Indonesia weighs not extending gas exports as Singapore contracts expire in 2028

Key Facts

Indonesian Energy Minister Bahlil Lahadalia raised the possibility of not extending gas exports to neighbouring countries in remarks carried by Indonesian state television, linking his position to the priority of meeting domestic demand. "I may also consider not extending gas exports to neighbouring countries," Lahadalia said, adding: "Domestic needs must be met first." The minister did not name any country in his remarks on non-renewal or a review of exports, according to the Straits Times, leaving his proposal focused on exports to neighbouring countries without identifying a particular buyer. Singapore is among the buyers of Indonesian gas, with pipeline gas exports to the city-state reaching 145.3 billion cubic feet in 2024, according to the U.S. Energy Information Administration. Those volumes fell 11.8% from 2023, an annual decline in Indonesian flows to the Singapore market that preceded the remarks on potentially not extending exports. The timeline for the existing contractual relationship was set out by the Singapore government in a parliamentary statement dated 23 September 2025, which said current gas import contracts with Indonesia expire at the end of 2028. The possibility of non-renewal raised by Lahadalia thus coincides with the expiry of contracts involving a regional buyer that relies on imported gas to run its electricity system.

Singapore uses imported natural gas to generate about 95% of its electricity, according to the Ministry of Energy, Trade and Industry, making access to imported fuel a key part of its electricity supply. Liquefied natural gas is a major source of those supplies alongside pipeline gas, accounting for nearly 60% of Singapore's total gas supply at the time of the parliamentary statement in September 2025. That share refers to the country's gas supply mix, while the share used in electricity generation reflects the role gas plays after reaching the domestic market. On procurement arrangements, GasCo was established in April 2025 to centralise natural gas purchases and supply to the power sector, according to the Singapore ministry. Alongside gas supply arrangements, the Energy Market Authority granted the Singa Renewables project a conditional licence to import low-carbon electricity from Indonesia into Singapore. The conditional licence covers 1 gigawatt of import capacity under a project aimed at transmitting electricity between the countries, in addition to their existing gas trade relationship. The project targets commercial operations from 2029, according to the authority, a date after the expiry of the current Indonesian gas contracts cited by the Singapore government.

In LNG import infrastructure, the maximum gas send-out capacity of Singapore's existing terminal is about 11 million tonnes a year, according to the Ministry of Energy, Trade and Industry. The terminal forms the country's current receiving base, which Singapore plans to expand with a second terminal as part of the supply security preparations outlined by the Energy Market Authority. Development of the second terminal includes a floating unit with planned regasification capacity of 5 million tonnes a year, according to the ministry, to prepare imported LNG for use after receipt. The Energy Market Authority says the new terminal will increase Singapore's LNG import capacity by 50% when ready, expanding the country's capacity to receive the fuel. Lawrence Wong previously outlined the purpose the additional terminal could serve in an official speech, saying: "With a second terminal, Singapore will be able to meet its power generation needs entirely with LNG, if necessary." The expansion places LNG at the centre of arrangements to secure fuel for electricity generation, while retaining the option of relying on it entirely if necessary, as Wong indicated. The Energy Market Authority expects the second terminal to be ready by 2030, making completion of this increase in import capacity the next milestone in the announced gas infrastructure expansion timetable.