Stealing the nation's assets<\/p>\n
It is common knowledge that oil, gasoline and diesel have long
\nbeen smuggled out of Indonesia, notably to Singapore -- mostly
\ndue to lax security and very lucrative profit potential.<\/p>\n
Indonesia's vast coastlines provide great opportunity for
\nsmugglers as the distance between the point of loading and
\nforeign points of unloading is often very short. Poorly paid
\nofficials, police and military (naval) personnel in league with
\nthe state oil company Pertamina, the sole supplier of such fuels,
\nare highly prone to corruption. Most importantly, the subsidized
\nprices of domestic gasoline, kerosene and diesel are around 60
\npercent below the prices that Singaporeans and Malaysians pay.<\/p>\n
The customs service, the police or patrolling Navy units
\nreveal from time to time the interception of boats attempting to
\nsmuggle these fuels out, but these are merely ploys to mislead
\nthe public into thinking that the authorities are doing their
\nbest to prevent the smuggling.<\/p>\n
However, the recent unraveling of the massive plunder of crude
\noil from Pertamina's floating storage facility off East
\nKalimantan, which was then sold to some profiteers in Singapore,
\nwas still a great shock, especially because it took place at a
\ntime when steeply rising oil prices are threatening to lead this
\ncountry into another economic crisis.<\/p>\n
The smuggling also was much, much bolder because the
\nprofiteers did not buy the oil to take it out of the country, as
\nmost others have thus far done, but they simply were pumping
\ncrude oil directly from Pertamina's facility through its
\nsubmarine pipeline to tankers they chartered, then shipped the
\noil to buyers in Singapore. The ordinary smugglers at least put
\nsome capital up front to procure subsidized fuels and then pocket
\nonly the profit margin between domestic and international prices.
\nBut the thieves in E. Kalimantan simply stole this nation's crude
\noil, sold it overseas and pocketed all the profit.<\/p>\n
Even more mind-boggling was the findings by the police
\ninvestigators that the massive theft had been going on since last
\nOctober, causing perhaps hundreds of million dollars in losses to
\nthe state. How could such a large-scale heist have occurred over
\nthe past 11 months without being detected by Pertamina's internal
\ncontrol system?<\/p>\n
National Police Chief Sutanto told reporters after a Cabinet
\nmeeting last Thursday that so far 58 people had been arrested --
\nincluding 18 Pertamina workers and five foreigners -- and 17
\nships laden with 6,000 metric tons of diesel and kerosene had
\nalso been seized.<\/p>\n
Still more shocking was the statement by Pertamina chief
\nexecutive officer Widya Purnama on Friday after meeting with
\nPresident Susilo Bambang Yudhoyono that only the \"little fish\"
\nhad so far been implicated in the theft and smuggling ring in
\nEast Kalimantan. He also asserted that they had yet to
\ninvestigate to see if there were any links with some of the
\nexecutives at the state company.<\/p>\n
How could a bunch of blue-collar workers such as a cook, a
\ndriver and other low-ranking employees have masterminded such a
\nmassive plunder for 11 months without being caught by the
\ncompany's internal-control system? As one of the largest
\ncompanies in the country -- though perceived to be one of the
\nmost corrupt -- Pertamina must have established a modicum of
\ninternal controls or some kind of a risk-management system to
\ndetect something like this.<\/p>\n
As a well-experienced professional manager, Widya, who managed
\nPT Indosat before being appointed to Pertamina, should have fully
\nrealized that inland and floating storages -- such as the one in
\nEast Kalimantan that can hold 135,000 tons -- are among the high-
\nrisk areas within the operations of an oil company to which the
\nrisk-management system should pay special attention.<\/p>\n
The other fuel smuggling syndicates in Riau islands and
\nCentral and East Java that the police discovered recently could
\nnot have operated without the collaboration of Pertamina
\nofficials. Pertamina still has a monopoly in the distribution of
\nfuel throughout the country, and it must know if a significant
\nvolume originally allocated for certain areas was diverted
\noverseas.<\/p>\n
Widya does not seem the type who would dirty his hands in such
\nblatant theft, but it does appear there was serious incompetence
\nin his management of the internal controls, which obviously were
\na farce, and for that he ought to resign or be fired.<\/p>\n
President Susilo is absolutely correct in setting the
\neradication of fuel smuggling on the top of his concerted efforts
\nto deal with the fuel crisis, because rampant smuggling not only
\nwill sabotage his programs, but also insults the public's sense
\nof justice. There would be enormous public resistance to raising
\nfuel prices if the drive against oil smugglers was not seen as
\ncredible.<\/p>\n
The rampant smuggling once again shows how imperative and
\nurgent it is now to bring domestic fuel prices closer to
\ninternational levels. As long as domestic fuel prices remain at
\njust 40 percent of international prices, as they are now, the
\npotential profit margin is too much temptation for profiteers --
\nin collusion with corrupt officials, military and police -- to
\nresist.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/stealing-the-nations-assets-1447893297",
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"sponsor": "Okusi Associates",
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