The Japanese energy major currently has a 100% stake in Abadi and is planning to drill four appraisal wells late this year and early next year to confirm the size of reserves at the field before making a final decision, an Inpex spokesman told the newspaper.

“But at this point, we think the field has the size of reserves that can produce LNG,” he said.

Last year, the then Northern Territory director of petroleum developments Andrew Andrejewskis (now head of junior explorer SAPEX) estimated that Abadi could hold between 7 trillion and 10 trillion cubic feet of gas.

Abadi is in eastern Indonesia, east of the Joint Petroleum Development Area and due north of Darwin and the Tiwi Islands. Under Inpex’s development model, Abadi gas would be piped to Darwin for liquefaction. Production volume would about 3-5 million tonnes per year.

Inpex plans to submit a production plan to the Indonesian Government in 2008 and is aiming for first LNG by 2015. The project is expected to cost about $5.55 billion.

Inpex is already a member of the Bayu-Undan/Darwin LNG consortium. But with ConocoPhillips having a majority stake in the project, there is no guarantee that Abadi gas could be processed via a new Darwin LNG train – Inpex will probably have to find a greenfields site.