Indonesia has formally commissioned the upgraded Balikpapan oil refinery following a major $7.4 billion modernisation and expansion programme, marking a significant step in strengthening the country’s downstream energy infrastructure.
The inauguration was led by President Prabowo Subianto, who described the project as a strategic asset for improving Indonesia’s fuel security and reducing reliance on imports. With the completion of the upgrade, the refinery’s processing capacity has been increased from 260,000 barrels per day to 360,000 barrels per day, making it the largest refining facility in the country.
Operated by state-owned energy company Pertamina, the Balikpapan refinery upgrade is part of a long-term national initiative to modernise ageing refining assets and improve fuel quality. The expanded facility is now capable of producing higher volumes of gasoline, diesel, aviation fuel and liquefied petroleum gas that meet more stringent environmental and performance standards.
A central element of the project is the integration of advanced conversion units, including a residual fluid catalytic cracking system, which allows the refinery to process heavier crude oils more efficiently and convert them into higher-value products. Additional crude and product storage infrastructure has also been developed to improve operational flexibility and logistics efficiency.
The government expects the expanded refinery to play a key role in narrowing Indonesia’s fuel import gap, supporting domestic demand growth and stabilising supply, particularly during periods of high consumption. The project is also aligned with broader efforts to enhance national energy resilience while supporting economic development in eastern Indonesia.
The commissioning of the Balikpapan upgrade represents one of the largest downstream investments in the country’s energy sector and reinforces Indonesia’s focus on building self-sufficiency through large-scale industrial and infrastructure projects.
