Coal Downstreaming into DME: Danantara Views This Project as Capable of Reducing LPG Imports
The government is accelerating the development of Dimethyl Ether (DME) as part of the energy downstreaming strategy to reduce high dependence on LPG imports. The DME project in Tanjung Enim, South Sumatra, is one of the main focuses in the national downstreaming agenda’s second phase.
Head of Danantara Indonesia, Rosan Roeslani, emphasised that DME development is a strategic step to strengthen energy resilience while increasing the added value of domestic natural resources.
“Processing coal into DME is a strategic step to reduce dependence on LPG imports while creating added value domestically,” said Rosan during the national downstreaming groundbreaking event in Cilacap on Wednesday (29/4/2026).
According to Rosan, around 80 percent of national LPG needs still rely on imports. This condition makes the energy sector vulnerable to external pressures, both in terms of price and supply.
Therefore, coal downstreaming through DME development is seen as a concrete solution to address these structural issues. In addition to reducing imports, this project also opens opportunities for domestic energy-based industrialisation.
The Tanjung Enim DME project is being developed by MIND ID through PT Bukit Asam Tbk with a production capacity of around 1.4 million tonnes per year. This production is intended as a direct substitute for LPG in the domestic market.
To support its operations, the project requires a supply of around 6.9 million tonnes of coal per year as the main raw material.
From the upstream side, PT Bukit Asam has sufficient production capacity, with realised production reaching around 47.19 million tonnes in 2025, reserves of 2.88 billion tonnes, and resources of 5.72 billion tonnes.
Rosan added that DME development not only impacts energy resilience but also national energy supply and price stability, as well as foreign exchange savings through import substitution.
“This is not just an energy project, but part of the economic transformation based on domestic resources,” he said.
With its large production scale and support from the state-owned enterprises ecosystem, the Tanjung Enim DME project is expected to become one of the important pillars in driving national energy independence while strengthening the domestic industrial structure.