Pertamina appeals Lirik case ruling
Monday, September 7 2009 - 07:55 AM WIB
The Central Jakarta District Court refused to dismiss the arbitration ruling, citing that the ruling was made by an international arbitration court.
Pertamina has appealed to the Supreme Court, insisting that the arbitration ruling should be considered as one by a domestic arbitration court -- thus could be dismissed by the local court -- because the hearings were held in Indonesia despite that the panel included a foreigner and the hearings were carried out in compliance with an international arbitration code.
?The appeal was filed on Friday, Sept. 4, 2009, in an effort to protect the state assets from being appropriated,? Pertamina?s PR Manager Mochammad Harun said in a statement on Monday.
The Central Jakarta District Court made the ruling on the previous day.
The dispute between Lirik and Pertamina surfaced after both firms formed a joint operating body (JOB) in 1995 to develop the Lirik block. The block belonged to Pertamina. Pertamina often invites other parties to jointly develop its blocks under the JOB or TAC (Technical Assistance Contract) arrangements
Lirik later proposed to develop four fields in the block, that is Lirik, North Pulai, South Pulai and Molek but Pertamina, which then also acted as industry regulator (the job now carried by BPMIGAS) only gave it a go-ahead to develop the Lirik field. This led Lirik Petroleum to file an arbitration suit against Pertamina, citing that the latter's move had caused potential losses.
The suit filed by the firm with the International Chamber of Commerce (ICC) International Court of Arbitration in 2008, that is more than ten years after the case happened. And the arbitration panel issued the verdict on Feb. 27, 2009, calling on Pertamina to pay $34.4 million in damages. (godang)