Indonesia energy minister Bahlil Lahadalia pushes fuel and gas self‑sufficiency

Indonesia’s Minister of Energy and Mineral Resources, Bahlil Lahadalia, announced a series of measures to reduce fuel imports and strengthen domestic energy production. He noted that subsidies for gasoline and diesel have risen to roughly Rp 250 trillion due to high crude prices, but higher Indonesia Crude Price also boosts state revenue, prompting a plan to raise royalties on minerals to offset costs.

Bahlil is accelerating the adoption of compressed natural gas (CNG) to replace liquefied petroleum gas (LPG) imports, with trials of 3‑kg CNG cylinders for household use and existing 12‑kg and 50‑kg cylinders already in commercial service. He inaugurated a Mini LNG Plant in Tuban that will produce LNG, CNG, LPG, condensate and liquid CO₂, aiming to meet domestic gas demand and cut LPG imports.

Addressing rising industrial gas prices, Bahlil blamed reduced lifting and reliance on LNG from eastern Indonesia, and has met with PGN and Pertamina to seek solutions. He also highlighted a coal‑supply issue for PLN, forming a task‑force to secure specific coal grades. The minister unveiled a mandatory biodiesel mandate (B50) to curb diesel imports and indicated the program could be expanded to B70‑B80 by adding palm‑oil acreage.

Further, Bahlil confirmed the Masela gas field project will start construction in 2027, with production expected by 2029‑2030, and set a target to limit gasoline imports to 20 million kiloliters per year while exploring de‑dollarisation of energy trade. He positioned Indonesia to transition from a “petro‑state” to an “electro‑state” amid global energy volatility.