Workers' protests threaten Badak natural gas supply
Workers' protests threaten Badak natural gas supply
JAKARTA (JP): Workers' protests at gas company Vico Indonesia
Ltd might cause a total cut in the natural gas supply to the
country's largest liquefied natural gas (LNG) producer PT Badak
in Bontang, East Kalimantan, a spokesman of state oil and gas
company Pertamina said here on Saturday.
Spokesman for Pertamina's Foreign Contractors Management Body
(BPPKA) Sidick Nitikusumah said that workers for one of Vico's
subcontractors PT Perdana Karya, were trying to gain control over
Vico's main gate in order to interrupt the gas supply.
He said that some 250 workers have been on strike since early
August but the police managed to disperse them on Friday as they
were trying to gain a full control of Vico's operation.
"The workers have been working here for many years and know
what to do to hurt the company's operation," he told The Jakarta
Post over the weekend.
The Badak plant, which has a production capacity of
approximately 22 million metric tons of LNG per year, is jointly
operated by Pertamina and its production sharing partners Vico,
Unocal Indonesia and Total Indonesie.
The plant receives its gas supplies from nearby gas fields
operated by Vico, Unocal and Total.
A pipeline running through Vico's main gate supplies the Badak
plant with 3.4 billion cubic feet (bcf) of gas per day, of which
Vico supplies 1.4 bcf and Total Indonesie 2 bcf.
"If they manage to take over the main gate for a longer
period, it will also threaten Badak's operation," Sidick said.
He said that although the blockade had not affected the
company's production, supply of raw material and logistics had
been disturbed during the blockade.
Meals, Sidick said, could only be delivered under police
protection as the company's vehicles were frequently stoned.
According to him, the striking workers intend to disrupt
Badak's operation by blockading gas supplies from Vico's
pipeline.
The LNG plant faces its second threat to operations after
local farmers temporary blockaded Vico's main gate earlier this
year to demand compensation for damages the company allegedly
caused to their farms.
Sidick said that Pertamina and Vico were currently seeking a
legal solution to the farmers' demands and accusations at a local
court.
The unrest surrounding Badak's operations comes amid
Pertamina's all-out effort to find LNG buyers.
India had shown interest in purchasing LNG from the Badak
plant, and sent last month a delegation here, but it fell short
of signing a contract.
"At present the workers have gathered around the gate,
mingling with locals," Sidick said.
He said that even the locals had lost their sympathy for the
striking workers because of their harsh attitudes.
He said the striking workers were harassing their colleagues
who wanted to keep working.
"If it weren't for the company, the locals would have attacked
the workers themselves," he said, explaining that Vico had
persuaded the locals to keep out of this affair.
Sidick said that the striking subcontractor's workers were
demanding a salary increase equal to that of Vico's workers.
Furthermore, the workers wanted assurance that they would not
be dismissed once their contract expired, he said.
"These are indeed difficult demands," Sidick added.
However, he said the company expected negotiations with the
workers to start next week.
He said a tripartite negotiation would be held that included
the Indonesian Prosperity Labor Union (SBSI), which was
organizing the strike.
SBSI is also the labor union that forced giant coal mining
company PT Kaltim Prima Coal (KPC) to close down its operations
in East Kalimantan.
KPC's operation remains shut despite high level efforts by the
company, SBSI and the government to reach an amiable agreement.
"We hope we can resolve this problem quickly and in a peaceful
manner," Sidick added. (bkm)