Kuntoro calls for thorough inquiry into refinery graft

Kuntoro calls for thorough inquiry into refinery graft

JAKARTA (JP): Minister of Mines and Energy Kuntoro
Mangkusubroto called on the public prosecutors and government
auditors on Monday to thoroughly investigate alleged corruption
at the Balongan refinery in Indramayu, West Java.

Kuntoro said that the prosecutors from the Attorney General's
Office and auditors from the State Financial Comptroller (BPKP)
should examine all government officials and state oil and gas
company Pertamina's officials involved in the preparation,
approval and development process of the refinery in order to find
the people responsible for the corruption.

"I think all persons involved in the process should be
questioned," Kuntoro said on the sidelines of a ceremony to award
oil and gas production sharing contracts to four contractors.

Kuntoro did not identify the people involved in the
preparation, approval and development of the refinery project.

The Balongan case hit the headlines last year but was
forgotten for a long time until the anticorruption watchdog
Indonesian Corruption Watch (ICW) sent a letter to President BJ
Habibie last Thursday questioning him about the follow up to the
investigation of the case.

The refinery was built between 1990 and 1995 and has a
processing capacity of 125,000 barrels of oil per day.

ICW suspected the President of intervening to stop the
investigation in order to protect his close associates.

ICW said that it had information that the Attorney General's
Office had reported the identities of the people responsible for
the corruption to the President four months ago, but no legal
action had been taken against them.

Former attorney general Muhammad Ghalib, in a letter sent to
Habibie on May. 21 this year, said the investigation by his
office indicated former Pertamina president Faisal Abda'oe and
former Pertamina processing director Tabrani Ismail were
implicated in the corruption.

Faisal, a close associate of former president Soeharto, ended
his leadership of Pertamina last year after eight years of
service.

He currently serves as head of the government-sponsored task
force for the Natuna liquefied natural gas project, which in the
past was chaired by Habibie.

Ghalib also said former mines and energy ministers Soebroto
and Ginandjar Kartasmista, who is the outgoing coordinating
minister of economy, finance and industry, and Pertamina
president AR Ramly and several other officials, should also be
questioned over their knowledge, or possible involvement in the
case.

Ghalib said Pertamina awarded the contract for the
construction of the refinery to the British company Forster
Wheeler in 1990 despite the fact that the cost of the project had
been marked up by US$113 million.

Ghalib suspected Forster Wheeler of colluding with Soeharto's
son Sigit Hardjodjudanto to pressure Pertamina to accept the
marked-up price.

Kuntoro said there were signs that the Attorney General's
Office and BPKP would soon finalize their investigation into the
case.

He said both agencies would submit their reports to
Coordinating Minister of Development Supervision/Administrative
Reforms Hartarto Sastrosoenarto who was in full charge of
handling the case.

"I am awaiting the (audit and investigation) results signed by
the coordinating minister of development
supervision/administrative reforms," Kuntoro said.

Pertamina's president Martiono Hadianto refused to comment on
the case. (02/jsk)