Your Excellency, The Minister of Energy and Mineral Resources, Distinguished Guests, Ladies and Gentlemen,

We have now come to the close of INDOGAS 2007. I would like to express my sincere appreciation to you – the Delegates, the Speakers, the Sponsors, the Exhibitors, the Steering and the Organizing Committees for making this conference successful.

We are gathered here with a common goal to explore the strategies in advancing the role of gas in Indonesia 's long term energy strategy and the steps that must be taken for the optimal development of Indonesia 's vast gas resources to meet both domestic and international demand for clean energy.

Throughout Indonesia 's history, oil and gas have been the largest source of energy for domestic use as well as a critical source of foreign exchange and government income. As our population and economy grows, the demand for gas will only rise. A strong gas industry is therefore vital to the growth of the Indonesian economy.

Domestic gas demand is projected to increase from 4.2 BCFD in 2007 to 6.0 BCFD by 2020, or growing at 3.5% per year. This demand is driven by a number of factors including high power generation demand, sustained fertilizer demand, increasing industrial demand, elimination of oil subsidies.

Similarly world gas demand is also projected to increase by 2.5% per annum and in the face of depleting existing indigenous supplies globally, especially in North America and Europe, and the addition of new markets including China and India , there will be a w id ening gap in world gas demand and supply.

The strong demand for gas internationally and domestically bodes well for the future of our gas industry and our business and technology partners. With proven and potential gas resources exceeding 180 TCF, which is projected to amount to 61 years supply, gas can become a viable and commercially attractive primary energy resource to meet both Indonesian and international gas demand.

Additionally Indonesia is also blessed with a potential resource of up to 453TCF of Coalbed Methane, located in South Sumatra, in Kal iman tan in the Barito, Kutei and South Tarakan basins, Kerinci formation in Central Sumatra . Given the proximity of these reserves to existing infrastructure and markets, CBM clearly represents a potential alternative gas supply for domestic needs.

With 68 billion tons of coal resources and reserves, which is sufficient to supply 150 years of demand, coal gasification represents another source of gas which can help to secure a stable supply for gas for domestic use as fuel of chemical feedstock in the near future.

Considering the opportunities that are presented by the growth in global and domestic demand, Indonesia needs to develop strategies to accelerate the monetization of our resources. Exploration activities needs to be intensified, gas discoveries must be quickly commercialized, supporting infrastructures must be developed and domestic utilization must be stimulated.

However, there are hurdles to be crossed.

Firstly,
The need for clarity of regulations under the National Energy Policy
• Consistent interpretation of Energy Policy and development of integrated implementation strategy and plans across all related institutions must be addressed promptly.
• Overlapping laws and regulations pertaining to forestry, local autonomy and land acquisition must be resolved.
• Improved fiscal and tax incentives must be offered to attract more investments

Secondly,
The need for a clear policy on gas utilization for export or domestic use
• Exploiting natural gas for domestic industry and exporting gas do not conflict but are synergistic.
• Gas Balance cannot be treated as a whole but should be considered by regional needs, supplies and economics.
• Natural gas resources in remote areas may not be suitable for domestic use so a flexible policy may be favorable

Other issues which must be addressed include the need for government's initiation of an infrastructure development master plan and incentives to remove infrastructural constraints.

As we have heard from the President, the Government's commitment to ensuring that favorable policies and comprehensive implementation plans are quickly put in place to resolve these issues is resolute.

Your Ecellency, we sincerely hope that these recommendations put forward by this conference to the government can be considered for the basis of a comprehensive solution to the challenges facing the gas industry.

In closing, I would like to thank His Excellency, the Minister of Energy and Mineral Resources for his patronage and to thank all the participants for your enthusiastic participation. I believe you recognize and appreciate the value and contribution that this forum brings to the development of the Indonesian oil and gas industry.

I hope that you will continue to support the INDOGAS Conference and Exhibition and look forward to meeting you here again at INDOGAS 2009.

Thank you