Saipem has secured a major Engineering, Procurement, Construction and Installation (EPCI) contract worth approximately $2 billion for its share of the Kutei FPSO project, marking one of the largest offshore energy developments currently underway in Southeast Asia. The award reinforces Saipem’s leadership in the global floating production market while advancing the Kutei North Hub development in Indonesia’s prolific Kutei Basin.
The contract was awarded to PT Saipem Indonesia, working in a joint venture with PT Tripatra Engineers and Constructors, by Eni North Ganal, a company controlled by Searah Ltd., the business combination established by Eni and Petronas. The project is located offshore East Kalimantan, Indonesia, and represents a significant milestone in the development of the Kutei North Hub Field.
Under the agreement, Saipem will execute the full Engineering, Procurement, Construction and Installation (EPCI) scope for the Kutei FPSO, including project management, detailed engineering, procurement of equipment and materials, fabrication, offshore construction, installation, commissioning and start-up activities. The project is expected to be completed over an estimated 48-month execution period.
The Kutei FPSO project forms the centrepiece of the broader Kutei North Hub Development, a strategic offshore oil and gas project designed to unlock hydrocarbon resources in the Kutei Basin. The development includes a subsea production system connected to the new Kutei FPSO, together with a dedicated gas export pipeline that will transport natural gas to the Bontang LNG Plant as well as domestic consumers through the existing East Kalimantan gas transmission network.
Industry observers view the Kutei FPSO as one of Indonesia’s most significant offshore infrastructure projects, combining advanced floating production technology with extensive subsea development. Once operational, the floating production, storage and offloading facility will play a critical role in processing hydrocarbons from the Kutei North Hub while supporting Indonesia’s long-term energy production and gas supply objectives.
For Saipem, the Kutei FPSO contract further strengthens its position as one of the world’s leading contractors for floating production systems. The company said the award reflects its ability to combine world-class engineering expertise with local fabrication capabilities and proven experience in delivering complex offshore projects on accelerated schedules. The contract also expands Saipem’s portfolio of major FPSO developments across the Asia-Pacific region.
The award underscores growing investment in Indonesia’s offshore oil and gas industry as operators continue developing large-scale deepwater resources to meet rising regional energy demand. The Kutei North Hub project is expected to generate significant economic activity through engineering, fabrication, offshore installation and long-term production operations, while enhancing Indonesia’s position as a key LNG and natural gas producer.
Saipem noted that the transaction qualifies as a related-party transaction under Italian financial market regulations because the contract was awarded by Eni North Ganal, a subsidiary of Searah Ltd., which is jointly controlled by Eni and Petronas. The company stated that the agreement was executed under ordinary commercial terms and in accordance with applicable regulatory requirements.
The award of the Kutei FPSO contract represents another major milestone in the global offshore energy sector and highlights continued investment in floating production infrastructure. As engineering and construction activities move forward over the next four years, the Kutei FPSO is expected to become one of Indonesia’s flagship offshore production facilities, supporting increased oil and gas output from the Kutei Basin and reinforcing Saipem’s reputation as a global leader in FPSO engineering, procurement, construction and installation.
