Pertamina officials arrested for allegedly involved in crude oil theft

At least seven senior officials of state owned oil and gas company Pertamina have been arrested for their alleged involvement in the stealing of crude oil from an offshore oil receiving terminal in Lawe Lawe, some 30 kilometers from Balikpapan, East Kalimantan, Kompas reported on Saturday.

The head of the East Kalimantan police Budi Utomo told reporters on Friday that the seven officials of Pertamina were believed to be part of the 24 men who were suspected to have been involved in the stealing of crude oil from the Lawe Lawe oil receiving terminal.

The suspects were believed to have pumped out at least 12,600 tons of crude oil since October, last year from the oil receiving terminal. The crude oil was smuggled to Singapore using foreign flag-oil tankers.

Budi said that the crude oil theft was firstly detected when Indonesian marines on board of the navy ship KRI Multatuli seized Korean ship MT Tioman in the Indonesian water near Riau. The police later found out the ship which carried about 19,000 barrels, or about 2,881 tons of crude oil came from Pertamina's oil receiving terminals in Lawe Lawe.

Based on initial findings, according to Budi, the stolen crude oil was sold to a Singapore-based buyer at a price of about US$35 per barrel, almost a half of the market price.

Pertamina operates a number of floating facilities in the crude oil receiving terminal complex in Lawe Lawe, each with a capacity of 135,000 DWT. The receiving facilities are linked to the main terminal complex through six-kilometer undersea pipeline for processing. The facilities then transmit the processed crude oil to Pertamina's refinery plant in Balikpapan through a 30-kilometer undersea pipeline.

The police believed that the suspects replaced the stolen crude oil with sea water so that the officials in the main terminal complex would not suspect their stealing activities.(*)