- BP and partners will invest $7 billion in Indonesia’s Papua region in a carbon capture and gas field development project. Production is set to begin in 2028.
- The project will unlock 3 trillion cubic feet of gas and utilise carbon capture to sequester up to 15 million tonnes of CO2.
- The investment is part of a broader $8.5 billion commitment by British companies in Indonesia’s energy, infrastructure, education, and healthcare sectors.
Project in Indonesia’s Papua region. The announcement came Thursday, November 21, during a meeting with Indonesian Defense Minister Prabowo Subianto, who is in London for an official visit.
The project will focus on the Ubadari gas field, and production is set to begin in 2028. BP will process gas from the field at its existing Tangguh liquefied natural gas (LNG) facility in West Papua. The company also plans to use carbon dioxide from its first carbon capture, utilisation, and storage (CCUS) project in Indonesia to increase production at the Tangguh facility.
BP stated that the CCUS project could sequester up to 15 million tonnes of CO2 from the Tangguh plant’s emissions during its initial phase. This move aligns with BP’s strategy to reduce its carbon footprint while expanding natural gas production.
Minister Prabowo highlighted the broader investment commitment, noting that British companies, including BP, have pledged $8.5 billion for projects in Indonesia. These investments will target energy transition, infrastructure, education, and healthcare sectors, signalling strong confidence in Indonesia’s economic future.
The Ubadari project falls under the Tangguh Production Sharing Contract. BP holds a 40.2% stake in the venture. Other partners in the project include China’s CNOOC, Japan’s Mitsubishi Corp, Inpex Corp, and Japan Oil, Gas and Metals National Corp. Indonesia’s oil and gas regulator approved the project in 2021.
The development comes as global energy companies focus increasingly on carbon capture technologies as part of their transition to greener energy sources. With its vast natural gas resources, Indonesia offers BP and its partners a pivotal opportunity to tap into the growing demand for LNG and the push for carbon mitigation.
The Ubadari project will unlock 3 trillion cubic feet of additional gas resources. This could significantly increase Indonesia’s LNG production capacity and strengthen the country’s position in the global energy market.
Indonesia has pushed to increase its natural gas production, which is critical to its energy transition. The country aims to balance energy security with its commitment to reducing greenhouse gas emissions. Carbon capture projects like the one at Tangguh contribute to Indonesia’s strategy to reduce its environmental impact while meeting energy demand.
BP’s investment reflects a broader energy partnership between Indonesia and international firms. This collaboration shows the country’s favourable business environment, boosting its energy sector while addressing climate change.
BP’s partners in the Tangguh project, including CNOOC and Mitsubishi, will play critical roles in developing and operating the Ubadari gas field. Together, they will enhance the facility’s capacity and support Indonesia’s energy transition goals.
With production set to start in 2028, the Ubadari field and carbon capture project represent a significant step forward in both BP’s business strategy and Indonesia’s energy ambitions.