Zatapi case may point to conflict in Pertamina

Olivia Dameria ,  The Jakarta Post ,  Jakarta   |  Wed, 11/12/2008 10:45 AM  |  Business

The recent publicity over a graft allegation involving state oil and gas company PT Pertamina, concerning the import of Zatapi crude oil, may stem from a dispute within the company's top officials over procurement contracts.

Sources at the company said the case was unlikely to have ended up on a police desk if the importation had not conflicted with the interests of some of the company's executives who had profited for a long time from participating in procurement arrangements.

"The case erupted because there are some officials who can no longer make a profit out of the company because we prefer to use the Zatapi. An audit from the BPKP (State Development Finance Comptroller) has cleared Pertamina of any irregularity in the case," said a source.

While the police are currently investigating the case, a BPKP audit report dated Nov. 4 showed there was no evidence so far that the Zatapi import had violated any regulations.

"Thus far, the procurement of the Zatapi crude has been based on the existing regulations and has contributed positively to the business of the company (Pertamina)," said BPKP in an audit signed by its deputy Ardan Adiperdana.

However, the BPKP said if there was evidence of state losses based on this operational audit, then it would follow up with an investigative audit to spot how such damage was done.

A letter accompanying the audit, signed by BPKP chairman Widi Widayadi, to President Susilo Bambang Yudhoyono insisted the police take any necessary measures on the result of the audit to prevent the Zatapi case from developing into a political issue.

Didi did not specify what he meant by a "political issue".

BPKP spokeswoman Ratna Tianti confirmed the authenticity of the audit.

However, she said the audit was not a guarantee that transactions were free of state losses and it should be the main focus of the police to check this.

The Zatapi fiasco started when Singapore-based oil importer Gold Manor won a Pertamina-sponsored tender to supply 600,000 barrels of Zatapi crude oil to Indonesia in December last year, and began shipping it to a Pertamina refinery in Cilacap, Central Java, in February, 2008.

The police understood the state had suffered some Rp 523 billion (US$47.5 million) of losses as a result of the importation because Gold Manor's tender bid was incomplete since it did not include a detailed breakdown of the contents of the Zatapi oil.

The National Police named four Pertamina staff-members and a director of Gold Manor as suspects in the case after being investigated based on allegations that they had enriched themselves during the procurement of Zatapi crude oil last year.

Pertamina president director Ari Soemarno has repeatedly denied any irregularities in the Zatapi imports, saying it did not cause any losses to Pertamina.

Pertamina spokesman Anang Noor also denied speculation that the Zatapi case was part of a business battle between vested interests in Pertamina, saying the company could not comment on accusations from irresponsible people.

"We have a system which is called 'whistle blower', a kind of mechanism that encourages people inside and outside our company to report suspicious things. But we are completely transparent and welcome any inputs from the public to help us do business the right way for the national good," he said.

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