Parliament Highlights Indonesia's 75 Per Cent LPG Import Dependency

Indonesia’s dependence on liquefied petroleum gas (LPG) imports has prompted the government to accelerate development of dimethyl ether (DME) as an alternative domestic fuel. National LPG consumption currently reaches approximately 8 million tonnes per year, with roughly 75 per cent of demand still met through imports.

Data from the Central Statistics Agency (BPS) shows that Indonesia’s LPG import value in 2024 reached USD 3.8 billion, equivalent to Rp64.1 trillion. This substantial dependency makes domestic LPG supply vulnerable to fluctuations in global energy markets.

DME development has been included on the national downstream coal processing priority projects list and is scheduled to commence this year under the coordination of the Danantara Investment Management Agency (BPI). MIND ID and Pertamina are collaborating to accelerate coal downstream processing into various alternative energy products including Synthetic Natural Gas (SNG), Dimethyl Ether (DME), and methanol. Pertamina serves as both the offtaker and infrastructure distribution aggregator to ensure downstream products reach consumers and industry.

Bambang Patijaya, chairman of Commission XII of the House of Representatives, views DME development as a strategic step to strengthen national energy resilience amid global geopolitical uncertainty. He noted that conflict in the Middle East could disrupt oil and gas distribution from the Persian Gulf region via strategic shipping lanes such as the Strait of Hormuz. Currently, the United States is Indonesia’s primary LPG supplier, accounting for approximately USD 2.03 billion or roughly 53 per cent of total imports, whilst Qatar contributes approximately 11 per cent and the United Arab Emirates around 10 per cent.

“When geopolitical escalation in the Middle East disrupts oil and gas supply from the Persian Gulf region passing through the Strait of Hormuz, this becomes a strong reason why we must pursue coal downstream processing into DME,” Patijaya stated on 10 March 2026.

He added that DME development could also open new markets for low-calorie coal. Indonesia possesses coal resources of approximately 97.96 billion tonnes with reserves reaching 31.95 billion tonnes. The majority of these reserves are low-calorie coal, which has historically possessed relatively low economic value in export markets.