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November 10, 2026
by Tiyana Sigi Pertiwi
Overview
The Minister of Energy and Mineral Resources (MEMR) has issued Regulation No. 7 of 2026 on Business Activity Standards for the Implementation of Risk-Based Business Licensing in the Energy and Mineral Resources Sector (“MEMR Regulation 7/2026”), to implement Article 5(7) of Government Regulation No. 28 of 2025 on the Implementation of Risk-Based Business Licensing (“GR 28/2025”), which forms part of the adjustment of the business licensing framework in the energy and mineral resources sector. Appendix I of this MEMR Regulation 7/2026 also accommodates developments in business activities through more specific provisions governing several activities, including Carbon Capture and Storage (CCS), the blending of refinery oil products with biofuels, biogas business activities, and waste-to-energy processing. These provisions reflect efforts to align business activity standards with developments in the energy sector and provide greater clarity regarding the licensing framework for business actors. The MEMR Regulation 7/2026 took effect on the date of its promulgation on 12 June 2026 and it replaces the MEMR Regulation No. 5 of 2021.
Matrix Summary
| Provision | Key Summary |
|---|---|
| Articles 2–5 | Business actors are required to obtain PB and, where necessary, PB UMKU through the OSS System. PB is issued upon fulfillment of the basic requirements, unless regulated otherwise. Article 3 simplifies, for certain activities, the spatial utilisation conformity (KKPR/Kesesuaian Kegiatan Pemanfaatan Ruang) requirement. PB covers the oil and gas, electricity, mineral and coal, and new and renewable energy and energy conservation subsectors. PB UMKU also covers geology. |
| Articles 6–12 | Supervision of PB and PB UMKU is carried out in accordance with the applicable laws and regulations. Violations are subject to administrative sanctions that vary by subsector, including written reprimands or warnings, suspension or temporary cessation of business activities, administrative fines, and/or revocation of the relevant licenses. |
| Articles 13–17 | The transportation of oil, gas, fuels and processed products through modes other than pipelines is subject to the norms, standards, procedures and criteria (NSPK) governing the transportation sector. This Regulation also addresses the processing of pending applications, the continued validity of previously issued licenses, and the requirement to align activities involving the blending of oil and gas products with biofuels within 12 months of its promulgation. |
| Articles 18–21 | The new PB and PB UMKU provisions do not apply to holders of existing valid licenses, unless the new provisions are more favorable. License nomenclature shall be interpreted in accordance with this Regulation. Other relevant Ministerial Regulations remain in effect insofar as they do not conflict with this Regulation. |
| Appendix I and II | Appendix I sets out the business activity standards for PB, while Appendix II governs the standards for PB UMKU in the energy and mineral resources sector. Both appendices cover the scope of activities, requirements, verification procedures, validity periods where relevant, and obligations applicable to each license type. |
Key Highlights
Business Licensing and Basic Requirements
Business actors in the energy and mineral resources sector are required to obtain Business Licenses (PB/Perizinan Berusaha) and, where necessary, Business Licenses to Support Business Activities (PB UMKU/Perizinan Berusaha Untuk Menunjang Kegiatan Usaha), which are processed electronically through the Online Single Submission (OSS) System. In principle, PB is issued after the basic requirements have been fulfilled, subject to certain exceptions concerning spatial utilization of conformity approvals for specific activities and infrastructure. PB covers the oil and gas, electricity, mineral and coal, as well as new and renewable energy and energy conservation subsectors, while PB UMKU also covers the geology subsector.
Article 3 simplifies the basic requirement in the form of approval of spatial utilisation conformity (KKPR) in several cases, as follows:
Activities in forest areas or marine waters follow the applicable regulations. PB covers the oil and gas, electricity, mineral and coal, and new and renewable energy and energy conservation subsectors. PB UMKU also covers geology.
The business activity standards for PB and PB UMKU are respectively stipulated in Appendices I and II of the MEMR Regulation 7/2026.
Supervision and Administrative Sanctions
Supervision of PB and PB UMKU is carried out in accordance with the applicable laws and regulations. Violations may be subject to administrative sanctions that vary by subsector, including written reprimands or warnings, suspension or temporary cessation of business activities, administrative fines, and/or revocation of PB or PB UMKU. Specifically, in the electricity subsector, violations resulting in casualties and/or damage affecting safety, health, the environment, resource utilization, or other aspects may result in the temporary suspension or revocation of the relevant licenses. In the mineral and coal subsector, violations of obligations to pay state and/or regional revenues may also be subject to administrative fines.
Transportation, Business Classification Adjustments, and Transitional Provisions
PB UMKU for the commercial transportation of crude oil, natural gas, fuel oil, fuel gas, and/or processed products using modes of transportation other than pipelines is subject to the norms, standards, procedures, and criteria of the transportation sector. Any amendments to the Indonesian Standard Industrial Classification (KBLI/Klasifikasi Baku Lapangan Usaha Indonesia) in the classifications under this MEMR Regulation 7/2026 are applied automatically. Applications for PB and/or PB UMKU that remain under processing before the OSS System is adjusted shall continue to be processed in accordance with the provisions set out in Article 15, while licenses that have been issued and remain valid shall continue to be effective until their respective expiration dates. Specifically, for the blending of processed oil and gas products with biofuels, business entities that already hold the relevant licenses may continue conducting such activities but must comply with this Ministerial Regulation no later than 12 months from its promulgation, i.e. by 12 June 2027.
Validity of Existing Provisions and Revocation of Regulations
The PB and PB UMKU requirements under this Ministerial Regulation do not apply to business actors that already hold licenses issued and remaining valid before the Regulation came into force, unless the new provisions are more favorable to the business actors. Licenses bearing different nomenclature shall be interpreted in accordance with the nomenclature stipulated under this Ministerial Regulation. Other Ministerial Regulations governing business activity standards in the energy and mineral resources sector shall remain in effect insofar as they do not conflict with this Regulation. Meanwhile, Minister of Energy and Mineral Resources Regulation No. 5 of 2021 is revoked and declared no longer valid. This Ministerial Regulation entered into force on the date of its promulgation, which was 12 June 2026.
Business Activity Standards under Appendices I and II
Article 5 stipulates that Appendix I sets out the business activity standards for PB, while Appendix II sets out the business activity standards for PB UMKU. Both appendices constitute an integral part of this Ministerial Regulation. Each standard identifies the licence and its KBLI codes, then generally sets out its scope, terms and definitions, business classification, requirements, verification and the holder’s obligations.
Appendix I covers licences across the four PB subsectors. In oil and gas, these include cooperation contracts, which extend to CCS and CCUS within working areas, and carbon injection target zone exploration permits, carbon storage operation permits and carbon pipeline transportation permits. They also include processing, trading and storage, and approval for blending refinery products with biofuels. In new and renewable energy and energy conservation, Appendix I includes geothermal, biofuel and biogas fuel business licences, waste-to-electricity (PSEL/ Pengolah Sampah Berbasis Teknologi Ramah Lingkungan Menjadi Energi Listrik) and waste-to-bioenergy or renewable fuel licences, and energy conservation services.
Appendix II covers supporting licences such as operational worthiness approvals for oil and gas installations, explosives warehouse approvals, captive electricity supply licences, registration of public EV charging and battery swap stations, approval of cross-border electricity purchase prices, mining licences for sales, and groundwater exploitation permits.
Tiyana Sigi Pertiwi, S.H., LL.M.
Knowledge Lawyer
