Stakeholder Update
PT PEMA Aceh Carbon Makes Progress with the Arun Carbon Capture and Storage Project.
June 1, 2023
Carbon Aceh Pte Ltd (“Carbon Aceh or the Company”) is pleased to provide an update to stakeholders regarding progress made by PT PEMA Aceh Carbon (“PT PAC”) the JV company owned in partnership with PT Pembangunan Aceh (“PEMA”) a company wholly owned by the Government of Aceh.
HIGHLIGHTS
-
Formation of PT PEMA Aceh Carbon jointly owned by PEMA and Carbon Aceh
-
Presentation by PT PAC at the B20 Summit in parallel with G20 Summit of world leaders
-
Receipt of Arun technical data
-
Inaugural meeting of PT PAC Commissioners
-
Arun CCS Feasibility Study underway
PT PEMA Carbon Aceh
In September 2022 the Company signed a Joint Venture Agreement (“JV”) with PEMA an enterprise owned by the Government of Aceh to create PT PAC as a Joint Venture company to evaluate and re-develop the depleted Arun gas field for carbon capture and storage (“Arun CCS”).
Figure 1. Signing ceremony to establish the JV company PT Pema Aceh Carbon with President Director of PEMA, Ali Mulyagusdin (centre right) and Managing Director of Carbon Aceh, David Lim (centre left)
The Arun CCS project has been recognised as a project of national significance which will contribute to turning the province of Aceh in Indonesia into a regional CCS hub and will materially assist Indonesia in meeting its emission reduction targets agreed under the Paris Protocol.
The signing of the JV was carried out in Indonesia by the President Director of PEMA, Ali Mulyagusdin and Managing Director of Carbon Aceh, David Lim.
NOVEMBER
Incorporation of PT PAC
PT PAC was officially incorporated by Kementerian Hukum Dan Hak Asasi Manusia (Ministry of Law and Human Rights).
Briefing the Indonesian Ambassador to Australia
During November David Lim (Carbon Aceh), Sammy Hamzah (Carbon Aceh) accompanied by Linda Stalker (CSIRO, Australian Government research organisation) briefed HE, The Indonesian Ambassador to Australia Pak Siswo Pramono on the Arun CCS project.
Figure 2. Linda Stalker (CSIRO), HE Ambassador Siswo Pramono, David Lim (Carbon Aceh), Sammy Hamzah (Carbon Aceh)
B20 Summit & Bloomberg NEF Summit
During November PT PAC represented by Ali Mulyagusdin (PEMA) and David Lim (Carbon Aceh) were invited to present details of the Arun CCS project at the B20 Business Leaders’ Summit. The presentation was well received with particularly fruitful discussions with various of the distinguished guests and delegates in attendance.
Figure 3 (A.) David Lim and Ali Mulyagusdin (PEMA) presenting at the B20 Business Leaders’ Summit. (B.) David Lim meeting HE Gubernur Anies Baswedan (C.) David Lim and Ali Mulyagusdin meeting HE Gubernur Ridwan Kamil.
DECEMBER
Office facilities
In December PT PAC renovated and refurbished part of Rumah Budaya, a heritage building in Banda Aceh, as its headquarters.
Figure 4. PT PAC office refurbishment
JANUARY
Release of technical data
In January, Dr. Andang Bachtiar, Carbon Aceh’s Country Manager led a team of technical experts on a visit to the Arun Field and then in February the documentation permitting the release of technical data was completed.
Figure 5. Dr Andang Bachtiar leads the PT PAC team on a visit to the Arun Field
FEBRUARY
Executive appointment
In February, Pak Marzuki Daham was appointed President Director of PT PAC.
Marzuki Daham is an alumnus of Texas A&M where he graduated with a BSc in Petroleum Engineering. There are few more qualified to lead PT PAC and the re-development of Arun. Pak Marzuki began his career in the oil industry over 40 years ago on the Arun field. He spent 9 years on the Arun field gaining experience on field operations before moving on to various senior Commercial and Technical positions in Mobil Oil - now ExxonMobil, Chevron Indonesia and state owned PGN LNG Indonesia. Between 2016 and 2018, Pak Marzuki Daham was the Chairman of BPMA, the Oil & Gas Regulatory Body of Aceh. In that role, Mr. Daham managed the upstream oil and gas industry in Aceh province to protect government interest while working together with PSC contractors to encourage exploration and development within the corridor of existing regulations.
MARCH
Progress meeting
In March, Carbon Aceh and PT PAC management met with the Director General of MIGAS, Professor Tutuka Ariadji to provide an update on the status of the data gathering and progress of the Arun CCS project. Professor Tutuka graciously offered the services of MIGAS personnel to expedite data transfer from Pertamina Hulu Energi (PHE), PEMA Global Energy (PGE), and PUSDATIN (the national data base).
The Arun data is being accessed from different sources and in a variety of formats. The collation and curation of Arun data is a major and painstaking undertaking which will take several months. This vital task is being undertaken by Dr. Andang Bachtiar and his team based in Banda Aceh and Jakarta. The results of this work will be the foundation upon which the project will be built and will be restored to the national archive as an asset of the nation.
