Indonesia has declared self-sufficiency in diesel fuel following the inauguration of the Balikpapan Refinery Development Master Plan (RDMP). The project, officiated by President Prabowo Subianto, marks a milestone in the country’s energy independence strategy. With domestic production now meeting national demand, the government sees this as a foundation for broader energy resilience.
Key Facts & Background
- RDMP Inauguration:
- President Prabowo Subianto inaugurated Pertamina’s RDMP at Refinery Unit V Balikpapan, East Kalimantan, on 12 January 2026.
- Last major refinery inauguration was in 1994, making this the first in 32 years.
- Capacity & Output:
- RDMP Balikpapan processes up to 360,000 barrels of oil per day, covering 22–25% of national demand.
- Produces diesel, LPG, and petrochemical products.
- Upgrades fuel quality to Euro V standard (sulfur content 10 ppm), from Euro II.
- Yield of valuable products targeted at 91.8%.
- Investment & Economic Impact:
- Total investment: Rp123 trillion.
- Expected savings from reduced fuel imports: Rp68 trillion per year.
- Contribution to GDP projected at Rp514 trillion.
- Energy Policy Statements:
- Coordinating Minister for Economic Affairs Airlangga Hartarto confirmed Indonesia no longer needs to import diesel.
- Energy Minister Bahlil Lahadalia emphasized RDMP Balikpapan as the largest refinery in Indonesia.
- Government plans to stop diesel imports for private fuel stations (SPBU) in 2026, supported by the B50 biodiesel program.
- Broader Energy Vision:
- President Prabowo highlighted Indonesia’s abundant natural resources, including palm oil for biodiesel, geothermal, solar, and hydropower.
- Government aims to maximize these resources to reduce reliance on foreign energy.
Strategic Insights
The completion of the Balikpapan RDMP signals a turning point in Indonesia’s energy landscape. By achieving diesel self-sufficiency, the country reduces its vulnerability to global fuel price fluctuations and strengthens its fiscal position through significant import savings. The refinery’s modernization also aligns with environmental goals by producing cleaner fuels that meet international standards, positioning Indonesia more competitively in the regional energy market.
Beyond immediate economic benefits, the RDMP reflects a broader strategy of energy diversification and industrial downstreaming. Integrating biodiesel programs with refinery expansion demonstrates a dual approach: leveraging renewable resources while modernizing fossil fuel infrastructure. This balance is critical for long-term energy security, as Indonesia seeks to transition toward sustainable energy while maintaining stability in supply. The project underscores the role of infrastructure investment in building resilience, supporting industrial growth, and reinforcing national independence in the energy sector.