
The Abadi gas deposit is situated roughly 180 kilometers offshore of Yamdena Island in the Arafura Sea, with water depths ranging from 400 to 800 meters. Development plans include subsea production infrastructure, an offshore processing vessel, a 175-kilometer pipeline, and an onshore LNG processing facility. The project also features carbon capture and storage systems. Expected production capacity is 9.5 million tonnes of LNG annually, along with up to 35,000 barrels of condensate each day.
Domestic gas share underpins project planning
The Ministry of Energy mandates that at least 60% of the gas produced from Masela be allocated for Indonesia’s internal market, with no more than 40% designated for export. The domestic portion aims to support fertilizer manufacturing, electricity generation, and downstream industries. Potential users identified by the government include Pupuk Indonesia, PLN, and PGN. The approved development plan also allocates 150 million standard cubic feet of pipeline gas daily, with the domestic gas share incorporated into the formal project development framework.
INPEX owns a 65% stake and is the operator of the Abadi Masela LNG project. Pertamina holds a 20% interest, while Petronas owns the remaining 15%. The production-sharing agreement is valid until November 15, 2055. INPEX discovered the Abadi field in 2000, and Indonesia approved an onshore development plan in 2019. A revised plan featuring carbon storage was authorized in 2023. Engineering work for front-end development began in 2025, with a final investment decision targeted by the end of 2027.
Preparations continue ahead of investment decision
Following more than twenty years of planning post-discovery, the groundbreaking marked a significant milestone. Indonesian officials described it as the official start of physical construction activities. Meanwhile, INPEX persists with engineering efforts related to the offshore vessel, subsea systems, export pipeline, and onshore LNG plant. Two separate consortia are conducting simultaneous design work for the offshore vessel and the LNG facility. INPEX states that this process will facilitate contractor selection ahead of the final investment decision. Production is expected to commence in the early 2030s.
A 10% participating interest has been set aside for a company owned by Maluku Province. The field is located more than 12 nautical miles from the nearest island. The project framework also encompasses revenue-sharing arrangements for oil and gas with the province. The Ministry of Energy indicates that development could bolster local businesses, infrastructure, and workforce training initiatives. Studies cited by the ministry project peak construction employment exceeding 12,000 jobs. Indonesia’s fiscal outlook remains based on government estimates as project preparations move forward.