PGN said in a statement that this exploration is carried out to follow up on the potential utilization of natural gas from the Andaman block, which was formalized through the signing of a memorandum of understanding between PGN and Mubadala Energy on July 2.
With an 80 percent working interest in South Andaman, Mubadala Energy is the largest net acreage holder in the area.
The block contains two gas discoveries, Tangkulo-1 and Layaran-1.
PGN said that the supply of gas from Andaman can boost domestic energy resilience, in line with the increasing demand for natural gas in the country.
Previously, the two firms had also signed a memorandum of understanding in October 2024 to conduct a special study on the Arun refinery and the regasification terminal aimed at supporting upstream oil and gas activities.
With a significant production prospect, South Andaman is expected to meet the demand for natural gas in various sectors.
In the future, the supply source from Andaman is expected to be utilized by PGN to meet the demand in the Sumatra to Java region after the DuriDumai-Medan pipeline is constructed, PGN said.
Additionally, it can also be developed in the form of LNG to meet the needs in all areas of PGN’s operational regions, the company said.
PGN’s LNG business
Earlier this year, PGN signed a deal with regional-owned enterprise BUMD for supplies from the BP-operated Tangguh LNG facility in West Papua.
In October 2023, BP shipped the first LNG cargo produced by the new third liquefaction train at the Tangguh LNG facility.
The start-up of Tangguh Train 3 added 3.8 million tonnes per annum (mtpa) of LNG production capacity to the existing two-train facility, bringing total plant capacity to 11.4 mtpa.
Last year, PGN also signed a deal to buy LNG from compatriot producer Donggi-Senoro LNG.
PGN operates the Lampung FSRU terminal and last year it resolved its dispute with Norwegian FSRU player Hoegh Eviover issues related to the FSRU charter.
The 2014-built 170,132-cbm FSRU serves a 20-year charter deal with PGN LNG, a unit of PGN, off the southeast coast of Sumatra in Indonesia.
The regasified LNG from the FSRU-based facility goes for power generation and industrial users in West Java.
