Indonesia’s Ministry of Energy and Mineral Resources (ESDM) has published the specific criteria determining which domestic industries are eligible to purchase liquefied natural gas (LNG) at the capped price of US$13 per million British thermal units (MMBtu).
The guidelines clarify the implementation of the government’s recent policy shift, which aims to insulate key manufacturing sectors from volatile global energy markets while managing state-owned utility margins.
The price cap represents a significant intervention in the domestic energy market, where LNG prices had previously tracked international benchmarks more closely.
By setting a fixed ceiling, the government seeks to provide cost certainty for energy-intensive industries, including fertilizers, cement, and power generation, which have faced margin pressure from elevated global gas prices.
The ESDM’s detailed criteria are expected to define the threshold for eligibility, likely focusing on strategic sectors critical to national infrastructure and food security.
PT Perusahaan Gas Negara (PGN), the state-owned gas distributor, has confirmed its readiness to execute the directive.