Japan's Inpex on Thursday launched construction of its long-delayed $21 billion Abadi LNG project in Indonesia's Masela gas block, in a ceremony that was livestreamed.
Production from the plant is expected to start around 2030.
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The Abadi LNG project will include an LNG plant with annual capacity of 9.5 million metric tons, and a gas pipeline facility with capacity of 150 million cubic feet per day.
Indonesian President Prabowo Subianto, who took part in the groundbreaking ceremony remotely from Jakarta, stressed the importance of energy security and said he expected the project to be delivered as soon as possible.
Takayuki Ueda, chief executive of Inpex, said at the ceremony that Abadi is "an extremely important project that contribute to energy security in Japan and across the Indo-Pacific region."
Inpex's discovery of gas in the Masela block was first announced in 2000, but the development of the project has been delayed due to a number of factors, including a request for change in designs by a previous government, the pandemic and a plan to incorporate a carbon-capture facility.
Inpex aims to start production in early 2030, although the government has been asking for an earlier delivery date.
Energy Minister Bahlil Lahadalia said at the ceremony that construction of the wells and supporting facilities, such as terminals and jetty, will be done simultaneously.
Bahlil added at least 60% of the gas output from the project is expected to be supplied domestically.
A number of buyers have signed initial agreements to buy gas from Masela, including one by a unit of Indonesian state utility PLN to buy 37.5 million tons of LNG over 15 years.
(Reuters - Reporting by Fransiska Nangoy; Editing by John Mair)
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