Indonesia: Pertamina sanctioned for Balikpapan oil spill

Karina M. Tehusijarana The Jakarta Post 17 Apr 18;

The Environment and Forestry Ministry has told state-owned oil and gas company PT Pertamina to take responsibility for the restoration of polluted Balikpapan Bay in East Kalimantan, given its role in the recent oil spill that has devastated the local environment.

Responsibility for cleaning up the bay and its surroundings is one of the sanctions imposed by the ministry on the firm, Minister Siti Nurbaya Bakar said on Monday.

The ministry found that Pertamina’s refinery in Balikpapan lacked an early-warning system and had no automated monitoring. Siti said the sanctions would also compel the company to improve its pipeline inspection and prevention systems, which the ministry found to be sub-par. “We’ve imposed administrative sanctions on Pertamina’s RU V [Refinery Unit V], including the restoration of the environment from the pipeline leak,” she told lawmakers at the House of Representatives Commission VII overseeing energy and mineral resources and environmental affairs on Monday.

“[Pertamina] is the permit holder in the area and that is where we see [the responsibility],” Siti added.

The ministry had previously determined that the spill was caused by a burst undersea pipeline connecting Pertamina’s Lawe-Lawe terminal to its refinery in Balikpapan city. The leak on March 31 led to a fire that claimed five lives as well as causing ecological damage regarded as the largest environmental disaster in Indonesia in the past 10 years.

Around 40,000 barrels of crude oil affected 7,000 hectares of the bay. The oil slick also affected about 240 ha of mangrove forests and resulted in the deaths of protected species living in the bay.

Pertamina president director Elia Massa Manik said the company was prepared to improve its monitoring systems and had already taken part in a cleanup and environmental-restoration activities in the immediate aftermath of the spill.

Besides opening medical posts at eight locations around the area and a public kitchen, the company had allocated Rp 785 billion (US$57.3 million) for a labor-intensive environmental cleanup program involving 5,239 community members, he added.

Pertamina refinery director Toharso added that, regardless of who was at fault, the company was ready to pay out compensation for the families of those who died in the fire and for all those who had suffered losses because of the spill.

“We will ignore for the moment who was wrong and who was right,” he said. “Based on our sense of social responsibility, we have immediately started the cleanup up process and paid damages.”

Siti added that the ministry was still conducting its evaluation of the monetary value of the environmental damage from the spill, which would be used in civil proceedings against the responsible parties.

“If we take Balongan as a benchmark, this is many times that,” she said, citing a 2008 oil spill in Balongan district in Indramayu, West Java, which she said resulted in about Rp 100 billion in damages.

House Commission VII invited all related parties to the first meeting to discuss the oil spill disaster in Balikpapan on Monday.

Meanwhile, East Kalimantan Police special crimes director Sr. Comr. Yustan Alpiani said the investigation was ongoing and awaiting results from comparative analysis of material found on Panama-flagged collier MV Ever Judger’s anchor with that from the broken pipeline.

“We just need those results and testimony from expert witnesses to conclude the investigation and determine a suspect,” Yustan said in the meeting.

Balikpapan Port master Sanggam Marihot told lawmakers that there was an indication that the Panamanian vessel passing through the area had accidently dropped anchor in a restricted area, dragging the pipeline and causing it to burst.

Members of House Commission VII urged the relevant ministries, particularly the Energy and Mineral Resources Ministry, to improve its oversight of Pertamina’s other undersea pipelines to avoid such an incident from happening again.

“Commission VII calls on the Energy and Mineral Resources Ministry to conduct a comprehensive review of all of Pertamina’s vital facilities and to carry out periodic monitoring and oversight to ensure that regulations are enforced stringently and correctly,” commission chairman Gus Irawan Pasaribu said, reading out the commission’s conclusion at the end of the meeting.

Deputy Energy and Mineral Resources Minister Arcandra Tahar, who was also present, said the ministry had already acted according to its responsibilities saying that it had sent its oil and gas inspector to the field to conduct an intensive investigation in the area to determine any violations.