Marubeni accused of dumping pipe for West Natuna project
Marubeni accused of dumping pipe for West Natuna project
JAKARTA (JP): The Association of Indonesian Steel Pipe
Manufacturers accused Japanese trading house Marubeni on Friday
of dumping practices to win the tender to supply steel pipes for
the West Natuna gas pipeline project.
Association chairman Warasdimulya said local steel pipe
manufacturers were able to meet the technical requirements
demanded by project owner PT McDermott Indonesia.
However, Marubeni won the tender through unfair business
practices, he said.
"Local producers are capable of meeting the technical criteria
demanded by McDermott but the price of US$539 per ton set by
McDermott for the pipes was unreasonable," Warasdimulya said in a
statement.
The Indonesian trade attache in Tokyo informed the association
the $539 per ton agreed upon by Marubeni was about half of the
price of pipes sold by Japanese steel producers in its home
country
McDermott Indonesia, a subsidiary of American construction
firm J. Ray McDermott SA, will construct a 650-kilometer
underwater pipeline to carry natural gas from fields owned by the
West Natuna Group consortium to Singapore.
The consortium comprises Conoco Corp. of the United States,
Gulf Resources of Canada and Premier Oil of Britain.
The consortium will supply gas to Singapore's Sembawang Gas
for 22 years beginning in 2001.
The Natuna group awarded the construction project to McDermott
through an open and transparent bid involving four international
construction companies.
An informed source at McDermott told The Jakarta Post the
company selected Marubeni to supply the pipes for the project in
"transparent and open" bidding last year. Also taking part in the
tender was local pipe producer South East Asia Pipe Industries
(SEAPI), a unit of Bakrie Group.
The source said bidding was open to all local pipe producers,
but only SEAPI meet the technical requirements.
Marubeni won the tender because of its lower price, he added.
Warasdimulya said McDermott would begin importing 150,000 tons
of steel pipe from Marubeni next month with a 25 percent import
duty exemption provided by the government.
He said 150,000 tons of pipe was a significant quantity for
local steel pipe makers, which had cut their annual output to
200,000 tons from 1.5 million tons due to weak demand during the
economic crisis.
"The importation of such a large quantity of steel pipes
through dumping, coupled with import duty facilities provided by
the government, has aggravated the hardships currently being
experienced by the national pipe industry. So, it is only
reasonable to expect the national pipe industry will go bankrupt
in the near future," he said.
He called on the government to slap antidumping fees on the
pipe imports from Japan to protect local producers against
dumping.(jsk)