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This article focuses on energy ties to assess the current state of bilateral relations between Japan and Indonesia in the wake of the August 2007 signing of the Japan-Indonesia Economic Partnership Agreement (JIEPA). With ratification by Japan's upper and lower houses expected by July 2008, the JIEPA leaves unresolved arguably the most important issue between the signatories, namely future natural gas exports to Japan. Indonesia seems determined to more than halve its exports to Japan, its best customer, whilst at the same time charging it more for the same supplies that China will also receive. This paper explains the reasons for the new Indonesian policy before briefly assessing a second strand of recent bilateral energy security developments, that of Japanese assistance to secure the Straits of Malacca. [ABSTRACT FROM AUTHOR]