LPG Gas Source Constraints: Pertamina's Strategy to Maintain Energy Resilience

Tanjung Enim, CNBC Indonesia - PT Pertamina (Persero) has acknowledged current limitations in C3 (propane) and C4 (butane) content as sources of gas for processing into Liquefied Petroleum Gas (LPG). Consequently, this poses the main challenge in boosting domestic LPG production. Pertamina’s Director of Strategy, Portfolio, and Business Development, Emma Sri Martini, explained that Indonesia’s natural gas resources have constraints in producing LPG on a large scale. “Our natural resources, particularly from natural gas, have limitations in producing LPG. Our C3 and C4 levels are very low. Therefore, it is indeed very difficult to increase LPG production massively domestically from our natural gas sources,” Emma stated at the groundbreaking ceremony for Phase 2 of the coal-to-Dimethyl Ether (DME) development project in Tanjung Enim, South Sumatra, on Wednesday (29/4/2026). According to Emma, this situation has driven Pertamina to seek other alternative energy sources to replace the current LPG imports of around 7 million metric tons per year. One such initiative is the development of the coal-to-DME downstream project. In addition, Pertamina is optimising various other alternatives, such as household gas networks, utilisation of C1 and C2 natural gas, syngas, and Compressed Natural Gas (CNG). “These are our efforts to maintain energy resilience,” Emma said. Emma views these steps as part of a strategy to strengthen national energy resilience while supporting the goal of energy self-sufficiency. Moreover, she noted that President Prabowo has mandated replacing the 7 million metric tons of LPG imports with domestic energy sources. “We are working on this to achieve energy resilience and ultimately energy self-sufficiency. The President has directed that these 7 million tons of LPG must be substituted for imports through various intervention methods. This is what we are pursuing by optimising our domestic resources to replace those LPG imports,” she clarified. As is known, President Prabowo Subianto recently officiated the start of construction, or groundbreaking, for 13 Phase 2 downstream projects with a total estimated investment of Rp 116 trillion. The groundbreaking ceremony for these 13 downstream projects was held in Cilacap, Central Java, on Wednesday (29/4/2026). Besides Cilacap, the inaugurations were also conducted simultaneously at several locations, including in Tanjung Enim, South Sumatra. One of the projects inaugurated is the coal-to-DME downstream project in Tanjung Enim, South Sumatra. This DME project is being undertaken jointly by three State-Owned Enterprises (SOEs): the Mining SOE Holding MIND ID, PT Bukit Asam Tbk (PTBA), and PT Pertamina (Persero). PTBA’s Director of Downstream and Product Diversification, Turino Yulianto, explained that the project will process 7 million tons of coal into 1.4 million tons of DME, equivalent to 1 million tons of LPG per year. This means the coal-to-DME downstream project will contribute to reducing LPG imports by around 1 million tons per year. As is known, Indonesia still imports about 1 million tons of LPG annually. “Ladies and gentlemen, DME is intended to be absorbed by Patra Niaga, Pertamina—thank you, Ms Emma—for absorbing our product and, God willing, substituting the LPG that has been imported so far. This is a project to strengthen national energy resilience,” Turino stated.