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June 18, 2013
Venue : Jakarta, Indonesia

Asian Development Bank prepares to support SATREPS Indonesia CCS project - SATREPS Director Hideki Mizuma (JST) signs MOU

SATREPS (Science and Technology Research Partnership for Sustainable Development)

MOU signing party. SATREPS Director Hideki Mizuma is on the right.

On June 18, at the Jakarta headquarters office of Pertamina, oil and gas corporation, the Pertamina, JICA (Japan International corporation Agency) and the Asian Development Bank (ADB) signed a memorandum of understanding (MOU) that will potentially lead to the bank co-funding the SATREPS “Pilot Study for Carbon Sequestration and Monitoring in Gundih Area - Central Java Province, Indonesia” project. This project, led by principal investigator Prof. Toshifumi Matsuoka of Kyoto University was adopted by SATREPS in FY2011. The SATREPS programme has so far adopted (or conditionally approved) 78 projects, but to date none has attracted the participation of international institutions or corporations. If this plan comes to fruition, it will be the first such case.

This project aims to be the first in Southeast Asia to research and develop technology for carbon sequestration (CCS) along with management and leakage monitoring. However, sequestration is a major challenge that goes beyond the SATREPS framework. Because of the scale of the costs involved, they either need to be considered as part of the expenses associated with oil and gas extraction, or to be covered by funding from other sources. After adoption, the project commenced in July 2012, and is due to run for five years, with an interim review of the project term likely depending on the feasibility of sequestration.

Following the signing of the MOU, the ADB will provide capital to Institut Teknologi Bandung (ITB), funding a survey to determine the feasibility of carbon sequestration in the Gundih gas field. If the survey finds an appropriate site and the Indonesian government makes a formal request, the ADB plans to bear the costs associated with sequestration in the pilot project. The ADB has declared that it is able to provide the Indonesian government with funding in the range of US$10 million - $12 million to cover the operating costs of a CCS pilot project. If this initiative succeeds and sequestration is achieved, overcoming the most significant bottleneck, the project is more likely to continue for the full five years.

At the signing ceremony, the MOU was signed by Mr. Muhamad Husen, Upstream Director of PT. Pertamina and also Chief Commissioner of Pertamina EP; Dr. Pradeep J. Tharakan, Energy Specialist (Climate Change), Asian Development Bank (ADB); and Mr. Atsushi Sasaki, Chief Representative, JICA Indonesia Office, representing the parties to the MOU. It was also signed by Ir. Edi Hermantoro, Director General of Oil and Gas (MIGAS), Ministry of Energy and Mineral Resources, Indonesia; Prof. Dr. Djoko Santoso, Director General of Higher Education, Ministry of Education and Culture, Indonesia; Dr. Montty Girianna, Director for Mining, Mineral and Energy resources, The National Development Planning Agency of Indonesia (BAPPENAS); and Mr. Hideki Mizuma, Director, Research Partnership for Sustainable Development Division, Japan Science and Technology Agency (JST), acting as witnesses. This SATREPS project Principal Investigator, Prof. Toshifumi Matsuoka of Kyoto University, and Project Director for the Indonesian side, Prof. Dr. Wawan Gunawan A. Kadir, Vice President of Institute Technology Bandung (ITB) also attended to observe the signing.

Dr. Tharakan had declared the ADB’s willingness to co-fund this project in September 2012, but it took a further nine months of negotiation and liaison between the various institutions on the details of the MOU before it could finally be signed. At the ceremony, he described how moving it was to have reached this point after such a long period of preparation, and called on everyone involved to continue working together to ensure that the project proceeds successfully.

The ADB has been conducting CCS feasibility studies in four Southeast Asian countries, namely Vietnam, Thailand, the Philippines, and Indonesia. Those studies found that Indonesia was the most likely contender for successful CCS. Then, when the ADB approached the DG MIGAS, Ministry of Energy and Mineral Resources, Indonesia for cooperation on the next stage it was requested to merge its initiative with the SATREPS project, which had only just started. That request eventually led to this joint endeavor. The signing ceremony brought representatives of all the participating institutions together, including people from Japan. The fact that all the representatives gathered together at the same time is an indicator of the expectations that they share in this project. We sincerely hope that the project will run smoothly and eventually lead to significant success.

JST, an integrated organization of science and technology in Japan, establishes an infrastructure for the entire process from the creation of knowledge to the return to the society. For more information, visit http://www.jst.go.jp/EN/