Timor Sea oil spill: Thai firm says it will pay claim, if Indonesia has evidence

The Jakarta Post 22 Dec 10;

Thailand-based gas and oil producer PTT Exploration and Production (PTT EP) has promised to pay compensation for damages caused by an oil spill in the Timor Sea as long as Indonesia has sufficient evidence to support its claim.

“We will pay as long as it can be proven by evidence agreed by both parties,” executive vice president Luechai Wongsirasawad told reporters in Jakarta on Tuesday.

He added that his company acknowledged the economic and social impacts of the oil spill on the Indonesian fishery industry.

Earlier, Indonesia demanded Rp 23 trillion (US$2.58 billion) in compensation for the damages resulting from the oil spill, which was caused by a blowout at the Montara platform off the northwest coast of Australia on Aug. 21 last year. The spill affected nine Indonesian regencies around the Timor Sea, reportedly polluting 70,341 square kilometers of water and coastline.

An analysis by the Environment Ministry showed that pollutants in the Timor Sea had exceeded the tolerable levels set by the Indonesian government as an impact of the oil spill caused by PTT EP Australasia, a subsidiary of PTT EP.

Local fishermen’s catches also reportedly dropped, while thousands of tons of shallow-water fish and whales were found dead due to the spill of up to 500,000 liters of crude oil a day into the Timor Sea.

The International Maritime Organization (IMO) said marine life and coral reefs, along with mangrove ecosystems, would need two and 10 years respectively to recover.

Wongsirasawad said that in a meeting in Singapore last weekend, both the Indonesian negotiation team and his company agreed to prioritize the case to resolve the impacts of the spill on the fishery industry.

As the first step, he said, his company would conduct a joint survey with the Indonesian government around Rote Island in East Nusa Tenggara, claimed to be worst hit by the incident, to find out the extent of the oil spill entering Indonesian waters.

“We have agreed that the oil spill came to Indonesia’s waters, but we have yet to agree on what extent it reached the shores,” he said. A recent study conducted by the Australian government and funded by
PTT EP concluded that the oil slick did not reach Australian or Indonesian shorelines.

“The study shows that the nearest point reached was 91 kilometers from Rote Island, while Indonesia’s study indicates that it reached 51 kilometers from the island,” he said.

Wongsirasawad also said that his company and the Indonesian government would calculate resources impacted by the oil spill at the end of February next year.

“Upon completing these stages, we will calculate the economic losses that we should pay,” he said, adding that currently his company had not yet allocated any budget for initial compensation for direct losses suffered by local fishermen. (lnd)


Earlier, Indonesia had demanded Rp 23 trillion in compensation for the damages resulting from the oil spill.