Minister accused of role in KBC debacle

Privately, Indonesian professional groups are pushing for the authorities to investigate Minister of Energy and Mineral Resources Purnomo Yusgiantoro in connection with the Karaha Bodas corruption case.

The Madani Professional Society, a grouping of Muslim professionals, has urged police to expand the investigation into Purnomo, while another group, the Indonesian Advocacy Reform Institute (LARI), has reported the minister's involvement in Karaha to the Anticorruption Commission.

It is not yet known if either the police or the commission will move against Purnomo.

His involvement in Karaha dates back to 1989 when he was appointed as a consultant to PT Sumarah Dayasakti, which owns a 10 percent stake in the Karaha Bodas Company (KBC). KBC was the main investor in the aborted Karaha Bodas geothermal power plant.

During the early 1990s, Purnomo became a member of the Geothermal Implementation Team at the Ministry of Mining and Energy, which was also known as the Team Nine -- because it had nine members.

The team advised the minister about geothermal matters, including about how to award contracts to private investors and negotiate electricity prices.

Based on its advice, the minister endorsed KBC's proposal and later, KBC signed an operations and energy sales contract with Pertamina and PLN to supply power at what analysts now consider exorbitant prices.

Following the signing, KBC paid a US$10 million "commitment fee" to parties involved in the deal. LARI alleges Purnomo was one of the parties who received the money.

Purnomo has denied the allegations but did not deny he was a consultant working for PT Sumarah and at the same time as he was a member of Team Nine -- an apparent conflict of interest.

The minister said the corruption in Karaha Bodas emerged because Pertamina and PLN had lost an earlier international arbitration court ruling against KBC.

If Pertamina and PLN had won the arbitration, the corruption case would not have emerged, he said. -- JP