Frontline to appeal in Pertamina's controversial tanker sale

Swedish shipping company Frontline Ltd., will appeal against the ruling of the Business Competition Supervisory Commission (KPP) that the company had been engaged in an unfair business practice in the purchase of two giant tankers of state oil and gas firm PT Pertamina, Kompas reported on Thursday.

The company's legal defense Hotman Paris said in Jakarta on Wednesday that the appeal would be soon submitted to the Central Jakarta court.

KPPU declared recently that Pertamina and its three business partners were guilty of colluding in the sale of two of Pertmina's giant oil tankers worth US$184 million last year.

The commission said the tanker sales had caused the state to suffer a financial loss of up to $50 million as the market price of each VLCC (very large crude carrier) was between $120 million and $150 million. Singapore-based financial advisor Goldman Sachs, PT Equinox, an Indonesian shipping company that serves as a Pertamina agent, and the tender winner, Frontline Ltd, a Swedish shipping company -- were ordered to pay a total of Rp 61.27 billion in fines to the state.

Pertamina and Goldman Sachs said earlier that they would appeal against the KPPU ruling.(*)