The Upstream Oil and Gas Regulatory Task Force (SKK Migas) has reported that local content (TKDN) achievements in government projects as of June 2025 have exceeded the initially set targets.

For national strategic projects (PSN), the TKDN realization stood at 58 percent, well above the government’s 18 percent target, with the year-end outlook is projected at 24.25 percent. In non-PSN projects, the TKDN has reached 59 percent marginally above the 57 percent target, with an outlook of 57.65 percent by the end of the year.

SKK Migas Deputy for Business Support, Eka Bhayu Setta, emphasized the agency’s continued commitment to empowering domestic suppliers and manufacturers.

“Our achievements are not just about meeting numbers,they reflect our long-term dedication to enhancing national industrial capacity,” Eka said as quoted in a statement on Thursday, July 24, 2025.

By mid-2025, total upstream oil and gas procurement contracts had reached US$3.58 billion (Rp 58.7 trillion), comprising US$255 million for PSN projects and US$3.32 billion for non-PSN projects. Of that amount, procurement allocated to domestic vendors totaled US$1.83 billion (Rp 30.1 trillion).

Eka noted that exceeding TKDN targets consistently especially for non-PSN projects where the bar is set at 57 percent is a testament to the sector’s effort to go beyond merely sourcing locally available goods.

“We are also focused on nurturing and empowering local businesses to become reliable players in the upstream supply chain,” he said.

The momentum comes as Indonesia experiences a resurgence in upstream investment, with 2025 projected to be the sector’s most capital-intensive year in the past decade.

“The surge in upstream activity must be matched by stronger domestic support capacity. We are encouraging both new and existing vendors to scale up production and improve quality to meet growing demand,” Eka said.

To support local business participation especially in oil and gas-producing regions SKK Migas has revised its procurement policies by updating PTK 007 and operational guidelines. The new rules aim to fast-track projects, stimulate regional investment, and ensure more equitable participation in the sector’s economic benefits.

Under the revised policy, local companies are now allowed to participate in procurement packages of up to Rp50 billion, giving small and medium enterprises in the regions a greater role in the sector’s value chain.