Indonesia Inaugurates $7.4bn Balikpapan Refinery Upgrade to Boost Energy Independence

SEATTLE (Oil Monster): Indonesian President Prabowo Subianto on Monday inaugurated Pertamina’s upgraded Balikpapan refinery in East Kalimantan, marking a significant expansion of the nation’s oil refining capacity and a strategic step toward energy self-sufficiency.

The $7.4 billion upgrade, managed by Kilang Pertamina Internasional, has lifted the refinery’s processing capacity to 360,000 barrels per day (bpd) from 260,000 bpd, making it the largest refinery in Indonesia. Energy Minister Bahlil Lahadalia said the expansion will substantially curb dependence on imported fuels.

ALSO READ:

Indonesia Says Venezuela Unrest Unlikely to Impact Global Oil Prices or Trade

Surging Chinese imports of Indonesia oil point to rebranded Iranian crude, traders say

Following the upgrade, the refinery is expected to produce 5.8 billion litres of gasoline annually, potentially cutting gasoline imports to 19 billion litres from 24 billion litres. Higher output, combined with Indonesia’s biodiesel mandate, is also projected to eliminate gas oil imports. Bahlil added that by 2027 Indonesia aims to end jet fuel imports, relying instead on domestic production while continuing crude oil imports.

The modernization, launched in 2019 as a National Strategic Project, includes Euro V–compliant processing units, lower-sulphur fuel capability, and a sharp rise in LPG output to 384,000 tonnes per year. A new petrochemical production unit will add 283,000 tonnes annually, strengthening downstream integration and industrial resilience.