Indonesia’s domestic demand for oil products is expected to rise by 2026, but the needs of imports would deplete on the back of the expansion of refinery capacity.
At the moment, Indonesia’s oil product output is around 880,000 bpd and imports are at 425,000 bpd, a third of the country’s needs.
In the next six years, the country’s domestic demand for oil products to increase by 12% or about 160,000 bpd. Fuel demand is likely to climb to 1.47 million bpd, based on projected growth by 3.2% each year.
However, the energy ministry is optimistic that the need for product imports would be minimal as the domestic refined product output could rise by around 70% to 1.5 million bpd by then.
Indonesia initially aimed to reach self-sufficiency by 2023 with several new refineries and capacity expansion projects on the way.
Two new refineries are planned, one in Bontang, East Borneo, and another one in Tuban, East Java. Both will have production capacities of 300,000 bpd and the Bontang one is scheduled to be complete in 2025.
The expansion projects include the 15% expansion to 400,000 bpd at Cilacap refinery, the doubling the capacity at Balongan to 240,000 bpd, the 38.5% expansion of Balikpapan refinery to 360,000 bpd, and an upgrade to the 170,000 bpd Dumai refinery.
However, project delays are weighing down the expansion. Saudi Aramco did not proceed with the Cilacap expansion project, while others which have been plagued by drawn-out negotiations, community opposition, and state-run Pertamina's financial difficulties.
