Mubadala makes gas discovery offshore Indonesia
Abu Dhabi’s Mubadala Energy on December 19 announced a gas discovery in the Layaran-1 exploration well, situated approximately 100 km offshore North Sumatra, Indonesia.
Mubadala, the operator of the South Andaman gross split production sharing contract (PSC), revealed that Layaran-1, the company’s first deep-water well, drilled to a depth of 4,208 m in 1,207 m water depth, has encountered an extensive gas column exceeding 230 m in an Oligocene sandstone reservoir.
“With our strategy to expand our gas portfolio to support the energy transition, this development offers material commercial opportunities and adds momentum to our strategic growth story,” Mansoor Mohamed Al Hamed, CEO, Mubadala Energy, said. “This is not only a significant development for Mubadala Energy but a huge milestone for Indonesia’s and Southeast Asia’s energy security.”
This new discovery is the second consecutive successful well for Mubadala in the Andaman area, coming after the success of Timpan-1 in Andaman-II, which itself came after success at Cengkih-1 in our SK320 in Malaysia.
The well, which successfully flowed over 30mn ft3/day of gas, solidifies the basin's position as one of Asia Pacific's most promising emerging deepwater hotspots, according to industry analysts at Wood Mackenzie.
Mubadala has estimated in-place volumes for the discovery at over 6 trillion ft3 of gas. Given the size of the structure and a single well drilled to date, Wood Mackenzie estimates an initial 3.3 trillion ft3 of recoverable resources, equivalent to over 580mn barrels of oil equivalent. This would make Layaran the second largest deepwater discovery globally in 2023.
Wood Mackenzie's estimate assumes a conservative recovery factor, but future appraisal success could significantly increase this recoverable estimate. A recovery factor of 75% would see recoverable resources rise to 4.5 trillion ft3 (790mn boe).
"While Layaran-1 benefits from negligible reservoir CO2 and improved reservoir quality, the challenge lies in developing a resource of this magnitude," Harwood said. "With local demand constrained, Mubadala will need to explore new markets, potentially through improved connectivity with the rest of Sumatra or by restarting exports from the mothballed Arun LNG plant."
Regarding potential sales markets, Harwood added that pipeline connections to Singapore, Malaysia, or Thailand are under consideration, but the authorities will likely prefer domestic sales.