Transition Strategy and Investment: The Government’s Key to Achieving Energy Self-Sufficiency
By: Muhammad Reza Wibisono *)
The Indonesian government is increasingly affirming the direction of its national energy policy through two strategic pillars: energy transition and strengthening investment in the upstream oil and gas sector. These two pillars form a crucial foundation for realizing energy self-sufficiency, which simultaneously strengthens national sovereignty and resilience. The synergy between the development of New Renewable Energy (NRE) and the optimization of the upstream oil and gas sector is expected to create a reliable, efficient, and sustainable energy system while mitigating the impact of global market fluctuations.
The global oil price fluctuations, which often reach USD 100 per barrel, indicate uncertainties in global supply. Geopolitical factors, such as conflicts in Southeast Asia, also affect the stability of energy markets. This situation makes the Indonesian government’s strategy to maintain energy resilience increasingly relevant and urgent. In this context, energy transition is not only an effort to diversify resources but also a national strategy to strengthen Indonesia’s position in the global energy map.
The Minister of Energy and Mineral Resources (ESDM), Bahlil Lahadalia, continues to push for achieving oil and gas lifting targets through pragmatic approaches, including field optimization, utilization of advanced technology such as Enhanced Oil Recovery (EOR), reactivation of old wells, and implementation of supportive regulations and incentives to accelerate exploration and production. He believes that energy self-sufficiency, which is more complex than food self-sufficiency, can be achieved by 2029–2030 if these policies are consistently and sustainably applied. These measures also align with the government’s targets to increase oil production to 610,000 barrels per day by 2026 and gas production to 6.5 billion cubic feet per day.
The Secretary of the Special Task Force for Upstream Oil and Gas Business Activities (SKK Migas), Luky Agung Yusgiantoro, stated that global oil prices once approached USD 100 per barrel but remained stable despite geopolitical dynamics such as the conflict between Thailand and Cambodia. He emphasized that price stabilization is important in formulating upstream oil and gas investment projections. Luky also conveyed that investment in the upstream oil and gas sector is predicted to continue increasing because the government is implementing various strategic approaches, including increasing production, adopting new technologies, exploring new reserves, reactivating old wells, and utilizing Enhanced Oil Recovery (EOR) to support the current administration’s Asta Cita program.
The Deputy for Coordination of Energy and Mineral Resources at the Coordinating Ministry for Economic Affairs, Elen Setiadi, stated that reports show increasing investment attractiveness in Indonesia’s oil and gas sector, driven by large reserve discoveries and fiscal reforms. However, she stressed that challenges such as competitiveness, regulation, bureaucracy, and legal certainty still need to be addressed comprehensively. Elen also mentioned that the government is improving oil and gas regulations and energy transition policies, including implementing Carbon Capture and Storage (CCS) technology to support sustainable sector development.
The government is also pushing for the implementation of several strategic projects in the upstream oil and gas sector, including the development of Tangguh UCC gas, IDD Geng North, and the Abadi Project, which involve significant investments. Additionally, the construction of Solar Power Plants (PLTS) and Battery Energy Storage Systems (BESS) is targeted to reach 100 GW and 320 GWh, including expanding to villages across various regions. These efforts create synergy that not only broadens energy access but also supports national decarbonization efforts, creates new jobs, and strengthens supporting industries such as battery manufacturing and renewable energy technology.
The implementation of energy transition and strengthening upstream oil and gas also has positive impacts on economic equity. Villages previously without electricity can now enjoy renewable energy, increasing community productivity and opening local business opportunities. This synergy reflects the government’s efforts to integrate economic, social, and environmental aspects into the national energy strategy.
Along with increasingly complex global dynamics, including political-economic pressures and climate crisis challenges, this strategic energy policy further strengthens Indonesia’s position on the international stage. Energy resilience becomes the foundation of a strong national economy, enabling Indonesia to face external shocks, maintain development stability, and enhance competitiveness in the global energy market. This approach also demonstrates the government’s commitment to ensuring a fair, effective, and sustainable energy transition.
The success of this initiative is inseparable from effective collaboration among various government agencies and state-owned enterprises. Solid synergy between institutions enables integrated policy formulation and implementation, ensuring programs run according to national targets. The government also encourages private sector participation through fiscal incentives and regulatory ease, strengthening a healthy, transparent, and sustainable investment ecosystem.
With strong policy footing and significant investment support, the government is increasingly approaching the achievement of energy self-sufficiency by 2029-2030—a realistic and measurable target, not merely an ambition. The fair energy transition approach, strengthening investment in the upstream oil and gas sector, and commitment to developing new renewable energy are concrete evidence of the government’s commitment to national sovereignty and community welfare. Amid global uncertainties, this strategy shows Indonesia’s vision as an independent, resilient, and progressive nation in managing sustainable energy.
*) The author is a public policy analyst
