Indonesia's Minister of Energy and Mineral Resources, Bahlil Lahadalia, announced plans to construct a strategic oil storage facility on an island near Singapore. The project aims to bolster the nation's energy sovereignty in line with President Prabowo's vision. "We will build storage with a capacity for 30–40 days of supply," Bahlil stated in Jakarta on Wednesday. The facility, capable of accommodating various types of oil, is expected to enable Pertamina to procure fuel at lower costs. This initiative stems from Indonesia's heavy reliance on Singapore for fuel imports, which account for 60% of its total.
Despite Singapore lacking domestic oil resources, it serves as a major fuel supplier to Indonesia. Bahlil emphasized that this reliance poses a strategic vulnerability, especially in the event of geopolitical conflicts, as Indonesia's current storage capacity covers only 21 days of reserves. To reduce annual energy import costs of approximately IDR 500 trillion, the government also seeks to enhance domestic oil production. Bahlil highlighted the potential of optimizing idle oil wells, which could significantly boost the country's production. Of the 44,900 oil wells in Indonesia, 16,600 are inactive, and around 5,000 are identified for immediate reactivation. This strategy aligns with broader efforts to secure energy independence and reduce reliance on imports, ensuring stability in both economic and geopolitical contexts.
