Indonesia's Ministry of Energy & Mineral Resources (ESDM) has launched the third Indonesia Petroleum Bidding Round (IPBR) for 2026, offering eight oil and gas blocks through two distinct processes.

Blocks on Offer

The licensing round comprises eight blocks. Three are offered via a direct bid process: the onshore Tapah block (South Sumatra & Jambi); the onshore and offshore Nawasena block (East Java); and the onshore and offshore Mabelo block (Southeast Sulawesi). Five blocks are offered via a regular tender process: the offshore Arwana III block (Natuna Sea); the onshore Tuah Tanah block (North Sumatra & Riau); the onshore Rangkas block (Banten & West Java); and the onshore Akimeugah I and Akimeugah II blocks (South Papua and Papua Pegunungan). The Tapah, Tuah Tanah, and Akimeugah blocks were not part of the previously expected acreage, replacing several other anticipated blocks.

Resource Estimates and Potential

ESDM has provided resource estimates for several blocks. The Tapah block is estimated to hold 439.5 million barrels of oil and 23 billion cubic feet of gas. The Tuah Tanah block holds an estimated 52.51 million barrels of oil. The Akimeugah I and II blocks, previously offered in 2023, are described as frontier areas with huge potential, each holding an estimated resource of 15 billion barrels of oil equivalent.

Enhanced Contractual and Fiscal Terms

To increase the appeal of the tender, ESDM has refined the contractual and fiscal terms. The production sharing contract now offers greater flexibility, including a profit split of up to 50% for the contractor based on risk profile, 100% Indonesian Crude Price for the Domestic Market Obligation, and no cost recovery restrictions. Contractors can choose between a cost recovery scheme or a gross profit split scheme. Other enhanced terms include 10% shareable First Tranche Petroleum, tax facilities, and non-mandatory relinquishment.

Bidding Timeline and Process

The bidding process has specific deadlines. For direct bids, access to bid documents is available until 3 February 2026, with participation documents due by 5 February 2026. For the regular auction, the deadline to access bid documents is 17 April 2026, with participation documents due by 21 April 2026. The entire registration and data access process will be conducted online via the official ESDM website.

Context and Related Announcements

This third IPBR follows the second round launched just two months prior in October 2025. ESDM aims to offer up to 75 blocks by the end of 2027 to boost exploration and production, supporting a national target of 1 million barrels of oil per day by 2029. Separately, ESDM announced the award of the Gagah block to local company Proteknik Utama. This block, offered via direct bid in the second IPBR, is estimated to hold 173 million barrels of oil or 1.1 trillion cubic feet of gas. The award requires a $300,000 signature bonus and a $4.25 million firm commitment for the first three years of exploration, which includes studies, seismic acquisition, and an exploration well. Proteknik Utama is preparing for the contract signing and plans to finalize its exploration well plan by late 2026.