McDermott tender audited<\/p>\n
JAKARTA (JP): The tender of a contract for the construction of
\na natural gas pipeline between West Natuna and Singapore, which
\nwas awarded to PT McDermott Indonesia, is currently under a
\nspecial audit to investigate possible irregularities in the
\nassessment of bids.<\/p>\n
President of state-owned Pertamina, Martiono Hadianto, said on
\nWednesday that the special audit was being made by the
\nDevelopment Finance Comptroller (BPKP) at the instruction of
\nCoordinating Minister for Development Supervision\/State
\nAdministrative Reforms Hartarto Sastrosoenarto.<\/p>\n
There was confusion over the status of the McDermott contract
\nfollowing a letter regarding a review of the tender process from
\nPresident B.J. Habibie's aide Sintong Pandjaitan, the secretary
\nfor development operation control (Sesdalopbang).<\/p>\n
House of Representative members have interpreted the content
\nof the letter as support toward a retendering of the project and
\nthe cancellation of McDermott as its selection.<\/p>\n
\"The letter from Sesdalopbang states that the contract should
\nbe continued if the procedures for tender are proven correct,\"
\nMartiono said.<\/p>\n
He said the results of the audit, which were expected to be
\ncompleted later this year, would determine the final status of
\nthe McDermott contract.<\/p>\n
\"We will just wait and see until the audit process is
\ncompleted,\" he said.<\/p>\n
Martiono said a consortium, consisting of Premier Oil of
\nBritain, Gulf Resources of Canada and Conoco Inc. of the United
\nStates, also asked PriceWaterhouseCoopers to make an independent
\naudit of the tender process.<\/p>\n
\"These two auditing processes are separate from each other,\"
\nhe said.<\/p>\n
However, preparations for the 560-kilometer submarine pipeline
\nproject are continuing due to a tight schedule, he said.<\/p>\n
\"We have to take the schedule into consideration. If the
\nproject is awarded to another firm, the consequences have to be
\nanticipated,\" he said.<\/p>\n
He hoped the tender reassessment would not affect the
\ncompletion of the pipeline project so that Pertamina would be
\nable to make gas delivery to Singapore by 2001 under a 22-year
\ncontract with Sembawang Gas.<\/p>\n
McDermott, a subsidiary of American firm J Ray McDermott SA,
\nwas alleged to have colluded with Pertamina officials by using
\ninside information to beat out other bidders in March.<\/p>\n
The company won the tender with the lowest bid of US$335
\nmillion against other bidders, including Italian firm Saipem,
\nFrench firm ETPM and Japanese firm Nippon Steel.<\/p>\n
The House of Representatives Commission V for mining has
\ndemanded that the government transfer the pipeline contract from
\nMcDermott to other bidders which offered the next lowest bid.<\/p>\n
McDermott has insisted, however, that it won the contract
\nthrough a competitive bidding process.<\/p>\n
The company's area manager, Howard J. Cleave, said recently
\nhis company won the contract through a lengthy, open and
\ntransparent bid process.<\/p>\n
Cleave said that McDermott's experience over the last 27 years
\nin Indonesia enabled it to cut project costs and offer the lowest
\nbid.(02)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/mcdermott-tender-audited-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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