Mubadala Energy, a leading international energy company, and PT Pupuk Iskandar Muda (PIM), a subsidiary of PT Pupuk Indonesia (Persero), have entered into a strategic partnership to explore the utilization of gas resources from South Andaman. The Memorandum of Understanding (MoU), signed on December 11, 2024, aims to assess the feasibility and benefits of the gas reserves in the Layaran-1 and Tangkulo-1 fields.

The South Andaman reserves hold immense potential, with estimates reaching several trillion cubic feet (TCF) of gas in place. This collaboration aligns with Indonesia’s national strategy to sustainably harness domestic energy resources while supporting economic growth and innovation.

Driving Sustainable Energy Development

Abdulla Bu Ali, President Director of Mubadala Energy Indonesia, emphasized the strategic importance of the partnership. “We believe that the South Andaman reserves can be optimized to deliver significant benefits not only for our company but also for the region,” he said.

The MoU reflects Mubadala Energy’s commitment to sustainable energy development, focusing on maximizing the economic and environmental value of its operations in Indonesia.

Supporting Agriculture and Industrial Growth

Budi Santoso Syarif, CEO of PT Pupuk Iskandar Muda, highlighted the collaboration's dual benefits. The gas supply from Mubadala Energy is critical for the operational needs of PIM and the development of the PIM-3 project, which is set to expand Indonesia’s fertilizer production capacity.

“This collaboration strengthens PIM’s commitment to meeting the growing demands of Indonesia’s agricultural sector. With the gas supply, we can also develop downstream petrochemical industries in Aceh, bringing significant benefits to local communities and reviving Aceh’s past economic glory,” Syarif noted.

The South Andaman project is expected to provide a stable and reliable energy supply for Indonesia’s fertilizer industry, a cornerstone of the country’s agricultural backbone.

Economic and Social Impact

The partnership between Mubadala Energy and PIM has far-reaching implications. Beyond ensuring energy security for the fertilizer and petrochemical industries, the collaboration is poised to create jobs, boost local economic activity, and promote self-reliance in Indonesia’s energy sector.

By leveraging South Andaman’s vast gas reserves, the MoU supports Indonesia’s broader goals of energy sustainability and industrial growth. It also underscores the potential for public-private collaborations to address critical energy and agricultural needs.

A Step Toward Energy Resilience

This partnership represents a milestone in Indonesia’s energy transition. The project’s alignment with national strategies for sustainable resource utilization highlights the government’s focus on balancing energy demands with environmental considerations.

The collaboration between Mubadala Energy and PIM is a testament to the synergy between international expertise and local industrial goals. By combining resources and capabilities, the two companies are well-positioned to make a lasting impact on Indonesia’s energy and agricultural sectors.