Local contractor demands PLN pay compensation

JAKARTA (JP): Local service company PT Enico National Development is persisting with its demand for compensation from cash-strapped state electricity company PT PLN for losses caused by the latter's breach of a disposal contract almost a decade ago.

Enico assistant president Agus Purnama said on Saturday that the Supreme Court issued a ruling in the middle of last year ordering the North Jakarta court to confiscate PLN's bank accounts amounting to Rp 2 billion (about $250,000) and provide the funds to Enico as compensation for its losses caused by PLN's violation of their contract.

The North Jakarta court did not execute the ruling due to opposition by PLN and Minister of Mines and Energy Kuntoro Mangkusubroto.

He said the Supreme Court later reviewed its decision after Kuntoro made his complaint.

Agus said Enico received a contract from PLN for coal disposal at the coal-fired power plant in Suralaya in 1989.

According to Agus, PLN refused to pay the service fee to Enico and annulled the contract in 1990 on the grounds that Enico performed poorly.

Enico, insisting that it performed its job well and in accordance with the contract, filed suit against PLN in 1993 at the North Jakarta District Court.

The company won the case. PLN, which lost its appeal in the higher court, filed another appeal with the Supreme Court, which later also ruled in favor of Enico for Rp 1 billion.

Enico asked the Supreme Court to review its decision because it considered the compensation was too low. At the time, the Supreme Court agreed to review the compensation award and ultimately ruled to increase it to Rp 2 billion.

Agus said Kuntoro later called on the Supreme Court to review the decision, saying PLN never awarded any contract to Enico.

The West Java Thermal Power Plant Project -- which is currently known as a division of PLN -- awarded the coal waste- disposal contract to Enico in 1989, Kuntoro stated in a letter to the Supreme Court dated March 23.

Agus said the Supreme Court subsequently ordered the North Jakarta court to delay confiscating PLN's funds.

Enico has sent dozens of letters to the Supreme Court protesting the delay in executing its decision, but there has been no response. (jsk)