Eni has started gas production from the Merakes Project, located in the East Sepinggan block in the Makassar Strait, deep offshore East Kalimantan, Indonesia.
The Project is a deep-water gas field development at offshore Kutei Basin, with approximately 1,500 meters water depth. The five deep-water subsea wells will guarantee a production capacity of 450 million standard cubic feet per day (MMSCFD), equivalent to 85,000 barrels of oil equivalent per day (BOED). The field has been connected to the Jangkrik Floating Production Unit (FPU), operated by Eni, at 45 km from Merakes field, taking advantage of the synergy and optimizing its producing capacity up to 750 MMSCFD together with the gas flowing from the Jangkrik gas field. The gas produced from Merakes is exported through subsea pipelines to the Jangkrik FPU. After being processed, the gas is exported to the Onshore Receiving Facility (ORF) in Senipah via the existing Jangkrik export pipelines.
Merakes gas will be partially sold to the domestic market and will also contribute to the extension of the life of the Bontang LNG facility, one of the most reliable LNG processing plants in the world, that supplies LNG to both the domestic and export markets.
“We are really proud of the start-up of Merakes, a project which is synergetic with existing operated facilities and is the result of the fruitful collaboration with our partners and with the Indonesian authorities. Merakes is one of Eni key projects in 2021. It will support the growth of gas production, in line with Eni strategic goals,” Eni’s CEO Claudio Descalzi said.
“We are proud to partner with Eni on this strategic development which will help meet growing domestic energy demand in Indonesia and support the country’s export market. Indonesia provides Neptune Energy with strong opportunities for growth and we look forward to building on our relationship with Eni and our partners in the region. We have identified significant exploration potential in our acreage in the Kutei Basin, which offers considerable growth potential through tie-back and standalone developments,” Neptune Energy’s Managing Director in Indonesia, Eko Lumadyo, added.
Eni is the operator of East Sepinggan block with an 65% share ownership through its affiliate, Eni East Sepinggan Ltd.; the other partners are Neptune Energy East Sepinggan B.V. with 20% share and PT Pertamina Hulu Energi with the remaining 15% share. On 11 December 2018, the production sharing contract scheme for the East Sepinggan block was changed into Gross Split PSC to support the efficiency of oil and gas investment in Indonesia.
Eni has been operating in Indonesia since 2001, where has a large portfolio of assets in exploration, production and development.
East Sepinggan PSC
In 2019, Neptune acquired a 20% interest in the East Sepinggan PSC from Eni. The company also has a 30% stake in the West Ganal block. The Jangkrik FPU is positioned as a key Hub in the Kutei Basin, providing future growth opportunities through lower-cost tie-back developments for several existing discoveries in our acreage including Maha and Merakes East. An appraisal well at Maha is currently drilling.
Merakes is Neptune Energy’s largest project development in 2021, adding approximately 11,000 barrels of oil equivalent per day (kboepd), and its second major development to be successfully delivered this year, following start-up of its operated Gjøa P1 development offshore Norway. The development marks an important milestone in the company’s progress towards achieving Group production of around 200 kboepd in 2023 and underlines the importance of Neptune’s Asia Pacific portfolio.
Eni, with 65% participating interest, will continue to be the Operator of the area, which is located in the East Sepinggan area, offshore East Kalimantan in Indonesia, and includes the Merakes development and Merakes East discovery.
The Merakes development project, in the East Sepinggan area, consists in the drilling and construction of subsea wells with a dedicated transportation system in 1500m water depth and connected to the Jangkrik Floating Production Unit (FPU), located 35 km North East.
The gas production 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 will also contribute to the life extension of the plant.