Kuntoro supports Pertamina's decision on pipeline project
Kuntoro supports Pertamina's decision on pipeline project
JAKARTA (JP): Minister of Mines and Energy Kuntoro
Mangkusubroto supported on Tuesday state oil and gas company
Pertamina's decision to name PT McDermott Indonesia to build a
natural gas underwater pipeline linking west of Natuna island to
Singapore.
Kuntoro said based on a report from Pertamina, the awarding of
the pipeline contract to PT McDermott Indonesia, the Indonesian
unit of the American construction company J Ray McDermott SA, had
been conducted in a process consistent with the prevailing
regulation.
"The report that was submitted (by Pertamina) to me indicates
the bidding of the project was conducted transparently," Kuntoro
said on the sidelines of a seminar on environmental protection
and community development in the mining and energy sector.
The seminar was held to commemorate environmental day.
Pertamina's president Martiono Hadianto endorsed the selection
of McDermott for the construction of a 650-kilometer underwater
pipeline on May 14 after finding no faults at the bidding held by
the West Natuna gas consortium and won by McDermott.
In the bidding, McDermott offered the lowest bid at US$225
million, undercutting its competitors, namely ETPM of France,
Saipem of Italy, and Nippon Steel of Japan.
The gas consortium consists of the United States's Conoco
Corp., Britain's Premier Oil and Canada's Gulf Resources.
Pertamina has signed a deal to channel gas from the
consortium's gas fields in the Southeast China sea to Sembawang
Gas in Singapore through the pipeline for 22 years starting from
2001.
The selection of McDermott for the project, however, angered
several legislators who charged the consortium with favoring
Western companies from the outset of the bidding process.
The legislators also criticized the affiliation of McDermott
with former president Soeharto's golfing partner Mohammad Bob
Hasan.
Pertamina earlier said Bob Hasan resigned from his post as a
commissioner in McDermott Indonesia and he had put his stake in
the company for sale.
Legislator Priyo Budi Santoso earlier said the House of
Representatives' Commission V for mines and energy, industry and
trade, environment, investment and manpower would summon Martiono
and Kuntoro to explain the deal.
"We demand the tender result be canceled or annulled until
Pertamina and the minister submit the report to the House," Priyo
said.
Kuntoro said Pertamina had no legal obligation to report to
the House about the project, but it was ethically obliged to do
so given the controversies caused by the project.
"With regards to the call for retendering the project, I call
on the House to express their opinion after meeting with
Pertamina," Kuntoro said. (jsk)