Indonesia to Build Oil Storage Tanks in Sumatra
The government plans to build oil storage tanks in Sumatra to strengthen national energy resilience, particularly amid rising global geopolitical tensions such as the Iran-Israel conflict involving the United States.
Energy and Mineral Resources Minister (ESDM) Bahlil Lahadalia said the storage facility is important because Indonesia’s current national oil reserve capacity remains limited.
Currently, Indonesia’s oil storage capacity can only hold around 20-25 days of demand. Therefore, the government is targeting a storage solution that exceeds that capacity.
‘The storage must indeed be built first. For a minimum of three months. If we import a lot, where do we put it? That is the reality, not anyone’s fault,’ Bahlil said at a press conference at the Ministry of Energy and Mineral Resources, quoted on Wednesday (4/3/2026).
According to Bahlil, the government aims for the feasibility study (FS) stage to determine whether the oil storage tank project is feasible to build to be conducted this year.
‘FS is underway; the target is to carry it out this year. The location is in Sumatra—do not ask me for details,’ he said.
Furthermore, Bahlil assessed that the storage tanks are a priority before constructing new refineries. ‘Our fuels are in refineries. Our refineries up to RON 98 are built domestically. If crude is available, then only the refineries need to be built,’ he said.
As is known, previously the administration of President Prabowo Subianto planned the construction of refineries and oil storage tanks in various regions, ranging from Lhokseumawe in Aceh to Fakfak in West Papua.
This followed the handover of 18 documents for a pre-feasibility study (pra-FS) related to the downstream project from the Downstream Task Force, chaired by Energy and Mineral Resources Minister Bahlil Lahadalia, to the Chief Executive Officer of the Investment Management Agency (BPI) Daya Anagata Nusantara (Danantara) Rosan Roeslani.
Based on briefing materials from the Ministry of Energy and Mineral Resources, the project is listed among downstream priority and national energy resilience projects with a total investment of Rp 232 trillion. The package comprises a refinery project worth Rp 160 trillion employing around 44,000 workers, and an oil storage tank project worth Rp 72 trillion with employment absorption of 6,960.
The refinery and oil storage tank projects are planned to be spread across 18 regions, including Lhokseumawe, Sibolga, Natuna, Cilegon, Sukabumi, Semarang, Surabaya, Sampang, Pontianak, Badung (Bali), Bima, Ende, Makassar, Donggala, Bitung, Ambon, North Halmahera, Fakfak.