Italian Oil Giant Eni Finalises Major Gas Project Investment in East Kalimantan
Global energy company Eni has officially reached a Final Investment Decision (FID) for the development of the Gendalo–Gandang (South Hub) and Geng North–Gehem (North Hub) gas projects offshore East Kalimantan. This investment decision comes 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 projects will utilise deep-sea production technology and existing infrastructure, including the Jangkrik FPU and the reactivation of the Train F facility at the Bontang LNG Plant, to enhance cost efficiency and accelerate gas commercialisation. The Gendalo and Gandang development will involve drilling seven production wells at depths of 1,000–1,800 metres, connected to the Jangkrik facility. Meanwhile, the North Hub project includes drilling 16 production wells at depths of 1,700–2,000 metres, which will be linked to a new FPSO with a processing capacity of over 1 billion cubic feet of gas per day and 90,000 barrels of condensate per day.
Overall, these two projects hold a potential resource of approximately 10 trillion cubic feet (TCF) of gas and 550 million barrels of condensate. Production 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 onshore to supply the domestic pipeline network and support LNG production at the Bontang facility for both domestic and export markets. Condensate will be processed and stored at the offshore FPSO facility before being transported via tankers.
This investment decision is a significant milestone in the development of Indonesia’s deep-sea gas and strengthens the partnership between Eni and the Indonesian Government. The significant volume of gas and LNG from this project will support Indonesia’s long-term energy security.
The Head of SKK Migas, Djoko Siswanto, welcomed the investment decision, stating that the FID serves as a strong signal of global investor confidence in Indonesia’s upstream oil and gas investment climate. “This investment decision is an important step in supporting the increase of national gas production while strengthening Indonesia’s energy security. SKK Migas, together with the government, will continue to push for the accelerated development of strategic projects like this to provide maximum benefits to the country and society, as well as to enhance economic growth,” he added.
With an investment value exceeding US$15 billion, Eni is simultaneously conducting procurement tenders for goods and services and has already purchased Long Lead Items (LLI). The Managing Director of Eni Indonesia has reported this FID announcement to the Minister of Energy and Mineral Resources, noted Djoko.
The investment is expected to create a multiplier effect, particularly regarding employment, with estimates suggesting it could employ thousands of people. Furthermore, this project will be part of the assets merged in a business collaboration between Eni and the Malaysian energy company Petronas to form a new company (NewCo), which aims to achieve a production of over 500,000 barrels of oil equivalent per day by 2029. Eni has operated in Indonesia since 2001 and remains a key gas producer in the Kutai Basin of the Makassar Strait, a region currently evolving into a strategic Indonesian gas production hub.