Done Deal! This Italian Oil Company Officially Invests in Indonesia's Rp254 Trillion Project

Jakarta, CNBC Indonesia - The global energy company from Italy, Eni, has officially made the decision to invest or Final Investment Decision (FID) for the development of a deep-sea gas project in Indonesia, with an estimated investment value of around US15billionorequivalenttoRp254trillion(assuminganexchangerateofRp16, 956/US). The substantial investment will be used to develop two giant projects, namely Gendalo-Gandang (South Hub) and Geng North-Gehem (North Hub), located offshore East Kalimantan. This investment decision was taken just 18 months after the approval of the Plan of Development (POD) in 2024, marking an acceleration in the development of Indonesia’s deep-sea gas projects. The project utilises deep-sea production technology and existing infrastructure, including the Jangkrik FPU and reactivation of Train F at the Bontang LNG Plant facilities, thereby increasing cost efficiency while accelerating gas commercialisation timelines. The development of Gendalo and Gandang will be carried out at sea depths of 1,000-1,800 metres with the drilling of 7 production wells connected to the Jangkrik facilities. Meanwhile, the North Hub project includes drilling 16 production wells at depths of 1,700-2,000 metres, which will be connected to a new FPSO with a processing capacity of more than 1 billion cubic feet of gas per day (BSCFD), as well as 90,000 barrels of condensate per day. Overall, the two projects have potential resources of around 10 trillion cubic feet of gas (TCF) and 550 million barrels of condensate. Production from these gas fields is projected to commence in 2028 and reach its peak in 2029 with a capacity of around 2 billion cubic feet of gas per day and 90,000 barrels of condensate per day. The produced gas will be piped to shore to supply the domestic pipeline network and support LNG production at the Bontang facilities for domestic and export markets. Meanwhile, the condensate will be processed and stored at the offshore FPSO facilities before being transported by tanker ships. This investment decision represents a significant milestone in the development of Indonesia’s deep-sea gas and strengthens the partnership between Eni and the Indonesian Government. The significant volumes of gas and LNG from this project will support Indonesia’s long-term energy security. SKK Migas Head Djoko Siswanto welcomed the investment decision. According to him, the FID of this project serves as a strong signal of global investors’ confidence in the upstream oil and gas investment climate in Indonesia. In addition, this investment decision is an important step in supporting the increase in national gas production while strengthening Indonesia’s energy security. “SKK Migas, together with the government, will continue to encourage the acceleration of strategic projects like this so that they can provide maximum benefits for the country and society as well as boost economic growth,” said Djoko, quoted from a written statement on Wednesday (18/3/2026). With this quite fantastic investment, Eni is concurrently running a tender process for goods and services procurement, and has already purchased Long Lead Items (LLI). “Yesterday, the Managing Director of Eni Indonesia reported to the Minister of Energy and Mineral Resources about this FID announcement,” said Djoko. Djoko stated that this investment can generate multiplier effects, including related to employment absorption. In addition, this project will also be part of the assets to be merged in a business cooperation between Eni and Malaysia’s energy company Petronas, to form a new company (NewCo) targeted to have production of more than 500,000 barrels of oil equivalent per day in 2029. Eni has been operating in Indonesia since 2001 and is one of the key gas producers in the Kutai Basin in the Makassar Strait, an area now developing as Indonesia’s strategic gas production hub.