“Besides, to encourage domestic gas consumers to buy gas by economic prize,” says Evita H. Legowo in the Seminar INGTA, last week.

Other policy is the allocation of new-foundly gas reserves utilization is prioritized to fulfill local needs. If there is any surplus, the government has right to set the utilization of gas for export, but required investors commitment to contribute in developing infrastructure of domestic oil and gas development. Concerning the policy of gas allocation for domestic (DMO) is explicitly not only for contractors share, but also for government share gas.

Evita explained that to utilize gas for domestic needs, the government sets and or determines gas price refers to economy of field development and infrastructure. The gas price could be in form of escalation, related to oil price, products, and also the combination of both.

Evita said that the model of gas price consider the state revenue by also considering the optimum economic growth. The set of gas price considers the balance between producers interest and gas consumers.

Some current gas prices:

• Flat along the contract period (applicable for old contracts) in early period of gas purchase (about 1070s);

• Escalation (between 2-3% per year) around 1990s;

• Based on products (such as urea and ammoniac);

• Based on oil sales price in Japan (Japan Crude Cocktail/JCC).