McDermott gets go-ahead for Natuna gas pipeline project
McDermott gets go-ahead for Natuna gas pipeline project
JAKARTA (JP): Minister of Mines and Energy Kuntoro
Mangkusubroto said on Friday that PT McDermott Indonesia may go
ahead with the construction of a natural gas pipeline linking
Natuna island in the Southeast China Sea to Singapore despite
protests from some legislators.
The construction company should not hesitate to build the 650-
kilometer underwater pipeline, Kuntoro said.
"The company can go ahead with the project because it has met
all administrative and legal requirements for the project,"
Kuntoro said on the sidelines of a meeting with the House of
Representatives's special team for deliberation of the oil and
gas bill.
"Comments from legislators cannot annul the decision (that
selected the company for the project)," he added.
Several legislators have voiced concerns over the West Natuna
consortium's selection of McDermott for the project. McDermott
won the project through open bidding involving four international
companies.
The consortium comprises Conoco Corp. of the U.S., Premier Oil
of Britain and Gulf Resources of Canada.
The pipeline will be used to transport natural gas extracted
from the three's gas fields west of Natuna island to Singapore
for 22 years, starting from 2001.
State oil and gas company Pertamina approved the consortium's
selection of McDermott for the project last month despite the
strong protests from legislators.
The legislators said McDermott was not eligible for the
project due to its partnership with former President Soeharto's
crony Mohammad Bob Hasan in McDermott Indonesia.
The legislators charged McDermott with abusing its political
connections to obtain many projects in the country's oil and gas
industry during Soeharto's era.
Legislator Priyo Budi Santoso of the Golkar Party called on
the Attorney General's Office early last week to investigate
alleged mark-up practices conducted by McDermott Indonesia during
Soeharto's era.
Priyo said that if the company was proved to have committed
mark-up practices, it should return to the government the profit
it had accumulated through these practices.
He also called on Pertamina "to disqualify the company for the
sake of justice" due to its collusive practices in the past.
McDermott has refused to talk to the local press as of last
year, when the gas pipeline project became a controversy.
Kuntoro called on Pertamina and the House to end the
controversy by forming a special team to thoroughly investigate
whether there were irregularities in the consortium's selection
of McDermott for the project. (jsk)