MedcoEnergi's 'Dual Track' Strategy: Oil & Gas Accelerated, Energy Transition Continues

Medco Energi Internasional Tbk (MedcoEnergi) has strengthened its ‘dual track’ strategy by accelerating oil and gas development while expanding renewable energy capacity amid global geopolitical uncertainty and volatility in world energy markets. The strategy is executed through increased oil and gas production, expansion of regional gas projects, strengthening the electricity business, and long-term investments in the Middle East.

Senior VP Business Support MedcoEnergi Iwan Prajogi said the company maintains a balance between bolstering fossil energy businesses and developing clean energy to support long-term energy needs. ‘Oil and gas production in Q1 2026 rose significantly compared to the same period last year. All development projects are on schedule,’ Iwan said in the discussion session ‘MedcoEnergi Today: Value. Focus. Growth.’ at the IPA Convex 2026 event in Jakarta, Wednesday (20/5/2026).

In Q1 2026, MedcoEnergi’s oil and gas production reached 170 mboepd, an 18 percent increase from the same period last year. The rise forms part of the company’s efforts to guarantee domestic energy supply amid rising energy demand to support economic growth.

In the oil and gas sector, MedcoEnergi is accelerating a number of strategic projects domestically and abroad. In South Sumatra, the Corridor PSC is now operating fully under 70 percent ownership. The Sakakemang PSC is moving toward a final investment decision (FID) in Q3 2026, with first production targeted for 2027. In Sulawesi, the Senoro Phase 2A project is expected to be fully operational by mid-2026.

‘Five decades of Indonesia’s energy partnership have been a crucial foundation for moving into the next era of growth. MedcoEnergi remains committed to playing a role through measured, reliable project development that supports national energy resilience,’ said Iwan.

Regional expansion also continues. The Bualuang Phase-1 in Thailand is scheduled to start producing in Q2 2026, while the operatorship of the Cendramas PSC in Malaysia will be effective in September 2026. Amid the accelerated development of oil and gas, MedcoEnergi continues to expand its clean energy portfolio. The Ijen Geothermal project is preparing to enter Phase 2 with an additional capacity of 35 MW to reach a total of 70 MW. The company is also developing the Batam IPP toward a capacity of 300 MW and studying the expansion of Sumbawa Solar PV 26 MWp.

Renewable energy now accounts for 26 percent of MedcoEnergi’s total installed capacity. The company targets green energy to rise to 30 percent by 2030 as part of the energy transition strategy.

The strengthening of the oil and gas business also takes place at the international level. The company reiterates its commitment to expanding energy investments in the Sultanate of Oman through 2040, in step with strengthening operations in Karim Small Fields (KSF), Block 60, Block 48, and Block 56.

Chief Executive of MedcoEnergi Hilmi Panigoro said Oman has become one of the company’s most strategic international assets since first entering the Middle East in 2006. ‘Twenty years have taught us one thing: when you build with Oman, you build for the long term,’ Hilmi said at the 20th anniversary of MedcoEnergi in Muscat, Oman, on Sunday (17/5/2026).

Since 2006, MedcoEnergi has operated KSF under a service agreement with Petroleum Development Oman (PDO). The company’s performance in managing mature fields led to the cooperation agreement being extended to 2040.

Over the last two decades, MedcoEnergi has produced more than 110 million barrels of oil in Oman, drilled more than 500 wells, and discovered seven new fields. In 2025, Block 60 posted an average gross production of 67.8 mboepd and peaked at 77.2 mboepd in October. ‘We are not here as a company closing a chapter. We are here as a partner ready to write the next chapter,’ Hilmi said.

MedcoEnergi also holds an approximately five percent participating interest in Block 56, which has entered the development phase for a structured field after the declaration of commerciality in 2024. Appraisal activity in Block 48 continues toward a potential declaration of commerciality.

In the sustainability arena, MedcoEnergi earned an MSCI ESG rating of ‘AAA’ and ranked among the top 11 percent of global Oil & Gas Exploration & Production companies by MSCI. As of March 2026, KSF operations in Oman recorded six years without a lost-time incident (LTI) and surpassed 13 million hours worked without an LTI.

MedcoEnergi targets production of 165-170 mboepd and electricity sales of 4,550 GWh in 2026. The strengthening of the oil and gas business and clean energy is projected to remain the two main pillars of the company to support national energy resilience and long-term regional expansion.