Jakarta. Indonesia is accelerating coal processing into dimethyl ether (DME) and expanding biofuel programs to cut LPG and fuel imports, the head of the SOEs Regulatory Agency (BP BUMN) said on Tuesday.

The government is pushing downstream industry initiatives, particularly by converting coal into gas, to reduce reliance on imported LPG.

“We have begun downstream industrialization programs. There will be DME projects that convert coal into gas, so we can reduce LPG imports,” Dony said at The Forum hosted by B-Universe at Hotel Mulia in Jakarta on Tuesday.

Dony, who also serves as chief operating officer of sovereign wealth fund Danantara, added that the government is optimizing domestic energy resources, including liquefied natural gas (LNG), to strengthen national energy resilience amid geopolitical uncertainty and volatile global energy prices.

He said the government is continuing to transform the business model of state-owned gas firms such as state-owned gas companies Perusahaan Gas Negara (PGN) and Pertagas, shifting their focus toward midstream and downstream operations, including direct gas distribution to households.

In liquid fuels, Indonesia has recorded progress by halting diesel imports through its biodiesel program, moving from B40 toward B50, underscoring the country’s capacity to meet energy demand using domestic resources.

The government is also developing bioethanol from agricultural commodities such as corn and cassava to reduce gasoline imports while supporting the farming sector.

To further strengthen energy security, Indonesia is increasing national reserves by building oil storage facilities and preparing new refinery projects.

“We believe a sustainable country must have strong energy capabilities, and we have abundant resources,” Dony said.

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