Pertamina Holds Oil and Gas Output While Expanding Geothermal to 1,932 MW
Indonesia's state energy company is running legacy and low-carbon businesses in parallel, but the country's renewable mix remains well short of government targets.
Pertamina Geothermal Energy manages 1,932 megawatts of installed geothermal capacity, its executive director Baron said, comprising 727 MW operated directly and 1,205 MW through joint operation contracts — a figure representing roughly 70% of Indonesia's total installed geothermal base. The disclosure, reported by Asian Power on Monday (2026-09-14), came alongside confirmation that PT Pertamina (Persero) is holding oil and gas production steady while simultaneously building out its low-carbon portfolio to meet domestic energy demand.5
Indonesia's renewable energy mix stood at 17.3% in the first half of 2026, against a government target of 30% by 2034, according to Ministry of Energy and Mineral Resources data. That gap — nearly 13 percentage points — sets the frame for what Pertamina is being asked to do.5
The dual mandate is not new. Pertamina's chief executive has described the company's strategy as maintaining core oil and gas output while accelerating decarbonisation through what the company calls innovative energy transition solutions. Danantara Indonesia, the sovereign fund that owns 99% of Pertamina's Series B shares, holds the company to both objectives, with the Indonesian government retaining special rights through a single Series A share.1
On the geothermal side, the operational logic is becoming more precise. Pertamina Geothermal Energy is designing the 55-megawatt Lumut Balai Unit 3 plant using performance data drawn from existing facilities, a deliberate attempt to build reliability into the asset before it is commissioned rather than correcting problems after the fact. That approach matters in a country where grid reliability expectations are rising faster than capacity additions.3
Still, Indonesia faces a broader infrastructure problem that geothermal alone cannot solve. The country has secured turbine supply for only 200 MW of a planned 8.4 GW gas power capacity pipeline by 2030 — the lowest proportion among Southeast Asian nations, according to Hellenic Shipping News data published in August (2026-08-09). Equipment constraints, not ambition, are slowing progress on the gas side.4
That context matters for how Pertamina's oil and gas production stance should be read. Holding output steady is not simply a balance-sheet decision; it reflects the physical reality that Indonesia cannot yet replace thermal generation fast enough to reduce dependence on hydrocarbons. Renewables at 17.3% of the mix leave substantial room for gas and oil to remain essential to system stability, whatever the 2060 net-zero target implies on paper.5,4
Crude prices offer some comfort for the economics. ICE Brent front-month was trading at $107.44 per barrel as of 04:47 UTC on Monday (2026-09-14), down 0.44% on the session, while JKM Asian LNG was quoted at $24.88 per MMBtu at the same time. Neither level creates immediate pressure to curtail upstream spending.5
The sustainability report framing — energy resilience, affordability, environmental sustainability — reflects Jakarta's political constraints as much as Pertamina's corporate strategy. Indonesia cannot afford to sacrifice supply security for decarbonisation optics, and Pertamina's role as the dominant domestic producer means it absorbs that tension directly.2
What the packet does not resolve is how Pertamina intends to close the gap between 17.3% and 30% renewable penetration by 2034 without a material acceleration in capacity additions. The Lumut Balai Unit 3 plant adds 55 MW. The existing geothermal base sits at 1,932 MW. The arithmetic requires either a sharp increase in project delivery pace or a downward revision to the government's target timeline — and neither outcome is yet signalled in the available disclosures.3,5
The more immediate indicator for energy traders is whether the turbine supply bottleneck for gas power — currently covering only 200 MW of a planned 8.4 GW pipeline — begins to ease. If it does not, Indonesia's gas demand growth may undershoot regional forecasts, with implications for LNG procurement volumes and JKM spot pricing that extend beyond Pertamina's own balance sheet.4