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Indonesia likely to continue relying on imported fuel for the next 20 years, says former state oil giant director

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JAKARTA, INDONESIA — An oil and gas expert predicted that Indonesia will have to rely on imported fuel for the next 20 years due to its limited refineries capacity and declining crude oil output.

In an interview with CNBC Indonesia on 23 August, Mr Ari Soemarnoformer director of state-owned oil firm PT Pertamina from 2006 to 2009said that Indonesia’s refineries’ capacity stands at one million barrels per day.

“In my opinion, we cannot avoid fuel and LPG import. That’s the reality. Our oil and gas infrastructure is stagnant at one million barrels per day.

“Our crude oil production does not increase. It is stuck in 650,000 barrels per day. If we add fuel production by increasing the capacity of our refineries, we still have to import crude oil. That will not affect our trade balance,” Arie stated.

Secretary-General of the National Energy Council (DEN), Mr Djoko Siswanto echoed Mr Arie’s statement, adding that Indonesians’ need for fuel continues to rise due to the increase in the number of vehicles.

“The consumption of fuel has risen, as the population is growing and the numbers of vehicles are increasing.

“However, we have successfully overcome the solar import by B30 (the government’s policy that requires the use of 30 per cent blended biodiesel). We still import fuel, crude oil, and liquefied petroleum gas (LPG),” he said in the interview along with Mr Arie.

The number of vehicles in Indonesia increased 5.3 per cent to 133,617,012 in 2019 — up from 126,508,776 in the previous year, the Statistics Agency (BPS) stated.

Previously, Minister of Energy and Mineral Resources, Mr Arifin Tasrif stated in April that the government is planning to stop importing fuel and LPG in 2030.

“In our national strategy, we are planning to stop importing fuel and LPG in 2030,” Mr Arifin said.

To divest from imported fuel, Indonesia will need thousands of trillion to boost refineries’ capacities and energy transition such as coal conversion and gas infrastructure, Mr Arie said in an interview with CNBC Indonesia on 29 April.

“Investment in the oil and gas plus coal sectors, however, proves to be challenging at present, because foreign investors are seeking guaranteed margins that can support their profit.

“Foreign investors are now considering environmental factors such as carbon emissions and energy transition aimed at reducing the impact of climate change,” Mr Arie said.

Indonesia continues its effort to reduce fuel imports by focusing on the development of refineries through The Refinery Development Master Plan (RDMP)a revitalisation project of five existing refineries in Balongan in West Java, Cilacap in Central Java, Dumai in Riau, Balikpapan in East Kalimantan, and Plaju in South Sumatera.

PT Pertamina is partnering with Russia’s Rosneft to build a new refinery in Tuban, East Java. The refinery is expected to produce 300,000 barrels per day.

Before being a net importer of oil in 2003, Indonesia was once one of the world’s largest oil-producing countries.

According to data from BP World Statistics in 2012, Indonesia’s oil output reached 1.6 million barrels per day in 1977.

Two energy expertsBisman Bhaktiar from The Center for Energy and Mining Law Studies (PUSHEP) and Ucok Sigalingging, a consultant at Pertamina who used to work for a multinational oil giant PT Chevrontold TOC why Indonesia turned to be an oil importer.

In addition to the country’s limited refinery capacity, which forces it to rely on Singapore’s refineries, Indonesia’s ageing oil fields are among the reasons behind the nation’s reliance on imported oil.

“The solution is to export crude oil … On the other hand, we import fuel. The technical reason is not all domestic refineries can process all types of crude oil.

“The other reason is the oil mafia, who benefits from the import of oil,” both Bisman and Ucok explained in an interview with TOC.

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Civil Society

EU urged to designate Sarawak as ‘high risk‘ under anti-deforestation law

A coalition of environmental and Indigenous groups has called on the EU to designate Sarawak as high risk under its anti-deforestation law. Sarawak’s extensive deforestation and Indigenous rights violations pose serious risks, prompting calls for stricter EU import checks on timber and palm oil products from the region.

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Logging companies often illegally cut roads into forests on indigenous land (© Rettet den Regenwald / Mathias Rittgerott)

A coalition of environmental, human rights, and Indigenous organizations is urging the European Union (EU) to classify Malaysia’s Sarawak state as “high risk” under its new anti-deforestation regulation. Sarawak, home to millions of hectares of ancient rainforests, faces severe deforestation risks and violations of Indigenous peoples’ rights, according to a joint assessment by groups including Human Rights Watch, RimbaWatch, and SAVE Rivers.

The call to action comes ahead of the EU’s pending decision to categorize regions based on their deforestation risks under the new law.

The EU Deforestation-Free Products Regulation (EUDR), set to be enforced from January 2025, aims to curb the import of commodities like timber and palm oil linked to deforestation and human rights violations.

Sarawak’s history of deforestation, especially for timber and oil palm plantations, makes it a significant concern. A high-risk designation under the EUDR would lead to stricter import checks and increased due diligence requirements for EU companies dealing with products from Sarawak.

Land Rights Violations and Deforestation Concerns

The coalition’s analysis highlights Sarawak’s controversial land laws, which undermine Indigenous land rights while promoting commercial exploitation of the state’s forests.

According to Luciana Téllez Chávez, senior environment and human rights researcher at Human Rights Watch, Sarawak’s land code places “insurmountable obstacles” on Indigenous communities’ ability to gain legal recognition for their ancestral lands.

These laws allow companies to operate with impunity, often disregarding Indigenous land claims. The coalition argues that Sarawak’s record justifies a “high risk” classification, which would necessitate increased oversight of timber and palm oil imports into the EU.

