Indonesia Plans to Build Oil Storage Tank Project with Investor Already in Place: Bahlil
Jakarta — Indonesia’s Minister of Energy and Mineral Resources (ESDM), Bahlil Lahadalia, has announced that plans for building new oil storage tanks in Indonesia have already attracted investor interest. Indonesia aims to increase oil storage capacity from the current 21-25 days to 3 months of supply.
Bahlil stated that the storage development cannot rely solely on the state budget (APBN). From Indonesia’s overall economic activity, APBN contributes only approximately 16%, with the remainder coming from the private sector. Consequently, the government must involve private companies to co-invest.
“This already has investors. We build this nation, and our total GDP contribution from APBN is not more than 16%. The rest is private. So we must also engage the private sector to build without using APBN funds,” Bahlil said during the ESDM Ministry’s Bukan Abuleke podcast on Wednesday (11 March 2026).
According to Bahlil, companies such as Pertamina or others requiring oil supplies, for instance for refinery operations, could draw oil from the new storage facility.
The transactions will be conducted in rupiah. The objective is to prevent Indonesia from expending foreign currency abroad, thereby protecting the country’s foreign exchange reserves.
“Why? So our foreign currency does not leave. The country will no longer expend foreign currency,” he added.
However, the government is also allowing private companies building the storage facility to purchase crude oil from abroad. This oil would then be stored and marketed domestically, which is feasible given Indonesia’s substantial oil requirements.
“But the private party building the storage, we also give them space to buy crude from overseas, but the market cap is domestic. Why? Because we need 1 million barrels per day. So this is an opportunity that we offer as an incentive to the private sector for investment,” he stressed.
As noted, in mid-2025, Bahlil, who also chairs the National Downstream Integration and Energy Security Task Force, formally submitted the pre-feasibility study documentation for national downstream integration and energy security projects to the Daya Anagata Nusantara (Danantara) Investment Management Agency (BPI).
On that occasion, Bahlil revealed that at least 18 projects were ready to enter the pre-feasibility stage. The total investment value of these 18 projects reached US$38.63 billion, equivalent to 618.3 trillion rupiah.
“We have around 18 projects that are ready for pre-FS, Chief of Danantara, with total investment of US$38.63 billion or equivalent to 618.3 trillion rupiah. This is outside the special automotive battery ecosystem that we will build according to the President’s direction in the plenary session,” Bahlil said during a press conference on Tuesday (22 July 2025).
Bahlil detailed that of the 18 projects, there are eight downstream integration projects in the mineral and coal sectors, two projects concerning energy downstream integration, two energy security projects, three agricultural downstream projects, and three marine and fisheries downstream projects.
Among the 18 downstream integration projects is a refinery and oil storage tank project with an estimated investment requirement of 232 trillion rupiah. This comprises a refinery project valued at 160 trillion rupiah, absorbing 44,000 workers, and an oil storage tank project valued at 72 trillion rupiah, absorbing 6,960 workers.
The refinery and oil storage tank development project will be distributed across 18 regions, including Lhokseumawe, Sibolga, Natuna, Cilegon, Sukabumi, Semarang, Surabaya, Sampang, Pontianak, Badung (Bali), Bima, Ende, Makassar, Dongala, Bitung, Ambon, North Halmahera, and Fakfak.