Mubadala Energy has entered into a preliminary agreement with the state-owned company Pupuk Indonesia for the supply of natural gas, Reuters reported on May 20. The agreement includes the delivery of 115 million standard cubic feet per day (mmscf/d) to a methanol plant and 85 mmscf/d to an ammonia facility.
The total volume of 200 mmscf/d will be supplied once operations begin at the South Andaman block, with first production expected by the end of 2028, said Paul Slinger, Head of Communications at Mubadala Energy. He spoke on the sidelines of a conference hosted by the Indonesia Petroleum Association.
Start-up linked to Tangkulo-1 production
The agreement between the two companies remains preliminary and is contingent on the success of drilling operations at the Tangkulo-1 well, currently under development. This well marks the first phase of exploitation of the South Andaman block, located offshore Indonesia.
Mubadala Energy disclosed last year that the well could hold more than 2 trillion cubic feet (tcf) of gas in place. This estimate was shared following an exploration campaign launched in 2024.
Major discovery in the Layaran block
Prior to Tangkulo-1, the Emirati group announced another discovery at the Layaran-1 well, located in the same area. That site is estimated to contain more than 6 tcf of gas in place, based on early assessments. Combined, these volumes make the South Andaman block one of Southeast Asia’s most promising gas reserves, pending confirmation through development drilling.
Mubadala Energy, a subsidiary of Mubadala Investment Company, holds assets in 11 countries. Its portfolio focuses on the Middle East and North Africa, Russia, and Southeast Asia. The company has not disclosed any financial terms related to the agreement with Pupuk Indonesia.
“Supply will begin once commercial production is initiated at the block,” Paul Slinger stated, according to Reuters.
