KPK, Pertamina to Prevent Corruption in New Refinery Construction
27 May 2016 21:30 WIB
TEMPO.CO, Jakarta - The Corruption Eradication Commission (KPK) is in the process of drafting a Memorandum of Understanding (MoU) with PT Pertamina in a bid to prevent corruption in the structure of the state oil company.
"The MoU is specifically related [to the prevention of corruption] in the construction of Pertamina's new oil refineries," KPK deputy for graft prevention Pahala Nainggolan at Pertamina's Headquarter in Jakarta on Friday, May 27, 2016.
Nainggolan explained that the MoU was drafted to enable the KPK to assist Pertamina in monitoring the progress of the company's new refinery projects, which was often hampered by officials at the provincial level.
"This indicates that there might be corruption, especially when it comes to the issuance of permits, which has been known and reported by other companies too," he added.
Nainggolan also said that KPK's decision to court Pertamina was aimed at turning Pertamina into its pilot project to show that state-owned companies in Indonesia could be free from corruption. In fact, KPK has asked Pertamina to divulge the recipe behind its success in reducing its total supply losses to below 0.5 percent. The recipe is to be implemented and replicated by the KPK in the Upstream Oil and Gas Regulatory Special Task Force (SKK Migas).
KPK also chose Pertamina because the state oil company had managed to save US$22.62 million throughout the first quarter (Q1) of 2016 by streamlining the way the company’s management. In April 2016, the figure increased to US$26.87 million.
In April 2016, Pertamina's total supply losses stood at 0.19 percent, far below the globally accepted standard of 0.5 percent, and below the target that Pertamina has previously set at 0.3 percent. Since the company decided to streamline its' management in a bid to increase the company's efficiency - and therefore, performance - two years ago, its' total supply losses had decreased by 54 percent.
"Pertamina's model should be replicated and utilized by companies in other sectors, and as such, we need to know what stood in their way - the obstacles, barriers and all - no holds barred," Nainggolan said.
VINDRY FLORENTIN
