Ibnu Sutowo dies at 86

The founding father of state oil and gas company Pertamina, Ibnu Sutowo, died at the age of 86 today.

Spokesman for Pertamina's production sharing contractor (PSC) directorate A Sidick Nitikusuma said Ibnu, a retired army lieutenant general, died at Pertamina's hospital in Jakarta at 5.40 a.m. due to old age.

"He will be buried today after the Friday (Islamic) prayer at the Kalibata hero cemetery," Sidick, who was also known to have a close relationship with Ibnu, said.

Born in September 1914 in Yogyakarta, Ibnu graduated from the medical school in 1940 and later took up a military career. He was appointed South Sumatra's Sriwijaya military commander in 1955.

Ibnu was appointed to head newly-established Permina in 1957, which was renamed into Pertamina in late 1960s. He headed Pertamina until 1976.

He built Pertamina from scratch and turned it into a respectable oil and gas company.

He is the originator of the production sharing contract system (PSC), which has been copied by many developing countries.

During his leadership of Pertamina, the country reached a record oil production of more than 1.5 million barrels per day. But, to the younger generation, Ibnu is chiefly remembered as a corrupt figure, who almost brought Pertamina into bankruptcy in the mid-1970s with a debt of US$10.5 billion following a tanker deal with Swiss-based businessman by the name of Bruce Rappaport.

He was fired by then President Soeharto in 1976 because, he said, he turned down a crude oil business proposal from the President.

"I was fired by Seoharto in 1976 when I was at the peak of my success, that was when I just managed to send the first shipment of liquefied natural gas (LNG) from PT Arun NGL Co to Japan," he once told a local paper.

He never admitted to corruption and no court trial has been staged to examine his case.

Australian journalist Hamish McDonald in his book titled "Soeharto's Indonesia" writes about him as follows:

"To the foreigners, he was a "Black Diamond". He was a man whose word was his bond, who could get through Jakarta's bureaucratic maze, get their money in and their profits out. But to his critics, he was the epitome of all that was wrong in Soeharto's Indonesia. Ibnu was beyond reach of constitutional authority, answerable only to Soeharto and, even then, through private channels.

"He ran a massive, expanding section of the economy with little reference to agreed goals and priorities. He set an example of personal extravagance and financial irregularity which was repeated in small fiefdoms down a massive pyramid of corruption. He was a sultan in color and tie presiding over a new bureaucratic feudalism," McDonald says. (Hans Bodega)