Sarawak’s ambitious plans to expand industrial timber plantations, aiming to establish one million hectares by 2025, are another point of concern.

Achieving this goal would require converting over 400,000 hectares of naturally regenerating forests between 2022 and 2025. This trend poses a significant threat to biodiversity and the rights of Indigenous peoples.

Deficiencies in Certification and Transparency

Despite Sarawak’s reliance on the Malaysian Timber Certification Scheme (MTCS), civil society organizations have flagged significant flaws in the program.

Local activists argue that MTCS does not adequately protect Indigenous rights or prevent deforestation. Celine Lim, managing director of SAVE Rivers, emphasizes that logging continues on Indigenous lands without proper consultation or consent, further eroding trust in certification standards.

Additionally, Sarawak’s opaque land management practices hinder transparency. The state has not made available comprehensive data on Indigenous lands or disclosed the locations of leases granted to logging and palm oil companies.

This lack of transparency prevents Indigenous communities and civil society from holding companies and the government accountable.

EU’s Role in Enforcing Sustainable Practices

Under the EUDR, the European Commission will classify regions as “low, standard, or high risk” by the end of 2024.

A high-risk designation for Sarawak would mandate EU member states to triple their customs checks on imports of wood and palm oil products from the region.

EU-based companies would also need to conduct more rigorous checks to mitigate environmental and human rights violations linked to these products. This process would require close collaboration between the EU and Malaysian authorities to reduce risks and ensure compliance with the new regulation.

Sarawak’s timber and palm oil exports to the EU have been significant in recent years. According to a Sarawak government report, the state exported at least MYR 37.3 million (€7.8 million) worth of timber to EU countries like the Netherlands, France, and Greece in 2023.

The EU remains the third-largest market for Malaysian palm oil exports, underscoring the importance of Sarawak’s compliance with international sustainability standards.

Challenges in Malaysian Government Response

The Malaysian government has pushed back against the EUDR, criticizing its definitions and monitoring processes.

The government contends that industrial timber plantations, which involve replacing natural forests with single-species plantations, should not be classified as deforestation. Critics argue that this stance overlooks the environmental degradation and loss of biodiversity associated with such practices.

Adam Farhan, director of RimbaWatch, warns that Malaysia may be attempting to bypass EU restrictions by downplaying the scale of deforestation in timber plantations. Farhan stresses the need for stringent due diligence on Malaysian forest-risk commodities.

The federal government has mandated that palm oil plantations established after 31 December 2019, on deforested land, cannot receive sustainable certification under the Malaysian Sustainable Palm Oil (MSPO) standard.

However, enforcement remains uncertain, as states hold jurisdiction over land and forest administration. Civil society groups are urging the Malaysian government to strengthen its oversight mechanisms and improve its sustainability certification programs to meet EU requirements.

International and Local Advocacy for Reform

In May 2024, the coalition of civil society organizations submitted recommendations to Malaysia’s federal Plantation and Commodities Ministry, urging reforms to align with international human rights and environmental standards.

Key recommendations include incorporating the United Nations Declaration on the Rights of Indigenous Peoples into federal legislation and introducing laws to prevent strategic lawsuits against public participation (SLAPPs), which are often used to silence critics of deforestation practices. The government has not yet responded to these calls.

As the EU moves forward with its anti-deforestation law, the decision to designate Sarawak as high risk could have far-reaching implications for Malaysia’s timber and palm oil industries. Environmental groups argue that strong enforcement of the EUDR is necessary to prevent further forest loss and protect Indigenous communities’ rights in Sarawak.

 

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Environment

Japanese scientists find microplastics are present in clouds

In Japan, researchers confirm microplastics in clouds, impacting climate. Airborne microplastics, 7.1 to 94.6 micrometers in size, found in cloud water, potentially affecting rapid cloud formation and climate systems.

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WASHINGTON, UNITED STATES — Researchers in Japan have confirmed microplastics are present in clouds, where they are likely affecting the climate in ways that aren’t yet fully understood.

In a study published in Environmental Chemistry Letters, scientists climbed Mount Fuji and Mount Oyama in order to collect water from the mists that shroud their peaks, then applied advanced imaging techniques to the samples to determine their physical and chemical properties.

The team identified nine different types of polymers and one type of rubber in the airborne microplastics — ranging in size from 7.1 to 94.6 micrometers.

Each liter of cloud water contained between 6.7 to 13.9 pieces of the plastics.

What’s more, “hydrophilic” or water-loving polymers were abundant, suggesting the particles play a significant role in rapid cloud formation and thus climate systems.

“If the issue of ‘plastic air pollution’ is not addressed proactively, climate change and ecological risks may become a reality, causing irreversible and serious environmental damage in the future,” lead author Hiroshi Okochi of Waseda University warned in a statement Wednesday.

When microplastics reach the upper atmosphere and are exposed to ultraviolet radiation from sunlight, they degrade, contributing to greenhouse gasses, added Okochi.

Microplastics — defined as plastic particles under 5 millimeters — come from industrial effluent, textiles, synthetic car tires, personal care products and much more.

These tiny fragments have been discovered inside fish in the deepest recesses of the ocean peppering Arctic sea ice and blanketing the snows on the Pyrenees mountains between France and Spain.

But the mechanisms of their transport have remained unclear, with research on airborne microplastic transport in particular limited.

“To the best of our knowledge, this is the first report on airborne microplastics in cloud water,” the authors wrote in their paper.

Emerging evidence has linked microplastics to a range of impacts on heart and lung health, as well as cancers, in addition to widespread environmental harm.

— AFP

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