Pertamina drops plan to report foreign oil contractor to Police
Saturday, November 24 2001 - 02:56 AM WIB
A source told Petromindo.com that the IPR people came to Pertamina headquarters on Friday. The source added that IPR had promised to deliver its oil output from the Camar field to the Cilacap refinery.
Indo Pacific Resources, which is listed in Canadian Venture Exchange (CDNX), is a wholly owned subsidiary of Canadian Fortune Oil and Gas Inc.
The company has been accused of not fulfilling its obligations to certain parties including Pertamina and had even tried to smuggle its oil output out of Indonesia.
The following is a brief background of the case according to an account of a source.
IPS entered Indonesia in March 1999 by acquiring the Camar and Tuban oil fields in the Bawean Production Sharing Contract Block off shore East Java from GBF resources.
The acquisition also means that IPS would be responsible for GBF's obligations including debts amounting up to $10 million owed to local vendors and the government in form of unpaid taxes.
IPS then appointed local company called PT Commissioning Services Indonesia (CSI) as contractor to develop the oil field.
On January 17, 2001, the contractor started to produce oil at 1,800 bpd for domestic market.
However, in May 2001, the production was halted due to several problems including leakages in production pipeline. But CSI has never been paid for its work. Total due is US$955 thousand.
In June 2001, IPS appointed a new contractor called PT Citra Joyo Karya Mandiri. But the obligations to the government, Pertamina and CSI had not been settled.
In November the company smuggled out some 51,761 barrel of oil from Bawean production. Production activity was then halted again.
Another source said that IPS had previously tried to smuggle oil to Canada.(arry)