The idea of establishing a petroleum research centre in Indonesia was first raised in 1962 soon after the promulgation of the oil law, Law No.44/1960. This Law is the first step by the government to implement. Article 33 sub 3 of the 1945 Constitution stated: “Lands and waters and all their resources are the property of the state and shall be utilized for the utmost benefit of the people” Petlroleum are then the property of the state and the oil Law No.44/1964 prohibits the oil companies to operate in Indonesia as concessionaires. They can only operate in Indonesia as contractors to the Government. Acting on behalfe of the Government is our National oil company,PERTAMINA