First Steel Cutting for FPSO BHL Commences, Onstream Target Set for Q4 2028

The first steel cutting for the Floating Production, Storage and Offloading (FPSO) Bahtera Haluan Lestari (BHL) officially commenced on Thursday (23/7/2026). This milestone marks the start of fabrication for the FPSO’s main structure, which will be part of the North Hub Development Project in the Makassar Strait, with a target to begin operations (onstream) in the fourth quarter of 2028. Head of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) Djoko Siswanto stated that the start of fabrication indicates the project has entered the construction phase after completing the main engineering stages. The North Hub is an integrated development project for the Geng North and Gehem fields in the Kutai Basin, offshore East Kalimantan, which is targeted to become one of the mainstays of national gas supply. “Today we record another important milestone, namely the first steel cutting for the topside of the FPSO Bahtera Haluan Lestari. This activity marks the start of the fabrication process for the FPSO’s main structure and shows that the main engineering stages have progressed to allow the construction phase to begin,” Djoko said in the Riau Islands. He explained that the North Hub is one of the national strategic projects with an investment value of around US$15 billion. The project includes the construction of 16 development wells, a subsea production system, the FPSO, an offshore condensate offloading system, a 32-inch diameter gas export pipeline, and a gas receiving facility at the Santan Terminal. The FPSO being built has a gas processing capacity of 1 billion cubic feet per day, condensate processing capacity of 80,000 barrels per day, and a storage capacity of up to 1.4 million barrels. Djoko said the North Hub project continues to show progress according to its stages. Following the gas reserve discovery, the project successfully completed the Plan of Development (POD) in 2024, Front End Engineering Design (FEED) in 2025, and the Final Investment Decision (FID) in March 2026 before entering the FPSO fabrication stage this year. Searah North Ganal Chief Executive Officer Mirko Araldi said the Kutai North FPSO is targeted to start production in 2028, less than three years after the final investment decision. According to him, the facility will be the largest FPSO in Indonesia and Southeast Asia with a gas processing capacity of 1 BCFD, a length of 350 metres, and a weight of around 147,000 metric tonnes.