To comply with Bapepam’s Rule No. X.K.1, regarding the Disclosure of Information That Must Be Made to Public Immediately and the JSX’s Rule No. I-E regarding the Requirement To Disclose Information, we, PT Medco Energi Internasional Tbk (the “Company”/”MedcoEnergi”), would like to inform you that on April 13, 2008, MedcoEnergi through its wholly owned subsidiary, Medco Yemen Amed Ltd. and Medco Yemen Arat Ltd. (altogether referred as “Medco Yemen”), a company owned wholly by the Company through its wholly owned subsidiary, Medco Energi Global Pte. Ltd., has executed the following:

Medco Yemen, Kuwait Energy Company (‘Kuwait Energy”), Indian Oil Corporation Limited ("Indian Oil”), Oil India Limited (“Oil India”) and Yemen General Corporation for Oil and Gas (“YOGC”), a Yemeni state owned enterprise, (referred to jointly and collectively as the “Contractor”) have entered into A Production Sharing Agreement (“PSA”) with Ministry of Oil and Mineral Republic of Yemen (“MOM ROY”) to join and assist in exploration, development and production of potential petroleum resources in Block 82 (Wadi Amed) and Block 83 (Wadi Arat) both in Hadhramout Governorate in the Republic of Yemen.

Prior to the signing, in the Third international Bid Round for Yemen the MOM ROY announced that the Contractor declared as winning bidder for Block 82 (Wadi Amed) in Sabwah area and Block 83 (Wadi Arat) in Seiyun area in December 2006. Medco Yemen will act as the operator in those blocks. The Government of Yemen has participation in the PSA through YOGC.

The participating interest composition of the blocks is as follows:

The Negotiation and finalization of the PSA were completed in December 2007 and the initialed documents were submitted to the Supreme Economic Council Republic of Yemen for approval which in turn was acquired in February 2008.

The PSA was then submitted to Prime Minister Cabinet and was approved in March 2008. With this approval, the MOM ROY is authorized to sign the PSA with contractors including the Contractor

The signed PSA will not be effective until the Parliament approves the PSA as laws in Yemen. The signed PSA will be submitted to the Parliament for approval and the process is expected to take 3 months from the signing of the PSA.

Compliance with the Bapepam’s Rules

To proceed with the acquisitions, the Management of MedcoEnergi has considered the followings rules:

1.    Rule of Bapepam No. IX.E.2.

Based on the Company’s calculation by using the Audited Consolidated Financial Statements for the Year Ended December 31, 2007, the purchase of Block 82 (Wadi Amed) in Sabwah area and Block 83 (Wadi Arat) in Seiyun area through the signing of the PSAs with MOM is not material in value or less than 10% and 20% of the Company’s consolidated revenue and equity, respectively. Therefore, approval from the Extraordinary General Meeting of Shareholders for this acquisition as stipulated under the Rule of Bapepam No. IX. E.2  regarding  Material Transaction and Change of Core Business is not required to be obtained.

2.    Rule of Bapepam No. IX.E.1.

As MOM ROY is a government institution in which have no affiliated relationship with MedcoEnergi or its members of commissioners,  directors, major shareholders and their affiliates, therefore, such purchasing is not considered as a conflict of interest transaction and no approval from independent shareholders is  required, as stipulated under the Rule of Bapepam No. IX.E. regarding Conflict of Interest for Certain Transactions.

Financial Impact

This transaction will not materially affect the current year income or assets of MedcoEnergi. 

Thank you for your attention.