"BP in talks just now agreed to participate in the development of geothermal energy in Indonesia thus to increase our power capacity," he said at a press conference.
President Yudhoyono said the agreement was the result of his talks with BP CEO Bob Dudley at Gedung Agung.
He said so far geothermal energy in the country has not yet been exploited well despite the fact that the country has the world`s biggest reserves.
He said the energy source has not yet been developed well due to investment challenges.
He said although incentives had been given the sector has not developed well. He said the oil subsidy had also made the price of geothermal energy not competitive yet.
The President reiterated that geothermal energy is one of the future environmental friendly renewable energy sources.
President Yudhoyono on the occasion also expressed appreciation to BP that has agreed to transfer 230 cubic feet of gas per day from its Tangguh field in Papua to domestic industries. The gas from the field had so far been exported.
President Yudhoyono said the agreement would support the economic development especially domestic industrial development.
He said the government in the future must make efforts to re-negotiate its working contracts so that the gas produced by fields in the country could be sold to the domestic market.
"In view of our economic challenges the government had actually conducted re-negotiations to make the gas produced in Indonesia not to be totally sold abroad which is certainly not fair and correct," he said.
He said however the government would always respect the contracts that have been signed. "I honor the contracts but I also appeal to investors, business leaders in Indonesia to understand the situation in Indonesia. If the contracts are considered not right and not quite fair we, with a good will, wish to improve them and renew them," he said. (*)
Editor: Aditia Maruli Radja
Copyright © ANTARA 2012
