🏭 Indonesia's RDMP Balikpapan: A strategic leap toward national energy independence
Facility expected to reduce fuel imports by IDR 68T, boost GDP by IDR 514T
🎯 The Main Takeaway
Indonesian President Prabowo Subianto inaugurated the integrated energy infrastructure project known as the Refinery Development Master Plan (RDMP) Balikpapan on Monday (1/12) in East Kalimantan. This national strategic project is designed to strengthen Indonesia’s energy resilience, independence, and sustainability.
“Today marks a historic milestone in our long journey as a nation to strengthen energy independence. We are proving that we can stand on our own feet, determine our own destiny, and move toward energy self-sufficiency,”
Simon Aloysius Mantiri - President Director of Pertamina
🔑 Key Highlights
This refinery is the first major facility revitalized in 32 years. Developed since 2019, it represents a massive upgrade in national capacity.
💰 Investment: IDR 123 trillion (USD 7.4 billion)
👷 Job Creation: Over 24,000 jobs during construction and operation
🏭 Local Content: 35% of products and materials sourced domestically
🛢️ Capacity: Processes 360,000 barrels of crude oil per day—the largest in Indonesia
⚡ Integration: Connected to the 78 km Senipah–Balikpapan gas pipeline and Tanjung Batu oil terminal for distribution
“The refinery is designed with greater complexity to produce various high-value products, including LPG, gasoline, and petrochemical feedstocks. This helps reduce imports and strengthen domestic industries,”
Agus Harimutri Yudhoyono - Indonesia’s Coordinating Minister for Infrastructure and Regional Development
📡 Why It’s on Our Radar?
According to Indonesia’s Ministry of Energy and Mineral Resources (ESDM):
📊 Indonesia consumes about 532 million barrels of oil annually, but produces only 212 million barrels in 2024.
⛽ Average gasoline consumption reaches 38 million kiloliters per year, while domestic production amounts to only 14.25 million kiloliters annually.
🚛 Average national diesel demand reaches 39.8 million kiloliters per year, while domestic production stands at 26.5 million kiloliters annually.
As a result, Indonesia relies on imports to meet its demand gap, while accelerating oil refinery development.
⚠️ Why It Matters?
Indonesia faces several impacts as a result of its reliance on oil imports:
📉 Foreign exchange losses: Indonesia needs to import 313 million barrels of oil, resulting in a foreign exchange loss of IDR 523 trillion in 2024. (Kementrian ESDM)
💰 Fiscal pressure: Indonesia needs to allocate large energy subsidies from the state budget, amounting to IDR 230.5 trillion in 2024 for fuel alone, and IDR 281.6 trillion in 2025 for energy subsidies (fuel, LPG, electricity, fertilizers, and housing). (Kemenkeu)
🛑 Supply vulnerability: Reliance on imports exposes Indonesia to global supply disruptions, geopolitical tensions, and shipping risks.
🔍 Fuel price sensitivity: Rising import costs can lead to higher fuel prices, affecting transportation costs, food prices, and overall inflation.
💡 What to Expect?
The RDMP Balikpapan is projected to deliver transformative outcomes:
⛽ Fuel Quality Leap: Upgrading output from Euro 2 to Euro 5 standard, making it more efficient and environmentally friendly.
📉 Import Reduction: Will produce 5.8 million kiloliters of gasoline annually, slashing remaining imports. Its 15.9 million kiloliters of diesel output should end diesel imports by mid-2026.
💸 Major Savings: Cutting fuel imports could save Indonesia up to IDR 68 trillion per year.
📈 Economic Boost: The facility is expected to add approximately IDR 514 trillion to Indonesia’s GDP.
“With the operation of RDMP Balikpapan, we can reduce dependence on imported fuel and LPG, while producing Euro 5–quality products that are more environmentally friendly.”
Bahlil Lahadalia - Indonesia’s Minister of Energy and Mineral Resources
🏡 Why This Hits Home?
The inauguration of RDMP Balikpapan aligns with several key priorities in Indonesia:
🇮🇩 National program: It is part of President Prabowo Subianto’s Asta Cita program, aimed at strengthening national security, resilience, and independence, particularly through achieving energy self-sufficiency.
♨️ Reducing emissions: By upgrading fuel from Euro 2 to Euro 5, the project increases efficiency and reduces environmental impact, supporting Indonesia’s goal of net-zero emissions by 2060.
🏭 Supporting downstream industry: Residual crude conversion boosts downstreaming industry, create jobs, and technology transfer in the country.
📈 Reduces State Deficit: RDMP helps cut import bills and potentially reduce the need for heavy subsidies, supporting government efforts to optimize state budget spending.
“We don’t need to rely on imported energy. This is our target. We hope to reach it in five years, but even if it takes six or seven, the key is that we keep moving forward toward energy independence.”
Prabowo Subianto - Indonesian President
🌍 The Regional Stake
RDMP Balikpapan reshapes Indonesia’s role in the regional energy landscape:
Reduced External Reliance: Expanding refining capacity to 360,000 barrels/day decreases dependence on imports from Singapore and the Middle East.
Shifting Trade Flows: Reduced Indonesian import demand could redirect regional fuel trade, forcing exporters to find new markets.
Elevated Global Role: Producing Euro V-standard fuels positions Indonesia as a key player and potential exporter in ASEAN energy markets.
Investment Magnet: Advanced downstream processing may attract greater foreign investment for petrochemical cooperation.
🧭 Beyond The Headlines
According to Statistics Indonesia, Singapore was the largest source of Indonesia’s crude oil and petroleum product imports in 2024, with a volume of 15.87 million tons valued at USD 11.78 billion. Malaysia ranked second, supplying 6.54 million tons worth USD 4.77 billion.
🔮 The Bottom Line
RDMP Balikpapan is not just a refinery upgrade, it is a cornerstone project for Indonesia’s energy independence, economic development, and sustainable industrial future.
Need More Angles?
Kemenkoinfra Dampingi Presiden Resmikan Infrastruktur RDMP, Menko AHY: Tonggak Kemandirian Energi Nasional
Kementrian ESDM Wakil Menteri ESDM Tekankan Urgensi Ketahanan Energi
Sekretariat Presiden LIVE: Presiden Prabowo Resmikan Infrastruktur Energi Terintegrasi Pertamina RDMP Balikpapan, 12/1/26
Statistics Indonesia Impor Minyak Bumi dan Hasil-Hasil Menurut Negara Asal Utama, 2017-2024
(NGO/ELS)