Government to Provide Subsidies for CNG

Energy and Mineral Resources Minister Bahlil Lahadalia stated that the government will continue to provide subsidies for the implementation of compressed natural gas (CNG), or compressed natural gas. The government had previously planned to replace 3kg liquefied petroleum gas (LPG) with CNG. “I assure you that subsidies will still be necessary for the people,” Bahlil said, as quoted from Antara on Wednesday, 6 May 2026. Bahlil mentioned that the provision of subsidies aligns with President Prabowo Subianto’s instructions to prioritise the interests of the people. Although still using subsidies, Bahlil estimated that replacing 3kg LPG with CNG could save up to 30% in subsidies. Meanwhile, regarding the CNG distribution plan, Bahlil said it is only slightly different from LPG distribution. “This is just a replacement; one is LPG, the other is CNG. With CNG, it does not drain foreign exchange abroad. LPG drains foreign exchange abroad because we do not have the raw materials C3 and C4 (for LPG),” Bahlil stated. Currently, the government is not only trialling the production of type 4 cylinders for CNG, or cylinders intended for 3kg CNG. In parallel, the government is also studying the selling price of 3kg CNG. “Pray (that the price) is below 3kg LPG. At least the same (price). At least the same,” Bahlil said. Furthermore, he explained that CNG is not a new technology as it has been used in the hospitality sector, restaurants, and the free nutritious meal programme (MBG). However, its use so far has been limited to large-capacity cylinders above 10 to 20 kilograms. Currently, preparations are underway for small-sized CNG cylinders similar to 3kg LPG. This is because CNG has different characteristics from LPG. CNG has a pressure of around 250 bar, stronger than LPG which has a pressure of 5-10 bar. The difference in gas pressure is what requires the 3kg gas cylinder design to be adjusted. This is because it directly impacts safety factors. The trial of small-sized CNG cylinders will take approximately 2-3 months. Bahlil added that if the trial results are deemed feasible, the government will open opportunities for a gradual conversion from LPG to CNG for household needs. Director General of Oil and Gas of the Ministry of Energy and Mineral Resources Laode Sulaeman projects that CNG can replace 3kg elpiji starting this year to reduce energy import dependence. In the future, CNG for households will be implemented in major cities on Java Island before being rolled out simultaneously across Indonesia. “Gradually in major cities on Java first. This year,” Laode said.