IPA says Indonesia needs faster reforms to attract upstream investment
Thursday, May 21 2026 - 07:56 AM WIB
By Cepi Setiadi
Indonesian Petroleum Association (IPA) said Indonesia needs to accelerate regulatory certainty, project execution and exploration activity to remain competitive in attracting global upstream oil and gas investment.
Speaking at the 50th IPA Convex 2026, IPA President Kathy Wu, who is also Regional President Asia Pacific at bp, said Indonesia holds significant untapped hydrocarbon potential, particularly in deepwater and frontier areas, but converting those resources into production will require a more competitive investment climate and stronger cooperation between government and industry.
“Global uncertainty, including the ongoing conflict in the Middle East, is reminding all of us how exposed energy systems can be and how sharply competition for capital can intensify,” Wu said.
Wu said investor confidence depends heavily on policy consistency and legal certainty because upstream projects require large capital investments, long development periods and carry significant risks.
“When fiscal terms and contracts are respected over time, confidence grows, capital stays, and projects move forward,” she said.
Read also: IPA vows stronger support for Indonesia’s push to lift oil, gas output
IPA also highlighted the need to shorten project cycle times, describing delays in approvals and execution as one of the sector’s main challenges.
Exploration remains another key priority, with Wu noting that more than half of Indonesia’s sedimentary basins are still unexplored or underexplored.
She also welcomed the government’s efforts to offer new exploration blocks to investors as Indonesia seeks to increase oil and gas production.
IPA members include domestic companies such as Pertamina, MedcoEnergi, Energi Mega Persada and Saka Energi, as well as international firms including ExxonMobil, Eni, Inpex, Petronas, Mubadala Energy, KUFPEC and bp.
Wu said the energy sector continues to play an important role in supporting economic growth, employment, industrial activity and public services across Indonesia.
“With strong government leadership and genuine partnership across the industry, Indonesia can realize its full potential in the global energy system and help shape the country’s next era of growth,” she said.
Editing by Alexander Ginting