Pertamina's Baihaki denies massive graft allegations at the company

The president of state oil firm Pertamina, Baihaki Hakim, denied on Friday an audit report from the Development and Finance Comptroller (BPKP that revealed a total of 212 cases of graft allegations in the state oil giant amounting to Rp 1.054 trillion in losses.

Baihaki said that graft allegations from BPKP were still allegations and needed verifications, and therefore it was not right to say that all the 212 cases contained corruption, collusion and nepotism practices, locally known as KKN.

"Therefore, it is not correct if all cases are associated with KKN because not all of them has been clarified by BPKP to us," Baihaki said after receiving an ISO certificate from KEMA for Pertamina's Balongan refinery.

BPKP's audit encompassed Pertamina, its subsidiaries and its production sharing partners, covering the 1999/2000 fiscal year ending March 31.

According to Pertamina's spokesman Ramli Djaafar, BPKP found possible irregularities in Pertamina activities amounting to Rp 208 billion, of which some Rp 20 billion had been clarified.

Findings of possible irregularities in Pertamina's production sharing partners totaled Rp 820 billion, he said, with cases involving Rp 515 billion clarified.

Ramli said that irregularities in Pertamina's subsidiaries totaled Rp 3 billion, of which cases worth Rp 1.5 million had been clarified.

Baihaki said: "From those irregularities, what had actually happened was mostly dealing with the violation of common procedures stipulated in the regulations on the procurement of goods and services. So, yes, there are irregularities, but all of them should not be translated as KKN," Baihaki said.

Baihaki said that BPKP was too hasty in announcing its audit results while it was still making clarifications with Pertamina. But he said that it would not bother Pertamina, and he vowed that Pertamina would continue to reduce the level of KKN in its operations.

Meanwhile, legislator Pramono Anung said on Friday that he suspected that there was something wrong in the revelation of KKN cases in Pertamina by BPKP.

He suspected that Pertamina had thus far supported BPKP financially, but maybe, Pertamina reduced or even altered the support altogether that forced BPKP to uncover KKN in the state oil firm.

Pramono said it looked strange for BPKP to suddenly attack Pertamina while the oil firm, according to him, had increasingly become more transparent.

"I smell something wrong with the revelation of the audit report by BPKP. I'm afraid it is actually dealing with tactical funds that thus far has been received by this institution that audits state firms (BPKP)," he said. (*)