Energy Ministry to socialise benefits of Andaman Block gas development

The Ministry of Energy and Mineral Resources (ESDM) is designing a socialisation campaign on the benefits of developing the Andaman Block gas field, with advantages for the people of Aceh as a key priority. Director General of Oil and Gas at the ESDM Ministry, Laode Sulaeman, stated after attending the opening of the Global Hydrogen Ecosystem Summit & Exhibition 2026 in Jakarta on Tuesday that the ministry wants to create effective outreach steps so that the Acehnese people understand that the Andaman block’s presence is a priority for them. Laode said the government is currently seeking a middle ground or win-win solution for the development of the Andaman Block gas. He clarified that this middle ground involves reconciling the government’s plans, the business entities, and the cooperation contract contractors (KKKS) as signed in the Plan of Development (POD), with the community’s desire to optimise the benefits of the Andaman Block gas development. ‘There should be no assumption that this gas is being piped to Java. It is not like that,’ Laode said. Furthermore, Laode conveyed that the gas from the Andaman block already has potential buyers, one of which is a state-owned enterprise (BUMN) operating in fertiliser management. ‘There are already buyers. The complete details will be announced later. Yes, a BUMN. One of the candidates is Pupuk Indonesia,’ Laode stated. Mubadala Energy has discovered gas reserves offshore in the Andaman Block. Mubadala Energy’s initial production target is around 300 million standard cubic feet per day (MMSCFD). Regarding this gas discovery, Aceh Governor Muzakir Manaf has written to President Prabowo Subianto and ESDM Minister Bahlil Lahadalia concerning the management of the oil and gas find in the South Andaman Tangkulo Field by Mubadala Energy. Aceh’s request is that the gas not be processed via a Floating Production, Storage, and Offloading (FPSO) scheme offshore, but rather through an onshore receiving facility (ORF) at the Arun Special Economic Zone (KEK) in Lhokseumawe. Additionally, there is a request for the allocation of Mubadala’s gas to be used for industries in Aceh, along with a request for a temporary postponement of the Plan of Development (POD) document. ESDM Minister Bahlil Lahadalia stated that the Aceh government’s request for gas processing at the Arun KEK is still being considered from an economic standpoint. He explained that gas management ultimately comes down to business, meaning that if the economic calculations are viable, Aceh’s request can be considered. However, if the economics are too challenging, it may be difficult to force. Bahlil explained that the gas discovery by Mubadala is located beyond the 12-nautical-mile limit, and building a pipeline would require significant investment, ultimately resulting in a gas price of up to 10 US dollars per MMBTU.