Italian energy firm Eni has agreed to sell 10% stakes in seven Indonesian upstream oil and gas blocks to state-owned Pertamina and independent energy company Medco Energi. Announced on October 12, the binding agreements involve major natural gas projects in the Kutei Basin, strengthening domestic control over energy resources.
Italy’s Eni has signed two binding agreements to divest minority interests in key Indonesian upstream assets to state firm Pertamina and independent energy company Medco Energi. The transactions encompass production-sharing contracts across the Kutei Basin offshore East Kalimantan, marking a structural realignment of Eni’s regional portfolio following the creation of its Searah joint venture with Malaysia’s Petronas.
Pertamina Secures Larger Stake in North Hub Project
Under the first agreement, Eni will transfer a 10% participating interest in the East Sepinggan, North Ganal, and Rapak production sharing contracts to Pertamina Hulu Energi, the state-owned group’s upstream exploration and production subsidiary. This transaction raises Pertamina’s participating interest in the East Sepinggan block from 15% to 25%.
Medco Energi to take 10% stake in four Eni oil and gas blocks in Indonesia https://t.co/TjM8EWDFeT https://t.co/TjM8EWDFeT
The package acquired by Pertamina includes the producing Merakes and East Merakes gas fields, alongside the Geng North and Gehem gas discoveries. These discoveries are currently developed through the North Hub gas project, which carries National Strategic Project designation from the Indonesian government.
Pertamina spokesperson Hermansyah Nasroen noted that the acquisition will directly support and advance the Kutei North Hub Project by connecting it to the company’s existing infrastructure and strengthening national energy security.
Medco Energi Expands LNG Footprint Through Kutai Basin Assets
In a separate transaction, Medco Energi agreed to acquire a 10% non-operated participating interest in four oil and gas blocks in the Kutai Basin: Muara Bakau, Ganal, West Ganal, and East Ganal. These assets fall under the operational management of Searah, the 50-50 joint venture formed by Eni and Petronas.
The portfolio acquired by Medco features the producing Jangkrik field, the Maha, Gendalo, and Gandang gas developments tied to the South Hub project, and the recent Geliga gas discovery.
This transaction complements our existing Indonesian portfolio and expands our presence into an established LNG value chain.
Ronald Gunawan, Medco Energi’s CEO
Wood Mackenzie Analysis Cites Alignment for Bontang LNG Plant
Andrew Harwood, research director for global energy intelligence group Wood Mackenzie, observed that the increased domestic participation aligns all stakeholders toward the efficient and timely development of gas resources supporting the Bontang LNG plant.
Harwood pointed out that Pertamina’s acquisitions lean toward near-term development potential, whereas Medco expands its production and longer-term exploration upside.
Exploration Backing and Regulatory Approvals Pending
The asset sales follow heavy exploration success by Eni in the region. Combined figures from the Geng North and Geliga finds indicate more than 10 trillion cubic feet of gas and 650 million barrels of condensate. Final investment decisions for the underlying North Hub and South Hub projects were announced in March.
Eni maintains a substantial footprint in Indonesia through its direct operation of the Peri-Mahakam and Makassar Strait contracts, 100% ownership of the Sapukala block, and its equal stake in Searah, which oversees 19 producing and development assets targeting a production capacity exceeding 500,000 barrels of oil equivalent per day by 2028. The completion of both divestment agreements remains subject to government and regulatory approvals.
