Japan's Inpex gets approval for Abadi LNG project

Japanese energy company Inpex Corporation has received approval from the Indonesian government for the revised plan of development (POD) for the Abadi LNG project, it said on December 5. This revised plan marks a step forward for the project, as it incorporates a carbon capture and storage (CCS) component, a first for Indonesia's production sharing contract (PSC) scheme.

Inpex submitted the revised POD in April 2023, aiming to integrate CCS technology into the existing plan. The Indonesian authorities' approval officially greenlights the project's progress with CCS. 

The Abadi LNG project is expected to produce approximately 9.5mn tonnes/year of LNG, equivalent to over 10% of Japan's annual LNG consumption, Inpex said.

Inpex and its partners will now work on revising the PSC to formally include CCS in the project's scope. They will also resume project operations, focusing on FEED (front-end engineering design) work while preparing for marketing and financing activities. The joint venture aims for a final investment decision and production startup upon completing the necessary preparations.

Apart from Inpex, other partners in the project are Pertamina Hulu Energi, a unit of Indonesian state-run Pertamina, and Malaysia's Petronas. Pertamina Hulu and Petronas officially became partners of the project on October 2023, following the completion of the conditions precedent under the sales and purchase agreement on the transfer of Shell’s participating interest.