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)