With a view to implementing the provisions of the Minister of Finance Regulation, No. 78/PMK.010/2005, which deals with work contracts that were agreed prior to the enactment of Law No. 27 of 2003 on Geothermal Power, the Director General of Customs has issued Regulation No. P-01/BC/2006. The Geothermal Power Law provides import exemptions and concessions for the geothermal power industry to enable greater levels of development within the industry to ensure that geothermal power becomes a viable energy alternative.

This Government Regulation (the ?Regulation?), No. 1 of 2006, is issued pursuant to the provisions of Article 48(2) and Article 49 of Law Mo. 22 of 2001 on Oil and Gas in order to ensure the operational budget of the Regulatory Authority (Badan Pengatur).

The first 2 Presidential Instructions for 2006 have been issued and both deal with energy issues. The first deals with alternative fuel sources, specifically bio-fuels. The second deals with liquefied coal as an alternative energy source.

The Government has released the National Energy Policy on 25 January 2006 and the provisions of the policy came into immediate force. The National Energy Policy (NEP) is contained in Presidential Regulation No. 5 of 2006 (the ?Regulation?) and is broadly defined to be the mechanism that will ensure energy security and supply in the support of development. In essence the NEP is the energy management tool of choice of the Government.

The Minister of Energy and Mineral Resources has issued Regulation No. 0045 of 2005 on Electricity Installations (the ?Regulation?) to facilitate the implementation of Articles 21, 22, and 23 of Government Regulation No. 10 of 1989 as amended by Government Regulation No. 3 of 2005 on the Supply and Exploitation of Electricity (?GR 3/2005?). The point of the Regulation is to ensure that there is sufficient infrastructure in place and that the infrastructure that already exists is fit for purpose. This should then provide a guarantee in terms of uninterrupted supply of electricity to the community.

The Minister of Energy and Mineral resources issued Regulation No. 0048 of 2005 on 30 December 2005 (the ?Regulation?). This Regulation addresses matters related to standards, quality specifications, and supervision of all fuel products and derivatives traded on the domestic market. The Regulation has been issued to facilitate the implementation of Articles 62 and 65 of Government Regulation No. 36 of 2004 on Downstream Oil and gas Business Activities (GR 36/2004).

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