Figure 6. Muhammad Slamet (Director, PT PAC), Marzuki Daham (President Director, PT PAC), David Lim (Carbon Aceh), Professor Tutuka (Director General MIGAS), Professor Doddy Abdassah (Advisor to PT PAC and Head of the Center of Excellence on Carbon Capture Storage and Carbon Capture, Utility and Storage, Institut Teknologi Bandung), Andang Bachtiar (Carbon Aceh)
Board of Commissioners
The inaugural meeting of the PT PAC Board of Commissioners took place in Jakarta during March. The meeting discussed and endorsed the preliminary Business Plan, Organisational Structure and Accounting Procedures. Alongside the collation and curation of the data this too is a foundation upon which the company will be built.
Figure 7. Inaugural meeting of the PT PAC Board of Commissioners L to R: Wenny Amandy (Carbon Aceh), Sofyan Dawood (Commissioner), Andang Bachtiar (Commissioner), Mahdi Nur (President Commissioner), David Lim (Commissioner), Muhamad Slamet (Director, PT PAC), Teuku Kamaruzzaman (Director, PT PAC), Alan Stein (Commissioner), Iman Prayitno (Carbon Aceh)
Arun CCS Feasibility Study
The foundation agreements under which PT PAC was established mandate the company to develop, implement, and operate the Arun CCS Project which will be used to reduce carbon emissions and facilitate economic development across the whole region. In addition to a detailed study of the Arun reservoir, the study will evaluate the potential for reusing the existing wells, pipelines, and all facilities and equipment considered necessary for the operation of a CCS project. Thanks to the significant progress made by Dr. Andang Bachtiar and his team in collating and curating the Arun data the feasibility study is now ready to begin.
Figure 8. Geologists from Dr Andang Bachtiar’s team reviewing data from Arun
Managing Director of Carbon Aceh Pte Ltd David Lim commented “We are delighted with the support that PT PAC has received across all levels of Government in Aceh and Indonesia. This is justifiably regarded as a project of national significance for Indonesia and we are proud to be a part of it via our shareholding in PT PAC. Repurposing the Arun reservoir as a CCS facility will deliver ongoing economic growth for Aceh while at the same time making a meaning contribution to emissions reduction with one of the largest CCS projects in the world.”
For further details please contact
Carbon Aceh Pte Ltd
Email info@carbonaceh.com
About Carbon Capture and Storage
CCS involves the capture of carbon dioxide (CO2) emissions from oil and gas production, industrial processes, such as steel and cement production, or from the burning of fossil fuels in power generation. This carbon is then transported from where it was produced, via ship or in a pipeline, and stored deep underground in geological formations.
The role of Carbon Capture and Storage (CCS) in meeting global energy and climate goals is widely acknowledged. Without CCS the world will not meet emissions reduction targets. The International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC) predict that CCS will make a significant contribution (15-55%) of the abatement required to hold atmospheric concentrations of greenhouse gases to 450 parts per million (ppm) by 2050. The size of the global CCS industry could approach that of the world natural gas industry within a few decades creating a significant engine of growth, alongside renewable energy, in the new low emissions economy.
About the Arun Field
From about 1980 to 2000, Indonesia was the world’s largest exporter of Liquefied Natural Gas (“LNG”) and the giant Arun Field in Aceh, discovered by Mobil Oil Corporation in 1971 was responsible for around 30% of Indonesia’s LNG production. During the early 1990s the Arun Field was producing more than 100,000 barrels of condensate per day and 3,500 million cubic feet of gas per day which was feeding 6 LNG trains capable of producing more than 10 million tons of LNG per annum. The field was responsible for 25% of Mobil’s global profits and was one of the cornerstones of the Indonesian economy.
Although the field continues to produce very small volumes of gas, the Arun LNG business was shut down in 2014 due to declining production rates and low reservoir pressures. Arun is one of the largest oil and gas fields in the Asia Pacific with cumulative production of more than 16 trillion cubic feet of gas and 700 million barrels of condensate. It is now one of the largest, if not the largest, depleted oil and gas fields in the region.
The Arun field was developed with wells and infrastructure concentrated into four clusters. More than 140 wells have been drilled across the field with most being equipped with 10,000 psi working pressure stainless-steel well heads to resist corrosion from high-pressure and high-temperature production fluids containing CO2.
Gas was reinjected into the reservoir through 12 injection wells for pressure maintenance. Over the period 1976 to 1997 5.2 trillion cubic feet of gas was reinjected into the reservoir providing valuable data on the behaviour of the reservoir during injection.
The field had a very high initial reservoir pressure of more than 7,000 psi and a temperature of 180oC at a depth of 3,000m sub sea. By 2005 reservoir pressure had decreased to around 500 psi which is encouraging from a CO2 injection perspective.
Repurposing Arun as a regional CCS hub will have a significant impact on the local and regional economy of Aceh. There will be new jobs created from both the construction and operation of the facility. There are undeveloped gas fields in the region potentially containing more than 500 million tonnes of CO2. These fields are currently stranded but could potentially be developed if CO2 were separated from the sales gas and stored in the Arun facility. The gas produced from these fields could be used to displace coal currently used in power generation and/or to produce blue hydrogen and ammonia.