Balongan, Cilacap 'prone to oil smuggling'

Balongan, Cilacap 'prone to oil smuggling'

Leony Aurora and Eva C. Komandjaja, The Jakarta Post, Jakarta

As the investigation into the smuggling of crude and refined oil
products continues, state oil and gas firm PT Pertamina says
refineries in Balongan, West Java, and Cilacap, Central Java, are
also vulnerable to smuggling.

The two oil refineries have similar storage facilities to
those in Lawe Lawe, East Kalimantan, where a major smuggling ring
was uncovered last week, Pertamina president director Widya
Purnama said on Monday.

"The model (of oil input) is similar," he said. He declined to
name other areas where smuggling might have taken place.

In Lawe Lawe, the storage facilities are connected to tankers
by pipelines, which run seven kilometers onshore and 10
kilometers underwater.

Tankers have to use floating hoses to connect with a single
buoy mooring, which channel oil through subsea hoses to the
pipelines.

Pertamina's director of processing, Suroso Atmomartoyo, said
that after tankers send oil to storage, the pipelines are flushed
to clean out any remaining crude. "(The smugglers) can steal
through this system," he said.

The suspects in the Lawe Lawe smuggling admitted to have
conducted the illegal activity five times, stealing between
12,000 barrels and 13,000 barrels at a time, he said.

Widya said Pertamina had fired 40 crew members of four tug
boats, whose job was to guide tankers and connect them to the
buoy. "It is impossible that they were not involved in the
scheme."

Pertamina has fired 12 other low-ranking employees in
connection with the smuggling in Lawe Lawe.

Widya said Pertamina, the National Police, the Navy and the
Ministry of Finance's Directorate General of Customs and Excise
would sign a joint agreement to form a special task force to deal
with smuggling.

Separately, the National Police will work with Pertamina to
oversee imported oil distribution in the future.

"Starting from now, we will inform the police whenever we want
to import crude oil. We will also give detailed information such
as the name of the ships, the crews and the schedule so that they
(police) can keep a close eye on them," said Widya following a
meeting at National Police Headquarters.

The National Police's chief of detectives, Comr. Gen. Makbul
Padmanegara, who also attended the meeting, said the police would
not only help supervise oil delivery at sea but also land
distribution, though this initially will be limited to Tangerang
municipality and regency.

"We are planning a pilot project in Tangerang. The aim
of the project is to supervise distribution from there to small
agents," Makbul said.

Widya promised there would be no cover-ups surrounding the
smuggling.

"I think we will dismiss a lot of Pertamina officials soon and
we already have suspended Pertamina's head of the Batam
terminal," he said.

Makbul confirmed the head of the Batam terminal, Nono Asmanu,
had been declared a suspect in a smuggling case recently
uncovered in the area.

"Based on our preliminary investigation, we found a lot of
evidence indicating that he might be responsible for the
smuggling," he said.

The latest incident in Batam occurred last month when the Jaya
Success tanker transferred some 120 tons of diesel fuel to the
Aiwa Maru tanker, flying a Honduras flag, in the waters off
Batam.