Ambon, Maluku (ANTARA News) - The location of the Masela liquefied natural gas (LNG) plant will be in the sub-district of South Tanimbar, West Southeast Maluku District Head Petrus Fatlolon has said.

The government through the Energy and Mineral Resources (ESDM) Ministry has determined that the project would be built on shore instead of offshore and the location would the sub-district of South Tanimbar, Petrus said in Saumlaki on Friday.

He said he had received a letter from the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas) asking the district administration to prepare 600 hectares of land in South Tanimbar.

"Currently I could not yet announce the precise spot for the location to prevent land owners from taking advantage by raising their land price," he said.

He said the administration is also asked to prepare trained workers to be employed at the LNG by sending senior high school graduates to proceed studies at the Cepu oil and gas academy in Java.

He said a number of local senior high school graduates were already sent to Cepu since 2016.

"Currently there are around 60 students from Tanimbar studying at the academy. We prepare trained human resources to be more competitive that we would not be mere on-lookers in our resources development," he said.

He said plan has been in process to establish a BUMD, a company-owned by the district administration, Tanimbar Energi, to take a certain share in the project

He said he had coordinated with the holder of the Masela Block production sharing contract Inpex Corporation and the SKK Migas, to involve other local contractors.

"We hope that not only BUMN and banks but BUMD would also be involved in the management of the Masela Block," he said.

Inpex and Royal Dutch Shell have kicked off the preliminary front-end engineering design (pre-FEED) for the development of an onshore liquefied natural gas (LNG) plant at the Masela block in Arafura Sea, which is expected to come on stream by 2027.

The LNG plant will have a capacity of 9.5 million tons annually (mtpa) and 150 million standard cubic feet per day (mmscfd) of gas, according to the SKK Migas.

Inpex and Shell, which currently hold respective stakes of 65 and 35 percent in Masela, will see their contract at the block expire in 2028. The government, however, promised to give them a 20-year extension.

Masela is estimated to be able to produce 1,200 mmscfd of gas and 24,000 barrels of condensate per day for 24 years.

Reporting by Penina Fiolana Mayaut, A Saragih

Reporter: Antara
Editor: Fardah Assegaf
Copyright © ANTARA 2018