Medco to take Lapindo to international arbitration

PT Medco Energi International, a publicly listed oil and gas company, will take Lapindo Brantas Inc to New York-based arbitration to settle their difference over the costs that have to bear in dealing with mud blowout at the latter's exploration well in Sidoarjo, East Java, Bisnis Indonesia reported on Monday.

Medco said that it had sent a letter on Oct. 16 to inform Lapindo on its decision to go to the international arbitration to settle their dispute over the cost of the mudflow they have to share in dealing with the massive mudflow.

Medco's president director Helmi Panigoro confirmed that the company would go to New York?based arbitration. But he refused to elaborate.

Vice president capital market of PT Energi Mega Persada's (EMP) said that he knew nothing about the letter sent to the international arbitration regarding Lapindo case.

EMP through its subsidiaries Kalila Energy Limited and Pan Asia Enterprise Limited which has together owned 99.99 percent of Lapindo's stake.

Lapindo has participating interest of 50 percent in the Brantas block, which exploration well Banjar Panji-1 flowed hot mud that has inundated several villages with Medco and Santos Ltd of Australia holding 32 percent and 18 percent, respectively. (*)