Indonesian minister denies outright LNG export ban, update likely in 2-3 months

Indonesia has no plans for an outright ban on LNG exports but will prioritize domestic energy security in the future, Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan said June 6 on the sidelines of the Ecosperity Week 2023 conference in Singapore.

"We don't have a plan to ban LNG export, but we look at our national interest first, you know, because (if) we export something when there is a shortage, I think is unfair," said Pandjaitan in response to questions about reports of a proposal that would limit the country's LNG exports.

"It will be studied carefully. We'll see. Sometime ... maybe in two, three months, we can come up with an announcement," he added.

Last week, a spokesman for the government regulator had said Indonesia's existing LNG contracts will remain unchanged despite a potential plan to curb future exports of the fuel. The spokesman did not elaborate on the proposal but confirmed that Indonesia will prioritize domestic consumption instead of exports, adding that any decisions will be in line with the country's gas demand and supply balances.

Meanwhile, Pandjaitan said Indonesia has been pushing toward meeting its net-zero emissions goal by 2060, with the target likely to be met as early as 2055 or even earlier based on the country's current progress.

Potential carbon sink and CCS hub

Earlier during the conference, meanwhile, Pandjaitan said June 5 that Indonesia has a large potential for nature-based solutions carbon sink, which can absorb emissions naturally.

Indonesia with a land area of 1.91 million sq km is estimated to potentially mitigate 1,860 mt of CO2 emissions each year through nature-based solutions like forests and wetlands, government data showed.

The country can also store about 400 gigatons of CO2 in its onshore and offshore oil and gas reservoirs, as well as saline aquifers, which make it attractive to investments with a more comprehensive low-carbon ecosystem, including carbon capture and storage, added Pandjaitan.

As a hub, Indonesia can take in carbon from regional neighbors like Japan, South Korea, Taiwan and Singapore, he said, adding that the CCS infrastructure could also be used to distribute alternative fuels in the future.

The country is also "carefully" studying nuclear as a renewable energy source, with preliminary studies assigned with the US and South Korea, he added.

"We don't want to deploy nuclear power in the ring of fire, that's number one. We'll also look at like maybe Kalimantan, maybe like some island not in the ring of fire," said Pandjaitan.

More funding, collaboration

Although Indonesia is already on track to produce about 3.4 GW of geothermal power and 3 GW of hydropower by 2037, green projects, which remain expensive, have limited funding, Pandjaitan said during the conference, appealing for more concrete actions globally through funding and investments to tackle climate change.

The country received an initial $20 billion injection under the Just Energy Transition Partnership, which is financed by the US, Japan and various countries to retire coal plants and build up renewable projects, S&P Global Commodity Insights reported previously.

Pandjaitan said that Indonesia contributes only 2.3 tons of emissions per capita, which is lower than the baseline of 2.5 tons per capita and vastly lower than other larger countries like the US. Other countries must also take steps to reduce emissions, he added.