KBC used forged documents to back its claim: Police<\/p>\n
Abdul Khalik, Jakarta<\/p>\n
The police have accused U.S.-based Karaha Bodas Company (KBC)
\nof using fake documents in its lawsuit against state oil and gas
\nfirm PT Pertamina at the International Court of Arbitration.<\/p>\n
National Police anticorruption chief Brig. Gen. Indarto said
\non Wednesday that the KBC and certain Pertamina officials had
\nfabricated transaction and payroll documents, among others, to
\nallow them to mark up the cost of the Karaha Bodas geothermal
\npower project.<\/p>\n
\"We have discovered the fake documents, which we believe were
\nused at the arbitration court,\" Indarto told reporters.<\/p>\n
The police are investigating a corruption case involving the
\nKaraha Bodas power project and named three suspects on Tuesday,
\nincluding the former head of the geothermal division at
\nPertamina, Priyanto, his subordinate Syafei Sulaiman and Robert
\nD. McCutchen of the KBC for their roles in concocting fictitious
\ntransactions to inflate the cost of the project.<\/p>\n
The government hopes if it can prove that the KBC power plant
\nproject was mired in corruption, it can avoid paying damages to
\nthe U.S. firm.<\/p>\n
The KBC signed a contract with Pertamina to develop two
\ngeothermal power plants in Garut, West Java, but the project,
\nalong with dozens of other power projects, was suspended by the
\ngovernment in the wake of the late 1990s economic crisis.<\/p>\n
The firm filed a lawsuit in 2000 against Pertamina for breach
\nof contract at the Geneva-based arbitration court. The following
\nyear, the court ruled in favor of the KBC and ordered Pertamina
\nto pay US$261.1 million in damages.<\/p>\n
Pertamina has not yet paid the damages, as the government is
\nattempting to negotiate with the KBC to reduce the amount, which
\nhas now inflated to over $290 million due to accumulated
\ninterest.<\/p>\n
Pertamina previously filed two appeals to the court, but was
\nunsuccessful in both. A U.S. court froze Pertamina's accounts in
\nthat country at the request of the KBC, while the U.S. Supreme
\nCourt is expected to rule on the case in September.<\/p>\n
Although State Minister of State Enterprises Laksamana Sukardi
\nhas said in national media that the government would order
\nPertamina to honor the arbitration court's ruling and pay
\ndamages, National Police chief Da'i Bachtiar suggested to
\nwithhold payment until the completion of the corruption
\nproceedings.<\/p>\n
\"We have two choices here. If we can take the (corruption)
\ncase to court quickly and get a verdict, we can use it as a basis
\nto avoid paying damages. Or, if it looks like the court will take
\na long time to make a decision, we can pay now but reclaim it
\nlater,\" said Indarto.<\/p>\n
Legal expert Luhut M. Pangaribuan said the new evidence could
\nbe used to demand the annulment of the arbitration court's
\nruling.<\/p>\n
Under Indonesian law, a decision based on fake documentation
\nmust be annulled.<\/p>\n
\"Although it is a little too late, we must try to present the
\nnew evidence to the U.S. court to avoid paying damages after we
\nget a decision from our court. However, it will all depend on
\ntheir interpretation as to whether the new evidence is valid,\" he
\nsaid.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/kbc-used-forged-documents-to-back-its-claim-police-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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