Not Exports, Indonesian Government Lobbies Oil Contractors to Supply Domestic Market

Jakarta, CNBC Indonesia - The Special Task Force for the Implementation of Upstream Oil and Gas Business Activities (SKK Migas) is negotiating with Oil and Gas Business Contract Contractors (KKKS) to supply their oil production domestically.

SKK Migas Head Djoko Siswanto stated that this policy aims to encourage domestic oil and gas companies to allocate their production for processing in local refineries. Although there is no formal export ban from the government yet.

“This year, there is no policy; this year, no export recommendations (for crude oil) are given except for those already contracted,” Djoko explained when met at the Ministry of Energy and Mineral Resources office in Jakarta, quoted on Tuesday (7/4/2026).

For oil companies that already have export contracts, the government, if necessary, will negotiate with the relevant contractors to activate shipment delay clauses so that the oil supply can first be absorbed by PT Pertamina (Persero).

Djoko cited the ongoing negotiation process with PT MedcoEnergi as an example. However, the contractor requires a strong legal basis in the form of an official government letter to delay their export obligations without incurring penalties from buyers.

“Alhamdulillah, for ExxonMobil, the KKKS part is already 100% processed domestically, that’s possible. Medco is just waiting for the letter from the minister. I actually already sent a letter stating that Medco’s export contract with the foreign buyer has a clause that if the government needs it, the shipment can be delayed to the following year. One more with Texcal. We haven’t discussed Texcal yet,” Djoko emphasised.