Lapindo pays partial compensation to eight companies; 15 more waiting

The Jakarta Post ,  Jakarta   |  Fri, 05/18/2007 7:56 AM

Indra Harsaputra, The Jakarta Post, Sidoarjo

The company at the center of the mudflow disaster in Sidoarjo, East Java, has paid 20 percent of the compensation due eight companies affected by the mud, with the remaining money to be paid by next December.

Bambang Prasetyo Widodo, operational director of PT Minarak Lapindo Jaya, which has been appointed by Lapindo Brantas Inc. to handle compensation payments, said the company paid Rp 42.7 billion of the Rp 245 billion in compensation owed to the companies.

The money is to compensate the companies for land, buildings and equipment lost in the mud.

""We will pay the remaining money by December 2008. We don't want to postpone payments. We hope all mudflow victims trust Lapindo and are willing to be patient,"" Bambang said Wednesday.

The eight companies that received compensation payments all signed agreements with Lapindo.

Another 15 companies have yet to receive any money because, according to Minarak, they have yet to reach agreement on the amount of compensation due them.

Originally, an association of companies affected by the mudflow proposed total compensation of Rp 527.58 billion.

Several of the companies that did receive money from Lapindo are still unhappy with the level of compensation, particularly the valuation of their land.

The owner of rattan exporting company CV Karya Asih Karunia, Willy Viktor, said he accepted the compensation because he had run out of options and was tired of fighting.

""This is difficult for us. But we don't want our workers to be without jobs for too long because we aren't operating. We will use the compensation money to build a new business.""

Agus Muldya of consulting company Indo Solution urged the government to find a real solution for the mudflow victims.

""Lapindo should be responsible for paying compensation. However, the government should not issue policies that might confuse businesspeople.""

He said the government needed to provide legal certainty and security for affected businesses.

In addition to the money paid to the eight companies, Lapindo has paid Rp 6.925 billion in compensation to 75 farmers who lost a total of 270,663 square meters of rice fields.

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