Tuesday, 31 July, 2012 | 14:51 WIB
Testing Times for Chevron in Indonesia
TEMPO Interactive, Riau:The AGO believes graft indications have been found in Chevron Indonesia’s bioremediation project, one that cost the state Rp 200 billion in losses. Both the AGO and Chevron are preparing evidence to each support their claims.
As far as the eye can see, yellowish plains of soil are visible. Not far from those plains, mounds of black earth forming small hills appear. On that day, apart from a group from Pekanbaru, there was no other human activity in that corner of the Minas oil field - around 30 kilometers from the capital city of Riau.
“This is the site where we process the oil waste products,” said Nur Lela, leader of the group from US-based energy company Chevron Pacific Indonesia on Thursday last week. Lela is certain that, found within the layers of yellowish soil, millions of bacteria are hard at work. They are neutralizing the soil from crude oil waste products.
Lela explained that the black mounds are made up of oil-contaminated soil, dredged up and transported from other sites. The soil is piled up as it is because it has not yet been processed. The yellowish soil indicates that it has almost finished being normalized through the bioremediation process.
This technique relies on the efficiency of decomposing microbes in the soil to remove oil waste products. In order for the decomposing bacteria to develop successfully and work actively, the mounds of polluted soil are added to with fertilizer, watered, and then turned over. The soil is said to be normalized if the crude oil content is one percent or less. The soil normalization cycle with this method can take three to six months.
Wahyu Budiarto, Chevron Indonesia’s general manager for southern Sumatra, said that at this moment, Chevron owns nine bioremediation facilities. Five of them are located in Minas. The remainder are in Duri, another oil field in Riau.
Beginning in 2003, according to Chevron’s records, their bioremediation technique has normalized more than half a million cubic meters of land. The processed soil has already been used to reforest 60 hectares of land in Riau. “We are pioneers in bioremediation techniques,” Yanto Sianipar, the Vice President of Chevron Pacific Indonesia, told Tempo.
However, that recorded “success” has not immediately freed Chevron Indonesia from the problems which have beset it since October last year. On the contrary, five executives of Chevron have been named by the Attorney General’s Office (AGO) as suspects linked to alleged corruption practices in the bioremediation project which they are so proud of. The prosecutor alleges that the bioremediation projects are fictitious. Chevron has denied this.
The crux of the case lies with the AGO stating that there are indications of upstream oil and gas regulator, BPMigas, paying out Rp 200 billion from the state budget to Chevron, for the latter’s “fictitious” program from 2003 to 2011. The AGO claims that Chevron hired incompetent contractors for the bogus bioremediation project, which never ended up being completed. Chevron has denied this, claiming that the two companies hired – Green Planet Indonesia and Sumigita Jaya – were competent, and since the work was to be paid for on a cost recovery basis, Chevron was reimbursed by BPMigas. It is not only the suspects who are feeling the heat in the case. Until two weeks ago, 61 current and former employees of Chevron were examined by prosecutors. “We’ve been made really busy,” remarked Yanto.
The legal problems which beset Chevron began on Oct. 5, 2011. At that time, an investigator, working under the Junior Attorney General for Special Crimes, issued a warrant to investigate cases of alleged corruption in the creation of the bioremediation project by the company which produces 357,000 barrels of petroleum per day.
According to AGO spokesman M. Adi Toegarisman, the investigation into cases of alleged corruption at Chevron began with a complaint from the public. The complainant reported that the bioremediation project, which had been subcontracted by Chevron to other companies since 2006, was riddled with problems.
The prosecutors’ investigations revealed that, the two companies appointed by Chevron, Green Planet Indonesia and Sumigita Jaya, were only general contractors. They did not have expertise or special certificates in the field of bioremediation. Therefore, prosecutors suspected that the bioremediation project was bogus or was not being carried out as it should have been. This was despite the fact that, since 2003, Chevron had always reclaimed the costs of bioremediation to the state through BP Migas. The AGO estimates that state losses from this bogus project reached US$23.36 million, or Rp.200 billion.
After examining reports and witnesses, last March 12, the AGO named seven people suspects.
Prosecutors applied Articles 2 and 3 of the Corruption Law to charge the suspects. Prosecutors accuse them of enriching themselves or their corporations through causing state losses. Each Article carries a maximum sentence of a 20-year jailterm.
Jajang Jamaludin, Anton Aprianto, Riyan Nofitra (Riau)