Sigit questioned in Balongan scandal

JAKARTA (JP): A son of former president Soeharto, Sigit Hardjojudanto, was questioned at the Attorney General's Office on Wednesday for his alleged involvement in the marking up of the Balongan oil refinery project in Indramayu, Cirebon, West Java, in 1989 and 1990.

Sigit, accompanied by lawyer Juan Felix Tampubolon, was examined for over four hours from 9 a.m. by prosecutor Umbu Lage Losara.

He was questioned in connection with the marking up of the value of the project by US$113 million.

Sources at the Attorney General's Office said that there was a letter from Foster Wheeler in July 1989, addressed to the Director of Processing at state oil and gas company Pertamina, Tabrani Ismail, requesting former Soeharto's reference for the then minister of mining and energy Ginandjar Kartasasmita. "A presidential decree about the cooperation between Pertamina and a foreign company and about the development and construction of the Balongan oil refinery is required," the letter said as reported by Antara.

It is alleged that Sigit, along with two other businessmen, Eri Putra Odang and Bing Kintamani, were believed to have placed pressure on Pertamina officials to take up Foster Wheeler's offer.

Eri allegedly received US$60 million or four percent of the price offered by Foster Wheeler.

It was believed that the price of the project was marked up, especially in "processor licensing" at the United Oil Petroleum.

Tampubolon, however, said after the examination that his client knew nothing about the case.

The Balongan refinery was built from 1990 to 1995 by Pertamina with a consortium led by Foster Wheeler of Britain as the main contractor.

Pertamina built the refinery at a cost of $2.45 billion, but it was believed that the real cost of the project was only $1.6 billion.

Sigit's younger brother, the fugitive Hutomo "Tommy" Mandala Putra, was sentenced to 18 months in prison by the Supreme Court last September for corruption. (sim)