Strengthening domestic gas supply, Aspebindo pushes government to implement LNG DMO

Indonesian Energy and Coal Suppliers Association (Aspebindo) Chairman Anggawira is urging the government to establish a policy on allocating LNG for domestic needs amid rising national gas demand. He believes such a policy is necessary to maximize the role of natural gas as a transition energy toward cleaner energy sources.

“We all know that Indonesia is currently in a surplus LNG position. However, domestic demand is also already quite large. Going forward, we hope the government can establish a policy to allocate LNG for domestic use,” Anggawira said during a discussion forum.

He noted that the government could consider a policy model similar to the Domestic Market Obligation (DMO) applied in the coal sector. With an LNG DMO, gas supply for power generation, industry, and the household sector would be more secure amid increasing energy demand.

Anggawira also highlighted the need to evaluate several long-term LNG contracts previously agreed upon. He stated that revising or synchronizing these contracts is crucial to ensure the availability of LNG volumes for the domestic market. “Long-term contracts that are already in place need to be evaluated so that domestic allocation policies can be implemented,” he said.

Meanwhile, the Director of Oil and Gas Engineering and Environment at the Ministry of Energy and Mineral Resources (ESDM), Noor Arifin Muhammad, emphasized that natural gas will remain a strategic energy source in supporting the energy transition. He explained that the lower emission profile of natural gas is a strong reason why it remains relevant in the government’s roadmap toward green energy.

“Natural gas emissions are around 25–30 percent lower than oil. That is why gas is a relevant bridging energy in the transition toward green energy,” he said.

Noor Arifin explained that in 2025, the utilization profile of natural gas is projected to be: exports 23 percent, industry 25 percent, fertilizers 12 percent, power generation 17 percent, and domestic LNG 13 percent.

He added that national gas reserves are currently larger than oil reserves, making them more economically advantageous and offering more planning certainty in the long term. However, sustaining gas production still requires new reserve discoveries, meaning exploration must be carried out massively.

Noor Arifin also stressed that efforts to increase oil and gas production must not overlook operational safety. According to him, pushing for higher production often involves more workers and greater load on production facilities, which increases operational risks that must be managed carefully.

“Any increase in production must always be accompanied by strong safety awareness. Facility integrity must be ensured, and all operations must adhere to regulations and good engineering practices,” he asserted.

He emphasized that the government, through the ESDM Ministry, is committed to intensifying safety oversight. “We work 24 hours a day, seven days a week to ensure that oil and gas operations run safely,” he added.