Hashim-Managed Natuna Gas Block Contains High CO2, Is Development Realistic?
The oil and gas company owned by Hashim Djojohadikusumo, PT Nations Petroleum, has officially been appointed as the winner of the auction for the Natuna D-Alpha Working Area (WK). The announcement of the winner was contained in the Decree of the Minister of Energy and Mineral Resources (ESDM) No. 108.K/MG.4/DJM/2026, dated 17 September 2026.
The company, under the umbrella of the Arsari Group, has made a firm commitment to an investment of US$ 103,309,000 for the first three years and has provided a signature bonus of US$ 200,000.
The Natuna D-Alpha gas block is estimated to possess jumbo gas resources with a potential of up to 200 trillion cubic feet (TCF). However, on the other hand, development challenges are considered high due to carbon dioxide (CO2) content reaching more than 70%.
This raises the question: is the development of the Natuna D-Alpha Gas Block realistic and economical?
The Ministry of Energy and Mineral Resources (ESDM) assesses that current gas processing technology advancements have made the Natuna D-Alpha project, which was previously considered uneconomical, more viable for development. The Director General of Oil and Gas at the Ministry of ESDM, Laode Sulaeman, emphasised that gas processing technology has progressed very rapidly in recent years. He explained that the variety of available gas processing facility scales has increased, allowing for improved project efficiency.
“Technology has advanced now. Because technology has advanced, things that were previously felt to be uneconomical are now more economical,” said La него during a blood donation event on Monday (21/9/2026).
Laode cited as an example that the development of Liquefied Natural Gas (LNG) facilities in the past required large scales of up to 100 MMSCFD. Meanwhile, current technology has enabled the use of mini LNG facilities with capacities starting from just 2 MMSCFD. “For example, in the past, when we talked about LNG, we talked about 100 MMSCFD; now there is mini LNG with only 2 MMSCFD. So, technology is very advanced now,” Laode added.
He noted that in the future, it is possible for PT Nations Petroleum to partner with other oil and gas companies, stating that cooperation patterns are common in such ventures.
The History of Natuna D-Alpha
The Natuna D-Alpha Working Area has a long history in the effort to develop Indonesia’s giant gas reserves. Located offshore the Natuna Islands, Riau Islands Province, the block has undergone several changes in operators and management schemes before being re-offered by the government to investors.
The history of Natuna D-Alpha development began in 1973 when the Italian operator AGIP discovered gas in the AL Field, which later became known as Natuna D-Alpha. The area is said to have massive hydrocarbon potential, with estimated gas resources of over 200 trillion cubic feet (TCF).
This potential subsequently attracted interest from ExxonMobil. In 1980, ExxonMobil was granted management rights for the Natuna D-Alpha area. However, field development faced various challenges due to the high carbon dioxide (CO2) content in the Natuna gas.
After years of failing to achieve commercial development, the government finally terminated ExxonMobil’s contract in 2007. In 2008, the government handed the management of Natuna D-Alpha to PT Pertamina (Persero).
Pertamina then sought partners to develop the giant gas field. In the process, Pertamina collaborated with several international oil companies. ExxonMobil returned alongside Pertamina and Total in an effort to develop Natuna D-Alpha. Consequently, the field was renamed East Natuna. Later, Petronas joined the consortium, but was eventually replaced by the Thai oil company, PPL (PTT Exploration and Production) in 2012.
Despite involving several of the world’s major oil companies, the development of East Natuna stalled again. The consortium formed to develop the field eventually dissolved in 2017. Following the end of the consortium, the government reassigned Pertamina to continue the development efforts of East Natuna. However, commercial development remained unrealised.
Ultimately, in 2022, Pertamina returned the management of the East Natuna project to the government. This return was due to the project being deemed to require massive investment, particularly to handle the high CO2 content.
East Natuna Split into Three Working Areas
After the management of East Natuna was returned to the government, the Ministry of Energy and Mineral Resources (ESDM) prepared a new scheme to re-offer the gas potential in the East Natuna area to investors. The government split the Natuna Block into three working areas: Arwana-Barakuda, Natuna D-Alpha, and Paus. This division is part of the government’s strategy to re-attract investor interest to the area, which possesses jumbo gas resources.
The Director General of Oil and Gas at the Ministry of ESDM at that time, Tutuka Ariadji, stated that the three areas would be offered through an open international auction mechanism. “In mid-May, during the IPA (Indonesian Petroleum Association) Conference & Exhibition, we announced that it would be very good; we need to first find interest in Natuna, and if we announce it, we must know the interest,” Tutuka said during a press conference on Monday (30/1/2023).
On several occasions, Tutuka himself expressed concern that the development of the East Natuna Block had been stalled for decades, despite the block’s massive potential.