Eni Declares 'Giant' Gas Discovery offshore Indonesia

Eni SpA announced Monday a "giant" natural gas discovery in the Ganal block in the Kutei basin offshore Indonesia.

"Preliminary estimates indicate in-place resources of approximately 5 trillion cubic feet (Tcf) of gas and 300 million barrels of condensate in the encountered interval", the Italian state-controlled energy major said in an online statement.

"Analyses are ongoing to evaluate accelerated development options, also considering the proximity to existing and planned infrastructures, which offer potential synergies in terms of time‑to‑market and cost optimization", Eni added.

"The new discovery is adjacent to the not-yet-developed Gula gas discovery (2 Tcf of gas in place with 75 million barrels of condensate). Initial assessments indicate that the combined Geliga and Gula resources have the capacity to produce an additional 1 Bscfd [billion standard cubic feet a day] of gas and 80,000 bpd [barrels per day] of condensate, opening the possibility - among others - of establishing, in a fast-track mode, a third production hub in the prolific Kutei Basin by mirroring the development concept of the ongoing North Hub project.

"Studies are also underway to evaluate a further rejuvenation of Bontang by resuming additional liquefaction capacity beyond what is already planned for the North Hub development, thus further extending the plant’s operational life".

Drilled to a total depth of about 5,100 meters (16,732.28 feet), the discovery in the Geliga-1 well showed a gas column with "excellent petrophysical properties" in the Miocene interval, according to Eni. The drilling site had a water depth of around 2,000 meters off the coast of East Kalimantan province on Indonesia's side of Borneo island, it said.

The discovery is among five exploration wells drilled by Eni over the past six months. "The exploration campaign will continue with one additional well planned in 2026 and two further wells in 2027", the statement said.

Eni operates the Ganal production sharing contract (PSC) with an 82 percent stake. China Petroleum & Chemical Corp owns 18 percent.

Petronas JV

Ganal is part of blocks Eni agreed last year to contribute to its pending joint venture with Malaysia's Petroliam Nasional Bhd (Petronas) in Indonesia and Malaysia.

The independent joint venture, called Searah, will focus on gas-producing and development assets. The combination would create a "major" LNG player in the Asian market, according to the partners.

"Closing of the transaction is expected within Q2 2026", Monday's statement said. "The valorization to a third party of a 10 percent stake in the Eni Indonesia portfolio withheld from the Searah transaction is underway and expected to be concluded in 2026. The Geliga discovery adds to the value of this sale".

New Production Hubs

Earlier in 2026 Eni made final investment decisions to proceed with the Gendalo and Gandang gas project (South Hub) and Geng North and Gehem fields (North Hub) in the Kutei basin.

Expected to go online 2028, the projects are designed to add up to 2 Bcfd of gas and 90,000 bpd of condensate to Eni's production capacity, it said in a press release March 18. Eni expects to reach peak production at the new projects 2029.

"The Gendalo and Gandang development plan, in water depths ranging from 1,000-1,800 meters, includes the drilling of seven producing wells and the installation of deepwater subsea production systems tied back to Jangkrik FPU [floating production unit]", Eni said.

"For the North Hub, the project foresees the drilling of 16 producing wells at water depths between 1,700 and 2,000 meters, and the installation of subsea systems linked to a newly built FPSO [floating production, storage and offloading vessel] capable of processing over 1 Bscfd of gas and 90,000 bpd of condensate, with a storage capacity of 1.4 million barrels.

"The combined volumes in place for the two projects amount to nearly 10 Tcf of gas initially in place, with 550 million barrels of associated condensate".

The gas will be transported via pipeline to a receiving facility feeding an existing pipeline network and the Bontang liquefaction plant. The liquefied natural gas (LNG) produced will be delivered to both the domestic and overseas markets. The condensate will be processed and stored offshore in the FPSO for export via a shuttle tanker, Eni said.

"The development plan also includes extending the operating life of the Bontang LNG plant by reactivating one of its currently idle liquefaction trains (Train F)", it added.

"These projects reaffirm Eni's long-term commitment to Indonesia’s growing offshore gas sector, enhancing gas supply while maximizing synergies with existing infrastructure in East Kalimantan and the involvement of significant local content.

"In particular, the development of Geng North and Gehem will establish a new production hub in the northern Kutei Basin, creating additional tie-back opportunities for future discoveries".

Authorities in the Southeast Asian country approved Eni's development plans for the projects 2024. Eni at the time also secured a 20-year extension to the Indonesia Deepwater Development gas project, which consists of the Ganal and Rapak blocks, as announced by the company August 23, 2024.

Eni discovered Geng North about three years ago under the North Ganal production sharing contract (PSC), as announced by the company October 2, 2023.

Gehem came under Eni when it acquired Chevron Corp's operating stake in the Rapak PSC, as well as the Ganal and Makassar Straits PSCs, in 2023.

To contact the author, email jov.onsat@rigzone.com