The Role of the Oil and Gas Sector in Maintaining Energy Security and Achieving Net-Zero Emissions
The transition toward clean energy and a net-zero emissions environment has become a global policy direction. However, the oil and gas sector plays a crucial role in achieving these targets while ensuring a stable energy supply. This issue was the key theme of the IPA Convention & Exhibition 2025 (“IPA Convex 2025”), held on May 20–22, 2025, under the theme “Delivering Growth with Energy Resilience in a Lower Carbon Environment.”
In his opening speech, the President of the Republic of Indonesia, Prabowo Subianto, stated that the oil and gas sector remains attractive. However, legal certainty and regulatory simplification are necessary. He also emphasized, “We need oil and gas to survive today while we build a cleaner energy future.”
Indonesia possesses considerable untapped oil and gas reserves, with only 16% of its 128 oil and gas basins explored to date. In response, the government is targeting the opening of 60 new oil and gas working areas (Wilayah Kerja/WK), with a priority on natural gas as a transitional energy source. Natural gas is now a key asset to meet domestic demand and strengthen export capabilities, particularly in the form of LNG (liquefied natural gas).
IPA Convex 2025 featured 216 national and international companies as exhibitors, as well as 112 speakers from around the world in its conference sessions. The event also saw the signing of three new Production Sharing Contracts (PSCs) and over 25 other commercial agreements, indicating growing confidence in Indonesia’s upstream oil and gas prospects.
These developments form the foundation for realizing national energy self-sufficiency, as outlined in President Prabowo’s Asta Cita vision.
While striving for net-zero emissions, the Indonesian government recognizes the need for a balanced use of energy sources, including both new and renewable energy (NRE) and fossil-based energy, such as oil, gas, and coal. This realization stems from the reality that current and future energy demands remain high. To this day, over 60% of the national energy supply still comes from oil and gas. Sectors such as transportation infrastructure, heavy industries, and large-scale power generation remain heavily dependent on fossil fuels.
Efforts to develop renewable energy sources for stable and equitable availability continue despite challenges such as massive infrastructure needs and high investment requirements. Reflecting this situation, oil and gas still serve as essential support during the transition period. This important fact was echoed in one of the IPA Convex 2025 conference sessions: “An energy transition without stable energy will only result in uncertainty.” Therefore, oil, gas, and renewable energy should not be in opposition but instead support each other until renewables can fully meet energy needs.
Additionally, IPA Convex 2025 served as a platform to reaffirm the oil and gas industry’s transformation. Although CCS/CCUS (Carbon Capture and Storage/Carbon Capture, Utilization, and Storage) technologies still face cost-related challenges, many stakeholders are optimistic that CCS will soon become part of a long-term solution for reducing carbon emissions from the oil and gas industry.
Another key focus of the event was the need for policy reform. Investor concerns such as legal certainty, fiscal policies, and expedited licensing are seen as urgent areas for improvement to stimulate increased oil and gas exploration and production. The government responded positively by planning to simplify the permitting process and introduce new fiscal policies for the upstream sector.
In conclusion, with its vast potential, strong investment interest, and government commitment to improving the investment climate, Indonesia’s upstream oil and gas sector is well-positioned to serve as a bridge to a cleaner, more sustainable energy future. Moving forward, close collaboration between the government and both domestic and international industry players will be key to the sector’s success.
