JAKARTA, Dec. 12 (Xinhua) — Indonesia aims to halt diesel fuel imports in 2026 as the government accelerates its biodiesel program and boosts domestic refinery capacity, marking a major step toward strengthening energy security and reducing reliance on foreign fuel supplies.
A key measure in this effort is the planned nationwide rollout of B50, a diesel blend containing 50 percent palm-oil-based biodiesel. The government expects to begin introducing B50 in the second half of 2026, building on the country’s longstanding biodiesel mandate and representing its most ambitious shift yet toward renewable energy.
Energy and Mineral Resources Minister Bahlil Lahadalia said the combination of the B50 program and refinery upgrades puts Indonesia in a strong position to eliminate diesel imports next year.
“We are moving forward with the mandatory B50 program and preparing to inaugurate the Balikpapan Refinery Development Master Plan (RDMP). These two factors support our target to stop importing diesel in 2026,” Lahadalia told local media.
The Balikpapan RDMP, one of Indonesia’s largest downstream energy investments, is central to this transition. Once fully completed, the refinery will increase its processing capacity by 100,000 barrels per day to 360,000 barrels per day. It is operated by PT Kilang Pertamina Balikpapan, a subsidiary of PT Kilang Pertamina International.
The upgraded capacity is expected to significantly boost domestic fuel production, reduce diesel import needs, and enhance national fuel resilience.
Indonesia has long relied on imported diesel for transportation, power generation, and industrial activities. The government has sought for years to curb this dependency, particularly during periods of heightened global oil prices.
The B50 policy further advances Indonesia’s use of biodiesel made from fatty-acid methyl ester (FAME), largely derived from crude palm oil. As one of the country’s key export commodities, palm oil plays a crucial role in supporting farmer incomes, strengthening downstream industries, and diversifying the national energy mix.
According to the Ministry of Energy and Mineral Resources, the biodiesel program saved Indonesia 673.73 trillion rupiah (about 40.7 billion U.S. dollars) in foreign exchange between 2020 and 2025 by reducing fossil diesel imports and increasing domestic palm-oil utilization. The program also created jobs across the plantation and processing sectors.
Lahadalia said the economic gains will expand further once B50 is fully adopted. In 2026 alone, the policy is expected to save 179.28 trillion rupiah (about 10.84 billion U.S. dollars) in foreign exchange.
Indonesia currently enforces a nationwide B40 biodiesel mandate. The shift to B50 will place the country among the world’s leading adopters of large-scale biodiesel use and reinforce its role as a major producer of sustainable palm-based energy.
