Indonesia Drafts Rules to Boost Unconventional Oil, Gas

RRI.CO.ID, Jakarta - The Ministry of Energy and Mineral Resources (ESDM) has accelerated plans to develop Indonesia’s unconventional oil and gas (UOG) sector, drafting new policies to strengthen support for state-owned energy giant PT Pertamina (Persero) as the sector’s initial developer.

“We are reviewing several regulations to enable us to accelerate UOG development,” said ESDM Director General of Oil and Gas, Laode Sulaeman, on the sidelines of the IPA Convex in Tangerang, Banten, on Wednesday, May 21, 2026.

Laode explained that the government aims to finalize the new regulations this year in the form of a ministerial decree. While regulations already exist, he said revisions are needed to provide stronger incentives and support for Pertamina in developing UOG.

The ministry has also held discussions with Pertamina regarding fiscal and regulatory support. “There are incentives and streamlining measures. We support those,” Laode said.

He emphasized that UOG will become a mainstay of Indonesia’s energy production in the future, as it has in the United States. “We see that their largest production comes from UOG. We want that too,” he added.

Deputy President Director of Pertamina, Oki Muraza, noted that Indonesia has up to 11.3 billion barrels of oil in place (BBO) for UOG development. He said this represents a fresh opportunity amid the end of the “easy energy” era, where conventional oil and gas resources are increasingly limited.

Oki stressed that Indonesia’s challenge is to establish competitive fiscal and regulatory frameworks to support unconventional oil and gas wells. Pertamina, he added, plans to collaborate with industry partners and develop human resources to build a UOG ecosystem similar to the Permian Basin in the United States. ***