Local contractors attack Total over bank guarantee issue

Local suppliers in Balikpapan, East Kalimantan, have protested the rejection by oil and gas firm PT Total Indonesia of the so-called surety bond as an alternative to bank guarantee, the local Kaltim Post daily reported Tuesday.

The paper said that other oil and gas companies operating in the province had accepted the surety bond. The paper said that the use of the surety bond as an alternative to bank guarantee was backed up by a presidential decree and a ruling of the state-owned oil and gas company Pertamina.

"Based on our observation, so far only Total which rejects the use of surety bond," said deputy chairman of the local office of the Indonesian Chamber of Commerce and Industry (Kadin) Johny Ng.

Johny said that Kadin had sent a protest letter to Total, but the company had not yet responded.

Meanwhile, Total spokesman Nurul Fazrie said that he had not yet read the Kadin letter, but he said that Total would arrange a gathering in February with local suppliers and contractors to discuss various issue.(*)