Prepare the dried chili peppers: Soak the dried chilli peppers in warm water for 30 minutes. Whilst they are soaking, prepare the remaining ingredients.
Prepare the spices for blending. Remove the shell and ends of the lemongrass and roughly chop. Peel the garlic and roughly chop. Remove the stems off the fresh chilli's (remove the seeds if you prefer a less spicy sambal). Remove the stem from the lime leaves. Remove the skin of the ginger.
Drain the dried chilli's but keep the water.
To a food processor add ¼ cup chilli water, dried chilli's, lemongrass, ginger, garlic, lime leaves, and onion. Blend smooth. Don't worry if it's not silky smooth, chunky pieces are okay.
Heat oil in a large pan or wok. Add the sambal mix, cooking and stirring for 10 minutes. Add approximately 1 cup of chilli water throughout cooking to achieve the desired consistency.
Turn off the heat and add the coconut sugar and tamarind paste and continue to mix in for 2 minutes. Allow the sauce to cool before storing in a container or jar.
You can keep the sambal in the fridge for at least a week or you can freeze sambal for up to 1 month.