Several Companies Eye Gas Downstream Investment in Arun SEZ
The Aceh provincial government has disclosed that several national and foreign companies are beginning to explore gas downstream investment in the Arun Lhokseumawe Special Economic Zone (SEZ). This interest has emerged even though the central government has not yet decided on the development scheme for the Tangkulo Gas Field in the South Andaman Block.
Aceh Provincial Government Spokesperson Nurlis Effendi stated that the regional government is opening the widest possible opportunities for investors wishing to develop gas-based industries in the Arun SEZ. “Downstream processing of oil and gas from the Andaman Block is indeed Governor Mualem’s main agenda. Therefore, all parties must start preparing themselves, especially the Aceh Government,” Nurlis said, quoted from a written statement on Tuesday, 14 July 2026.
According to him, several companies have expressed interest in developing downstream industries utilising gas supply from the Andaman Block. One of them is PT Indoasia Oiltank Terminal, a company engaged in energy and petrochemical infrastructure. The company’s directors met with the Aceh Government on Monday, 13 July 2026, to discuss investment opportunities in the Arun SEZ. During the meeting, Nurlis said that PT Indoasia Oiltank Terminal partnered with the Faculty of Chemical Engineering at Syiah Kuala University (USK), involving three chemical engineering professors. He appreciated the company’s move to involve local universities in the project development plan. Besides Indoasia Oiltank Terminal, Nurlis said the Aceh government has also received investment interest from several other companies.
Additionally, Nurlis mentioned that a company based in Jiangsu Province, China, has expressed interest in developing a liquefied natural gas (LNG) project in the same area. He assessed that the high investment interest is driven by the gas reserve potential in the Andaman region. The initial phase of development will begin through the Tangkulo Gas Field in the South Andaman Working Area, operated by Mubadala Energy. “This project will be the entry point for the start of oil and gas downstream processing in Aceh,” he said.
The Aceh Government is targeting the Arun Lhokseumawe SEZ as the centre for gas downstream industrial development. This target aligns with the 2025-2029 National Medium-Term Development Plan (RPJMN), which designates the development of the Arun SEZ as one of the national strategic projects. The Tangkulo Gas Field is projected to produce approximately 300 million standard cubic feet of gas per day (MMSCFD). Of that amount, around 160 MMSCFD has a sales commitment to PLN through a gas sales agreement. This means there is still approximately 140 MMSCFD that could potentially be utilised as raw material for downstream industries in Aceh. “The potential is still very large to support industrial growth in Aceh,” Nurlis said.
Meanwhile, Aceh Regional Secretary M. Nasir Syamaun said the regional government welcomes any investor wishing to contribute to industrial development in Aceh. “We welcome every potential investor who wants to boost economic growth and create jobs in Aceh,” he stated. However, the realisation of downstream processing still depends on the central government’s decision regarding the Tangkulo Field development scheme. Minister of Energy and Mineral Resources Bahlil Lahadalia said the government has not yet decided whether gas processing will be carried out onshore via an onshore receiving facility (ORF) in the Arun SEZ or remain offshore using a floating production, storage and offloading (FPSO) scheme. According to Bahlil, the decision will be based on the project’s economic feasibility. He explained that building a pipeline from the gas field to the shore requires a large investment, potentially causing the gas price to exceed US$10 per MMBTU and reducing the project’s competitiveness. “We must find a win-win solution. We cannot decide if the investment cost is too high. No business ends in a loss. It must benefit the people of Aceh while providing certainty for investors,” Bahlil said in Banda Aceh on Saturday, 11 July 2026.