Govt Asked To Interfere In Chevron's Boiremediation Case

News Focus - GOVT ASKED TO INTERFERE IN CHEVRON'S BIOREMEDIATION CASE By Andi Abdussalam Jakarta, May 29 (Antara) - A number of parties have expressed concern over PT Chevron Pacific Indonesia`s controversial bioremediation case, asking government`s interference so that it would not discourage oil and gas investment in the country. According to the ReforMiner Institute, President Susilo Bambang Yudhoyono needs to interfere in Chevron`s controversial bioremediation case to help straighten it out. "This case has serious impact on oil and gas investment in the country in the future," Komaidi Notonegoro, the deputy director of ReforMiner, said after attending a discussion on Monday. The alleged corruption case in the bioremediation project in the working area of PT Chevron Pacific Indonesia (CPI) in Riau province has led the Attorney General`s Office to name seven suspects. The same opinion was also voiced by Hilmi Rahman Ibrahim, the director of Indonesia for Public Trust. He said the government must handle CPI�s bioremediation case seriously to provide legal certainty for foreign oil and gas investors. The AGO has named seven suspects in the alleged CPI bioremediation corruption case which it said had caused a loss of US$23 million to the state. But some parties questioned the AGO proper reasons to name the suspects. Of the seven suspects, Ricksy Prematury, the director of PT Green Planet Indonesia (PT GPI) and Herlan, the director of PT Sumigita Jaya (PT SJ), have respectively been sentenced to five and six years in jail. PT GPI and PT SJ were the companies appointed by Chevron to carry out the bioremediation project. The five other suspects are Chevron`s executives and officials. They are Bachtiar Abdul Fattah, Alexiat Tritawidjaja, Kukuh, Widodo and Endah Rubiyanti. Bachtiar Abdul Fattah is the vice president of the Supply Chain Management (SCM) of PT Chevron Pacific Indonesia (CPI) while Alexiat Tirtawidjaja is the general manager of CPI`S Light North (SLN) operation. The case circles around PT Chevron Pacific Indonesia (CPI)`s environmental remediation project, particularly the bioremediation program from 2003 to 2011 at its oil and gas field in Riau, which was required in the contract. Bioremediation is a method in which metabolic microorganisms are used to remove pollutants for environmental purposes. Investigation into the case started after the Attorney General`s Office received reports in 2011 that the environmental project was fictitious. In March last year, the AGO accused PT CPI of appointing incompetent companies, PT Green Planet Indonesia (PT GPI) and PT Sumigita Jaya (PT SJ), to carry out the program after an initial investigation. Both companies, according to the AGO, were not certified for waste treatment work. Therefore, the AGO considered the project to be fictitious and has claimed that it caused state losses amounting to Rp200 billion (US$23.4 million), the Jakarta post has reported. The state loss was incurred as Chevron reportedly received a cost recovery budget from the now-defunct upstream oil and gas regulator BP Migas. Earlier during the trial, prosecutors said the cost recovery budget used to pay what they called a `fictitious` bioremediation project reached US$23.36 million. In December 2012, the South Jakarta District Court ruled that the AGO had not obtained enough preliminary evidence against four Chevron officials accused in the case and ordered the AGO to drop the case and clear the suspects of all charges. But AGO said in January that the agency would not comply with the district court ruling, arguing that the copy of the verdict had not been sent to the AGO. According to Komaidi of the ReforMiner Institute, the AGO has forcibly made Chevron`s bioremediation issue a legal case. It will have impact on national gas and oil investment in the future because of legal uncertainties with that regard. "If am a contractor, I will relocate my investment from the oil and gas sector because if not I will face a great risk, a big loss or a bad image in this sector," he said. He said that the contractors would have the same mind to avoid unfair implementation of the rules. Komaidi said that there could be two choices oil contractors would likely take in the face of the problem, namely diverting their investment from mining to the other sectors or they relocate their mining investment to other countries. He said that such a phenomenon had been felt even before the bioremediation case of Chevron was raised, where the volume of funds invested in the exploration of oil continued to decline. Thus, Chevron`s bioremediation case, according to the Upstream Oil and Gas Communications Forum (FKK Hulu Migas), has attracted the attention of oil and gas business players in the world. "It attracts the world attention because it involves criminal case," FKK Hulu Migas Chairman Joang Laksanto said through an electronic mail message to Antara in Riau province. Industry in general also gave serious attention to the corruption case in the bioremediation project. This was because it concerned legal certainties on business contracts and law enforcement. He said that enforcement of the law with regard to the case must be professional and fair. "We are concerned with CPI`s bioremediation project. It carries out its environment management program based a ministerial decree but they are facing jail on corruption charges," he said. He said that upstream oil activities were done by contractors based on a production sharing contract (PSC) which had been agreed by the Indonesian government. PSC is a business contract between the government of Indonesia and the private sector which is in the realm of the civil law. With regard to the case, the AGO has questioned tens of employees of the Upstream Oil and Gas Regulatory Task Force (SKK-Migas). "Many of them have even given testimonies in the court," SKK-Migas`s Public Relations Division Head Elen Biantoro when contacted from Pekanbaru through the phone said. SKK-Migas Head Rudi Rubiandiri previously said that he was concerned over the alleged corruption case of the bioremediation project in Minas, Riau province. The case had raised questionable matters which could become blunders for the attorney general`s office. According to Helmi Rahman Ibrahim, the AGO action endangers the future in oil and gas investment in the country because it mixes civil matters with criminal ones, ignoring cooperation agreements, in this case agreement between PT CPI and SKK-Migas (formerly known as BP Migas). He hoped that the government, President Susilo Bambang Yudhoyono in particular, would interfere in it as soon as possible so that this case would not develop too far. "There is no use to invite investors if investors who have made their investment in the country are criminalized," said Hilmi.