The oil and gas import diversification scheme aims to strengthen energy security. However, the core challenge lies upstream—in boosting domestic production and reducing import dependence.
The Ministry of Energy and Mineral Resources (ESDM) has opened the door for the Oil and Gas Testing Center, or Lemigas, to undertake oil and gas imports. The move follows the issuance of Presidential Regulation No. 26/2026 on the Procurement of Crude Oil, Fuel Oil, and/or Liquefied Petroleum Gas for National Energy Security.
In addition to imports carried out by state-owned enterprises and private companies, the regulation authorizes energy-sector Public Service Agencies (BLUs) to import oil and gas. Article 4 stipulates that imports by BLUs must be conducted under cooperation agreements, either between governments or between the central government and overseas suppliers.
“We will optimize the use of existing BLUs, including Lemigas,” Deputy Minister of Energy and Mineral Resources Yuliot Tanjung said on Friday, May 29, 2026, as quoted by Antara.
The regulation also allows BLUs to carry out imports beyond such cooperation agreements to meet strategic energy reserve and operational stock requirements. This aligns with the regulation’s broader objectives: to ensure sound governance in oil and gas procurement while strengthening the continuity, reliability, and resilience of the country’s energy supply.
Aryanto Nugroho, National Coordinator of Publish What You Pay (PWYP) Indonesia, said involving BLUs in import procurement could help address the country’s energy needs. However, he stressed that the scheme should be viewed as a short-term measure.
“This is not the answer to the structural challenges facing our energy security,” Aryanto told Tempo on Sunday, May 31, 2026.
According to Aryanto, true energy security is not determined by who imports oil and gas, but by how far the country can reduce its reliance on imports.
If the government’s objective is to achieve national energy security, Aryanto argued, the focus should not be on diversifying import channels through energy-sector BLUs. Instead, policymakers should address the root causes of the problem in the upstream sector, particularly the decline in oil and gas production.
“The government must halt the decline in oil and gas lifting, complete refinery revitalization projects, and ensure that domestically produced oil is fully absorbed,” he said.
He also called for an acceleration of Indonesia’s just energy transition.
“The government must promote renewable energy development and manage demand in order to reduce fossil fuel consumption,” Aryanto added.
A similar view was expressed by Muhammad Ishak Razak, a researcher at the Center of Reform on Economics (CORE). He said oil and gas imports by BLUs could serve as an effective short-term instrument, but genuine energy security would only be achieved if the policy were accompanied by accelerated domestic oil exploration.
That effort, he said, must also include expanding domestic refining capacity and speeding up the energy transition.
“The goal should not be to increase and expand import capacity,” Ishak said.
Meanwhile, President Prabowo Subianto has set a target of raising oil lifting to between 602,000 and 615,000 barrels per day by 2027. The target is only slightly higher than the 2026 lifting assumption of 610,000 barrels per day.
To boost production, the government plans to auction 13 new oil and gas blocks this year. Laode Sulaeman, Director General of Oil and Gas at the Ministry of Energy and Mineral Resources, said the blocks would be offered through both direct offers and regular tenders, with flexibility allowing for uncapped cost recovery.
In addition, the ministry has prepared three strategies to increase oil output. First, optimizing production through the application of enhanced oil recovery (EOR) technology. Second, reactivating at least 16,000 idle oil wells that are currently not producing. Third, expanding exploration in new oil and gas basins.
Earlier, Energy and Mineral Resources Minister Bahlil Lahadalia said the government plans to auction 60 oil and gas working areas by 2028 in an effort to attract new investment.
Source: Tempo