Indonesia’s US$21bn Abadi LNG Project Enters Construction as Strategic Gas Investment Advances
Indonesia has moved the US$21 billion Abadi liquefied natural gas (LNG) project into its construction phase, marking a significant milestone for one of the country’s largest planned energy developments and reinforcing its strategy to expand gas capacity, strengthen energy security and attract long-term investment.
Located in the Masela Block in Maluku, eastern Indonesia, the Abadi LNG project is designed to become a major addition to the country’s natural gas infrastructure. According to Indonesia’s Ministry of Energy and Mineral Resources, the development is expected to produce approximately 9.5 million tonnes of LNG annually, around 150 million standard cubic feet of pipeline gas per day, and approximately 35,000 barrels of condensate per day.
The project is being developed by INPEX Masela Ltd., which retains a 65% controlling interest and serves as operator, alongside PT Pertamina Hulu Energi Masela, which holds a 20% stake, and Petronas Masela Sdn. Bhd., which holds a 15% interest.
The move into construction follows a long development process that began with the discovery of the Abadi gas field in 2000. Since then, the project has undergone several stages of review and refinement as Indonesia and its partners assessed the most suitable commercial and technical approach for bringing the resource into production.
The initial development concept was based on a floating LNG facility, before the project was redesigned around an onshore LNG development. Indonesia approved a revised Plan of Development in 2019, establishing the framework for the current project configuration.
Further changes came in 2023, when Shell withdrew from the Abadi LNG project, where it previously held a 35% interest. Following the ownership transition, Pertamina and Petronas joined the development by acquiring 20% and 15% stakes respectively, while INPEX Masela retained its controlling position and continued as operator.
The revised partnership structure was followed by further regulatory progress, with Indonesian authorities approving an updated development plan in December 2023 that incorporated carbon capture and storage (CCS) technology. The inclusion of CCS forms part of the project’s design approach as Indonesia seeks to develop major gas resources while addressing emissions considerations.
President Prabowo Subianto officially marked the start of construction in July through a video conference from the Merdeka Palace. According to the Presidential Secretariat, the President described the milestone as an important step for a strategically significant project that had been under preparation for many years and emphasised the need to accelerate nationally important investments.
Indonesia’s Presidential Communication Office said the Abadi LNG project supports the government’s priorities of strengthening energy resilience, attracting investment and creating economic opportunities in eastern Indonesia. The office highlighted the potential for the development to support employment, infrastructure and wider business activity as the project progresses.
For Indonesia’s energy sector, Abadi represents a major investment in future gas supply and infrastructure. The project is expected to contribute to domestic energy needs while supporting LNG exports and reinforcing Indonesia’s role in regional energy markets.
The start of construction marks the transition of the Abadi LNG project from development planning into execution, placing one of Southeast Asia’s most significant gas investments on a new path toward production.
