Samsung E&A will embark on its LNG market entry by securing the front-end engineering design (FEED) for an eco-friendly LNG plant in Indonesia.
Samsung E&A announced on the 6th that it received the letter of award from INPEX Masela Ltd., a subsidiary of Japan's largest energy company INPEX, for the front-end engineering design (FEED) work on the 'Indonesia INPEX Abadi Onshore LNG Project' on the 5th.
Samsung E&A will carry out the project in collaboration with KBR Indonesia and Indonesia's state-owned construction company Adhi Karya, aiming to transition to engineering, procurement, and construction (EPC) after completing the front-end engineering design. The contract amount for Samsung E&A is approximately 36 billion won ($26 million), with a contract period of 13 months.
The project, taking place in the Saumlaki region of Maluku Province, Indonesia, involves receiving natural gas produced from the Abadi gas field, liquefying it, and producing 9.5 million tons of LNG and 35,000 barrels of condensate (ultra-light oil) per day.
This LNG project, which captures and stores carbon emissions in nearby offshore oil fields, has also been designated as a national strategic project for Indonesia.
A company official noted that with this contract win, Samsung E&A can gain a competitive edge not only in LNG, which is emerging as a bridge energy in the era of energy transition, but also in the carbon capture and storage (CCS) market, which is recognized as a promising area for global decarbonization.
LNG emits less carbon compared to traditional energy sources, and due to the refining process, it generates fewer pollutants and fine dust particles. Given these eco-friendly characteristics along with the rising power demand in the artificial intelligence (AI) era, the LNG plant market is growing. Carbon capture and storage is evaluated as a key technology for achieving carbon neutrality, which involves capturing carbon emitted during the combustion of conventional energy sources and permanently burying it in depleted oil fields and gas fields.
Samsung E&A plans to successfully execute the project by leveraging its rich local experience from over 20 projects in Indonesia and its differentiated technology stemming from the mid- to long-term core strategy AHEAD, which emphasizes modularization and automation.
Given that this project is in a remote area, a company official explained that they expect various benefits, such as minimizing on-site work and improving quality, through their technological capabilities. They intend to share expertise with KBR, a traditional strong player in the global LNG market, and maximize local collaboration with Adhi Karya to enhance project execution capabilities.
A Samsung E&A official said, 'We will strive to ensure that successful FEED execution leads to follow-up EPC contracts,' adding, 'Through this, we aim to solidify our position in the Southeast Asian market, which is our core market, and to expand technology-based business participation in both the LNG and CCS fields.'