Riau Police declare top alert in Caltex operation
JAKARTA (JP): Police in oil-rich Riau province were on top alert on Tuesday to anticipate a planned blockade by angry local people on the oil operation of PT Caltex Pacific Indonesia (CPI).
Riau Governor Saleh Djasit said on Tuesday the top alert status was made to better protect CPI's operation in the province.
"Don't be surprised with the move...it's for the sake of everybody," Saleh was quoted by Antara as saying.
A "general gathering" of Riau people on Saturday threatened to blockade CPI's operation, in particular the CPP oil block if central government in Jakarta did not immediately revise its recent decision to extend the contract with CPI to manage the Coastal Plains Pekanbaru (CPP) oil block. The blockade is scheduled to start on Thursday.
The protesters also planned to sabotage CPI's oil operation by creating leaks in crude oil pipelines and occupying sites.
Meanwhile, CPI spokesman Renville Almatsier said the police had deployed more than 1,000 personnel to safeguard several operation areas of the company, particularly in Dumai, Duri and Rumbai because they were located relatively close to local villages.
Other operations in Minas are quite safe, he said, adding that the CPP oil block was also comparatively safe because of its remote location.
"We're quite worried if the action is carried out on Thursday, particularly if it is at the Dumai oil tanks," he told the Jakarta Post, adding that the oil tanks at Dumai are located at the oil terminal ready for shipment.
Renville said that if the Dumai oil tanks are sabotaged, CPI would be forced to halt oil production from all its oil fields, prompting a potential loss to CPI of US$9 billion a day.
He hoped the ultimatum would not materialize because it would damage the country's reputation in the international business community.
CPI's contract with the CPP oil block was supposed to expire on August 8 but President Megawati Soekarnoputri issued a decree earlier in the month extending the contract for another year.
Riau has long demanded control over the management of the CPP oil block once the CPI contract expires. But central government has insisted that the extension of the CPI contract was crucial to ensure the continuity of production as Riau neither has the financial resources nor the skills to operate the oil block for now.
But the protesting Riau people have demanded that if the CPI contract was extended, 30 percent of the net profit from the operation of the CPP oil block should be transferred to the province and that more local people should be employed by the company.
The government said on Monday it would maintain its recent decision despite the intensifying protest.
Top officials from the Ministry of Energy and Mineral Resources, Pertamina met with senior members of Riau provincial legislative council on Tuesday. The government agreed to hand over the management of the CPP oil block to Riau in the future after the province has the necessary resources.
The CPP is one of four oil blocks operated by CPI in Riau province under a production-sharing contract with state oil and gas company Pertamina.
Several years ago, the CPP block produced around 70,000 barrels per day (bpd), but the current production level has dropped to 50,000 bpd after CPI decided to halt new investment last year due to growing uncertainty over the future ownership of the oil block.
Caltex, a joint venture of United States-based oil companies Chevron and Texaco, produces around 700,000 bpd of oil at present, making the company the largest crude oil producer in Indonesia.(05)