Jakarta. Indonesia announced on Thursday that the long-delayed Masela offshore gas block in Maluku is now expected to begin production in 2029, following the launch of the front-end engineering and design (FEED) phase.

Deputy Energy and Mineral Resources Minister Yuliot Tanjung said the Masela project, first discovered in the Arafura Sea in 1998, will require an investment of $20.94 billion. Once operational, it is projected to produce 9.5 million tons of liquefied natural gas (LNG) annually and around 35,000 barrels of condensate per day, supplying both domestic needs and exports.

“With this $20.94 billion investment, the project will create around 12,600 jobs during development and 850 jobs during operations. We expect significant multiplier effects that directly benefit local communities,” Yuliot said in a statement.

The government pledged to streamline procurement rules and accelerate permitting to keep the project on schedule. “Licensing is now handled by an integrated team, and we expect approvals to be issued without major delays,” Yuliot added.

The Masela Block is operated by Japan’s Inpex Masela Ltd, which holds a 65 percent stake. The remaining 35 percent is owned jointly by Indonesia’s Pertamina and Malaysia’s Petronas, which acquired Shell’s share in July 2023.

The block, originally awarded in 1998 with a concession set to expire in 2028, received a 20-year extension. However, progress has been repeatedly delayed, drawing criticism from government officials. In May, Energy Minister Bahlil Lahadalia warned that Indonesia spends about Rp 500 trillion ($30.75 billion) annually on energy imports despite its abundant reserves. He criticized the 26-year delay at Masela, insisting that “the nation should guide corporations, not the other way around.”

With the FEED phase now underway, production is still at least four years away.