JAKARTA Japanese oil and gas firm Inpex Corp will delay sanctioning its Masela Abadi liquefied natural gas (LNG) project in Indonesia by at least two years, the Indonesian energy regulator said in a written statement on Wednesday.
As a result of the delays to a government decision on whether the project should go ahead as an offshore facility or be moved onshore, the company plans to reduce its Indonesian workforce by at least 40 percent, said Amien Sunaryadi, chairman of the regulator, SKK Migas.
The pace of development of giant gas export schemes has slowed globally as liquefied natural gas prices have plummeted with oil prices, prompting many companies to delay funding decisions until business conditions brighten.
The planned 7.5 million-tonne-per year Abadi Floating LNG plant, jointly developed by Royal Dutch Shell, would be the largest of its kind in the world with an estimated price-tag of over $14 billion.
"We are still waiting for a government decision on the revision of the plan of development, and hope there will be a decision as soon as possible," Usman Slamet, senior communication manager at Inpex Indonesia said.
Once a decision is made Inpex will continue with Front End Engineering Design on the project, while staffing levels will be adjusted in line with the company's workload, he added.
(Reporting by Wilda Asmarini, Writing by Fergus Jensen and Oleg Vukmanovic, editing by Louise Heavens and David Evans)
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Updated Date: Mar 17, 2016 00:00 AM