JAKARTA, RAKYAT NEWS — The Indonesian Ministry of Energy and Mineral Resources (ESDM) has officially approved the Plant of Development (PoD) for the Geng North, Gehem, and Rapak oil fields. This significant decision was communicated through Ministerial Letter No. T-351/MG.04/MEM.M/2024 in response to SKK Migas’s recommendation on the North Hub Development Project in the Makassar Strait.

Hudi D. Suryodipuro, Head of SKK Migas’s Program and Communication Division, highlighted the rapid approval process, noting that the PoD was greenlit just ten months after the Geng North discovery in October 2023. This development is a crucial milestone for the upstream oil and gas industry and aligns with Indonesia’s energy security goals for 2045.

As a Strategic National Project (PSN), this PoD aims to boost oil and gas production and convert resources into production. SKK Migas has played a key role in expediting the PoD process, supporting President Joko Widodo’s directive to streamline bureaucratic procedures in the upstream sector.

The approved PoD involves a massive investment of approximately USD 17.49 billion (IDR 280 trillion), with additional sunk costs amounting to USD 859 million. The project is expected to generate a total gross revenue of USD 39.46 billion (IDR 631 trillion), with the government’s share projected at USD 12.99 billion (IDR 208 trillion), representing about 31.5% of the total revenue.

The project’s potential is substantial, with high local content levels expected to foster domestic industrial growth. SKK Migas is committed to ensuring efficient cost recovery and maximizing national revenue from this significant investment.

The approval of this PoD marks the beginning of a lengthy process that includes finalizing permits, environmental assessments, and land acquisition. SKK Migas calls for continued support from stakeholders to overcome any challenges and accelerate the project’s development to enhance Indonesia’s energy supply and economic growth. (Uki Ruknuddin)