Mubadala Energy announces major gas discovery in South Andaman

United Arab Emirates' Mubadala Energy said it discovered a major deep sea gas reserve in Indonesia's South Andaman Block, which analysts said is the world's second-largest deep water discovery this year.

Through Layaran-1 exploration well at the South Andaman block, Mubadala said the discovery has potential gas-in-place for more than 6 trillion cubic feet (tcf). South Andaman Block is located around 100 km (62 miles) off northern Sumatra.

Mubadala drilled to a depth of 4,208 metres (13,805 feet)well in 1,207 metres (3,959 feet) water depth. It is Mubadala's first deep water operation, it said in a statement on Tuesday.

Given the size of the structure and a single well drilled to date, Wood Mackenzie estimates an initial 3.3 tcf of recoverable resources, which would make Layaran the second largest deepwater discovery globally in 2023, it said in a note on Wednesday.

"This development offers material commercial opportunities and adds momentum to our strategic growth story," Mubadala chief executive Mansoor Mohamed Al Hamed said in the statement.

"This is not only a significant development for Mubadala Energy but a huge milestone for Indonesia's and Southeast Asia's energy security."

Indonesia's upstream oil and gas regulator (SKK Migas) said this discovery is important for Southeast Asia's biggest economy's goal to reach gas output of 12 billion standard cubic feet per day in 2030, it said in a statement.