Locals retract threat to blockade Riau oil block

PEKANBARU, Riau (JP): The people of Riau agreed on Wednesday to back down on their threats to blockade the oil operation of PT Caltex Pacific Indonesia (CPI), following a meeting among community leaders.

Leaders at the meeting, which took place at the secretariat of the Forum of Communication of Riau Community Leaders on Jl. Kebangsari Komplek, agreed that the local people would not take action against the firm's oil operations.

Al Azhar, the coordinator of the alliance of Riau people (Simpul) which planned to take over the Coastal Plains Pekanbaru (CPP) oil block, said that they wanted an agreement between the government, state-owned oil and gas company Pertamina and the Riau legislature to be signed in Jakarta on Tuesday and published in an official gazette.

In Jakarta, top officials from the Ministry of Energy and Mineral Resources and Pertamina met on Tuesday with Riau legislators. The government agreed to hand over the management of the CPP oil block to the Riau administration in the future after the province had the necessary human resources.

Caltex's contract for the CPP oil block, which is managed by Pertamina, was supposed to expire on Aug. 8, but Pertamina extended the contract for another one-year term. This had evoked anger among locals, who have long demanded full control over the management of the CPP block once the contract with Caltex expired.

The CPP oil block is one of four blocks operated by Caltex in Riau. Several years ago the CPP block produced about 70,000 barrels of crude oil per day, but the current production level has dropped to 50,000 bpd after Caltex halted new investments due to growing uncertainty over the ownership of the oil block.

"We want this agreement from the government to be legalized," Al Azhar said, adding that the point was one of seven recommended at Wednesday's meeting.

Another recommendation was that the blockade and any action taken by protesters would not be the responsibility of the alliance.

Earlier in the day Riau figures Edyanus Herman Halim and Tabrani Rab said no one could guarantee that the people would cancel their plan to blockade the oil firm's operations.

Edyanus, the secretary of the Expert Council of Riau and a lecturer at Riau University, and Tabrani, a leader in Riau, said at separate interviews on Wednesday that they could not promise the people would not "take up arms" and blockade the oil firms' operations.

"They have been cheated many times in this business. And (Tuesday's) deal which was reached by the Riau legislators and the central government did not mention any compensation for the people of Riau. We want US$26 million in compensation, or ten percent of the expected financial profit to be gained by the firm from the one-year contract extension. We are not talking about money, but about people's dignity," Edyanus said.

Tabrani said that the deal was a good start (for Riau), and hinted that people living in the areas where Caltex distribution pipings were located held a "grudge" against the oil firm because of its management of the CPP block.

Tension in Riau over the CPP block dispute has caused the police there to declare a level one alert around the firm's operations.

More than 1,000 personnel from the North Sumatra and West Sumatra Military Commands were deployed to back up the Riau Police in case there was any unrest. (36/37/sur)