Pertamina promises to probe graft report

Pertamina promises to probe graft report

JAKARTA (JP): State-owned oil and gas company Pertamina
promised on Thursday it would probe graft allegations amounting
to Rp 1.054 trillion (US$122 million) in a recent audit by the
Development and Finance Comptroller (BPKP).

Pertamina spokesman Ramli Djaafar said the company was always
open to BPKP's investigations and would take legal actions
against any findings of corrupt activities.

"To prove the existence of corruption, further study of the
findings is required," Ramli said in a press statement.

BPKP's audit encompassed Pertamina, its subsidiaries and its
production sharing partners, covering the 1999/2000 fiscal year
ending March 31.

Quoting the audit, Ramli said that BPKP found possible
irregularities in Pertamina activities amounting to Rp 208
billion, of which some Rp 20 billion had been clarified.

Findings of possible irregularities in Pertamina's production
sharing partners totaled Rp 820 billion, he said, with cases
involving Rp 515 billion clarified.

He said that irregularities in Pertamina's subsidiaries
totaled Rp 3 billion, of which cases worth Rp 1.5 million had
been clarified.

He said that BPKP based its allegations of graft based on
irregularities in the procurement of goods and services,
unreasonable payments for work, fictional projects, faked
documents, mark up practices, and nepotism.

Kompas reported Wednesday that BPKP's finding ranked Pertamina
as first in corruption among all state-owned companies and
agencies.

BPKP indicated 212 corruption cases in Pertamina worth Rp 1.05
trillion, the daily said.

Ranking second is the office of the State Minister of
Investment and State Enterprise Development with 87 cases worth
Rp 630 billion, it said.

While the national logistic agency (Bulog) ranked third with
17 cases involving Rp 213 billion.

The findings of BPKP add to the list of alleged corruption
cases in Pertamina, following the Price WaterhouseCoopers audit
on Pertamina's inefficiency last year, which later became the
impetus for the company's restructuring program.

The independent auditor revealed inefficiencies in Pertamina
totaling US$6.1 billion during the period of April 1, 1996 to
March 31, 1998.

Based on the audit, Ramli said Pertamina had forwarded 159
contracts to the Attorney General's Office that were suspected of
containing elements of corruption. (bkm)