RI to take diplomatic procedure to retain oil contract in Iraq

The Indonesian government will take a diplomatic procedure through the foreign ministry in order to retain the oil exploration contract awarded to state owned oil and gas company Pertamina during former dictator Saddam Hussein?s regime, Bisnis Indonesia reported on Tuesday.

"We will seek help from the foreign ministry to take a diplomatic procedure if the new Iraqi administration has unilaterally annulled the contract awarded to Pertamina," Director General of Oil and Gas Iin Arifin Takhyan said in Jakarta on Monday.

The U.S. government, which currently controls Iraq, has said that it would not recognize all the oil exploration contracts signed under the Saddam?s regime. Pertamina, during the administration of the former authoritarian leader, was awarded a contract to explore oil and gas in Iraq?s Western Desert. Pertamina initially planned to begin the exploration in January 2003 but it was delayed in March 2003 due to administrative problem.

According to the procedures, Pertamina was required to open an office in Iraq within 90 days. "But before the plan was carried out, a war broke in the country," Arifin said.

Meanwhile Pertamina?s president Baihaki Hakim said that there was no a clause in the contract saying that the new government after Saddam has the rights to unilaterally remove the contract. " I think it won?t be that easy. Pertamina has invested about US$3 million for the preparation of the exploration works," he was quoted as saying.

Separately, Minister of Energy and Mineral Resources Purnomo Yusgiantoro said that the new Iraqi government had no rights to revoke Pertamina?s contract. "The contract has a legal implication. We don?t see who leads the country and who becomes the minister (of oil)," he added. (*)