Hashim Undertakes Giant Natuna Gas Block Development Despite High CO2 Content
The Ministry of Energy and Mineral Resources (ESDM) has addressed the acquisition of the Natuna D-Alpha oil and gas working area (WK) by PT Nations Petroleum, a subsidiary of the Arsari Group. The company, owned by Hashim Djojohadikusumo, secured the Natuna D-Alpha working area through a direct tender process.
This decision is part of the results from the auction of six oil and gas working areas announced by the government via the Decree of the Minister of ESDM No. 108.K/MG.4/DJM/2026, dated 17 September 2026. Overall, these six working areas carry a total certain commitment for the first three years valued at US$141.512 million, along with a signing bonus of US$1.6 million.
The auction results mark a new chapter in the management of the giant Natuna D-Alpha gas field, which has remained stagnant for over 50 years since its discovery in 1973. The region is noted for its immense hydrocarbon potential, with estimated gas resources exceeding 200 trillion cubic feet (TCF). However, development challenges are high due to carbon dioxide (CO2) content reaching over 70%.
Responding to this, the Director General of Oil and Gas at the Ministry of ESDM, Laode Sulaeman, emphasised that current technological advancements have successfully improved the efficiency of gas projects previously deemed uneconomical. One of the primary reasons for the project’s previous lack of economic viability was the high CO2 content.
“Technology has now advanced, so things that were previously felt to be uneconomical are now more economically viable,” stated Laode during an event in Jakarta on Monday (21/9/2026).
He noted that the use of the latest technology allows for more varied scales of gas processing facilities, such as the introduction of mini LNG facilities with a capacity of 2 MMSCFD, compared to the previous standard of 100 MMSCFD. This change in scale enhances the economic feasibility of gas field development.
Regarding the operation of the Natuna D-Alpha working area, the government anticipates that the project development scheme will not operate in isolation but through a partnership scheme with other partners. “Cooperation patterns certainly exist; usually, in previous cases, there has always been cooperation,” he concluded.
History of Natuna D-Alpha
The Natuna D-Alpha working area has a long history in the effort to develop Indonesia’s massive oil and gas reserves. Located offshore the Natuna Islands in Riau Islands Province, the block has undergone numerous changes in operators and management schemes before being re-offered to investors by the government.
The development history of Natuna D-Alpha began in 1973 when the Italian operator AGIP discovered gas in the AL Field, later known as Natuna D-Alpha. The area is said to possess vast hydrocarbon potential, with estimated gas resources of over 200 trillion cubic feet (TCF).
This potential subsequently attracted ExxonMobil, which gained management rights for the Natuna D-Alpha area in 1980. 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 terminated ExxonMobil’s contract in 2007. In 2008, the government handed the management of Natuna D-Alpha to PT Pertamina (Persero).
Pertamina subsequently 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 (or Natuna Timur). Later, Petronas joined the consortium, but was eventually replaced by the Thai oil company, PTT Exploration and Production (PTT EP), in 2012.
Despite involving major global oil companies, the development of East Natuna reached another impasse. The consortium formed to develop the field eventually dissolved in 2017. Following the dissolution, the government reassigned Pertamina to continue the development efforts of East Natuna. However, commercial development failed to materialise.
Ultimately, in 2022, Pertamina returned the management of the East Natuna project to the government. The return was prompted by the assessment that the project required 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 oil and gas potential in the East Natuna region to investors. The government split the Natuna Block into three working areas: Arwana-Baruna, Natuna D-Alpha, and Paus. This division is part of the government’s strategy to re-attract investor interest to the region, which possesses jumbo oil and 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 tender mechanism. “In mid-May, during the IPA (Indonesian Petroleum Association) Conference & Exhibition, we announced that this would be very good; we need to first gauge interest in Natuna,” Tutuka said during a press conference.