{
    "success": true,
    "data": {
        "id": 1414354,
        "msgid": "natuna-gas-project-management-1447893297",
        "date": "1999-09-02 00:00:00",
        "title": "Natuna gas project management",
        "author": null,
        "source": "JP",
        "tags": null,
        "topic": null,
        "summary": "Natuna gas project management Commission V of the House of Representatives (DPR) has recommended that the government cancel PT McDermott's contract to construct the Natuna gas pipeline, worth US$335 million, as reported in Bisnis Indonesia and Media Indonesia on Aug 27. This recommendation must be considered, yet at the same time it must be taken into account that the project must be implemented according to the schedule and technical specifications already stipulated and at the lowest cost.",
        "content": "<p>Natuna gas project management<\/p>\n<p>Commission V of the House of Representatives (DPR) has<br>\nrecommended that the government cancel PT McDermott's contract to<br>\nconstruct the Natuna gas pipeline, worth US$335 million, as<br>\nreported in Bisnis Indonesia and Media Indonesia on Aug 27.<\/p>\n<p>This recommendation must be considered, yet at the same time<br>\nit must be taken into account that the project must be<br>\nimplemented according to the schedule and technical<br>\nspecifications already stipulated and at the lowest cost. The<br>\nwrong choice must not be made because we are too sensitive to the<br>\nghosts of corruption, collusion and nepotism as this could cause<br>\nlosses of $388.6 million for Pertamina and the government,<br>\naccording to the report of Foreign Contractors Management Body<br>\n(BPPKA) head Gatot Karl Djoso Wiroyudo in Media Indonesia on Aug.<br>\n27.<\/p>\n<p>Another $14.7 million would be lost in payment for the work<br>\nalready done by McDermott as well as the cancellation fee. An<br>\nadditional amount of $38 million would be added because the most<br>\neconomic second bid totaled $373 million by PT Saspem Indonesia.<br>\nThis would cause the additional loss of $52.7 million so that the<br>\ntotal losses, if the McDermott contract is canceled, would total<br>\n$421.3 million (approximately Rp 3.160 billion or six times<br>\nbigger than the amount involved in the Bank Bali scandal).<\/p>\n<p>If these figures are correct and if, with reference to the<br>\nprovisions in the contract and the general rules internationally<br>\napplicable, it is rather unlikely that Pertamina would sustain<br>\nthese losses. If making an overall analysis it would seem that<br>\nPertamina would be better off staying with the initial decision<br>\nof appointing PT McDermott as the winner of the contract. If not,<br>\nthe financial losses may indirectly burden the Indonesian<br>\npeople.<\/p>\n<p>Bob Hasan's 18.5 percent share of PT McDermott should be<br>\nseparately discussed to make sure that the project does not have<br>\na vestige of corruption, collusion and nepotism. In this way the<br>\nimplementation of the project could go forward.<\/p>\n<p>The DPR and Pertamina must take into account the counter<br>\nargument levied by the area manager of PT McDermott Indonesia,<br>\nHoward J. Cleave, regarding the irregularities exposed by the<br>\nDPR. According to Media Indonesia and Bisnis Indonesia on Aug.<br>\n30, Cleave has suggested the involvement of an independent<br>\nauditor to assess the validity of the tender.<\/p>\n<p>For this time (and the last time) we should give a concession<br>\nto the possibility of corruption, collusion and nepotism in order<br>\nto save Indonesia's people Rp 3.160 billion. In addition, we<br>\nwould also be able to keep our promises to the foreign gas buyers<br>\n(through Singapore) so that Pertamina can continue to enjoy<br>\nforeign trust.<\/p>\n<p>H. WISDARMANTO GS<\/p>\n<p>Jakarta<\/p>",
        "url": "https:\/\/jawawa.id\/newsitem\/natuna-gas-project-management-1447893297",
        "image": ""
    },
    "sponsor": "Okusi Associates",
    "sponsor_url": "https:\/\/okusiassociates.com"
}