Amid high liquefied petroleum gas (LPG) consumption among the Indonesian public, the market structure of this energy commodity remains dominantly controlled by PT Pertamina Patra Niaga (PPN). Pertamina's Commercial & Trading subholding controls over 80 percent of the national LPG supply, spanning from import channels to distribution to end consumers.
Nevertheless, national energy security in this sector still faces major challenges due to dependence on foreign supply. Indonesia reportedly has to import around 75 to 80 percent of domestic LPG needs due to limited domestic production capacity, which only ranges around 1.96 million tons, while annual consumption is projected to surge to nearly 10 million tons by 2026.
Pertamina Patra Niaga's business tentacles in the non-subsidized segment recently caught the attention of regulators. In March 2025, the Business Competition Supervisory Commission (KPPU) conducted an investigation into alleged monopolistic practices after suspecting that non-subsidized LPG profit margins were excessively high, reaching IDR 1.5 trillion, thereby driving consumer migration to subsidized LPG.
Besides Pertamina Patra Niaga, domestic supply is supported by several strategic producers. In the state-owned camp, there are PT Pertagas, PT Perta-Samtan Gas—which operates one of the largest refineries in South Sumatra—and PT Badak NGL in Bontang. Meanwhile, in the private sector, significant contributions come from PT ESSA Industries Indonesia Tbk with a refinery in Palembang and ArsyGas in Gresik.
The LPG import landscape is projected to undergo a shift following the issuance of Presidential Regulation (Perpres) Number 26 of 2026. This regulation, signed by President Prabowo Subianto, gives a new mandate to the Center for Oil and Gas Testing (Lemigas) as a Public Service Agency (BLU) to also import crude oil, fuel, and LPG to maintain national energy reserve stability.
