Pertamina gets new chief

Fitri Wulandari, The Jakarta Post, Jakarta

The government has named Ariffi Nawawi as president director of state-owned oil and gas firm Pertamina to replace Baihaki Hakim, raising concern among some that the firm, once infamous as the country's largest den of corruption, could regain that reputation.

Roes Aryawijaya, deputy to the minister of state-owned enterprises, said on Wednesday that Pertamina had officially become a limited liability company and a new board of directors had been named.

"Pertamina will be led by Ariffi Nawawi. The regulation to change the company into a limited liability company has been signed by related ministers," he said.

Ariffi was previously a Pertamina director.

The appointment shocked many oil and gas analysts, as well as corruption-watchers in the country, as Baihaki is known as a clean figure, while Ariffi has featured in at least one graft case involving Pertamina.

There is not as yet any evidence to prove Ariffi's involvement in the case, but his appointment has prompted questions as to whether the current administration is serious in stamping out corruption in the firm or else wants to abuse it again as a cash cow, just as former President Soeharto's administration did for several decades.

Baihaki, the former president of PT Caltex Pacific Indonesia, a subsidiary of American energy giant ChevronTexaco, is lauded by many parties for his efforts to curb corruption in the firm.

Apart from Nawawi, the government also appointed Hari Purnomo as new downstream director, Bambang Nugroho as upstream director and Alfred Adrianus Rahimone as finance director. Hari was Pertamina's former fuel distribution director, who, in that position, had good connections with gas station owners.

The government has also named Minister of State Enterprises Laksamana Sukardi chief commissioner, with Roes Aryawijaya, Indonesian Bank Restructuring Agency head Syafruddin Temenggung, director general of budget affairs at the Ministry of Finance Anshari Ritonga and director general of oil and gas at the Ministry of Energy and Mineral Resources Iin Arifin Takhyan as commissioners.

According to Roes, the regulation for the appointment of Pertamina's new board of directors and commissioners was signed by President Megawati Soekarnoputri, Laksamana, Minister of Energy and Mineral Resources Purnomo Yusgiantoro and Minister of Finance Boediono.

At least one legislator was quick to criticize the reshuffle.

Djusril Djusan, of House of Representatives Commission VIII for energy and mineral resources, said he was concerned that Ariffi had been mentioned in Pertamina graft cases.

According to Djusril, Ariffi's name came up in a case related to the procurement of additives for the Balongan refinery, Indramayu, West Java. He confirmed that the case was among 11 relating to Pertamina being probed by the House Special Working Committee on Pertamina.

The committee was set up on Sep. 27, 2001, to probe alleged corruption at Pertamina in a bid to recover state losses and eradicate corruption at the company.

In June this year, the committee published a report stating that the 11 cases could have caused US$1.4 to $1.7 billion in losses to the state.

"Over the next two years, Pertamina won't become the company that we might have hoped for -- one that could compete with international companies," Djusril told The Jakarta Post.

Another commission member, Priyo Budi Santoso, acknowledged that Ariffi's past history could pose a credibility problem.

However, he said, Ariffi, who is a Pertamina career official, should be given a chance to prove himself.

"There is no evidence yet that he (Ariffi) was involved in the case. So, let's just see how he will perform," Priyo told the Post in a telephone interview.

Meanwhile, Ariffi said he would continue with the programs of the previous board of directors.

"We shall carry out programs from the previous board of directors but the focus will be on organization, human resources and marketing," Ariffi announced.

For marketing, Ariffi said Pertamina would be more consumer- oriented.

Pertamina would also focus on the petrochemicals industry, which, he said, should promise more lucrative returns to the company.