SKK Migas sanctions Huabei amid audit dispute

By Godang Sitompul

Upstream oil and gas authority SKK Migas has informed all oil and gas contractors operating in the country that all transactions made with PT. Huabei Petroleum Service will not be covered under the cost recovery mechanism.

This was said by SKK Migas in a January 12 letter to the contractors, signed by Chairman Amien Sunaryadi, a copy of which was obtained by Petromindo.com on Tuesday.

According to the letter, Huabei has been given sanction by SKK Migas because the company declined a complete audit by an independent auditor with terms of reference set by SKK Migas. The agency said that Huabei declined to provide digital data to the auditor due to the audit method of data acquisition from e-mail and computer server.

SKK Migas said that expenses resulting from procurement of goods/services contracts made by oil and gas contractors with Huabei after the date issue of the letter can no longer be included in operational costs which are reimbursed by the government through the cost recovery mechanism. ?This applies until PT Huabei Petroleum Service agrees to be audited, provide data required by the independent auditor, and the audit report has been accepted by SKK Migas,? Amien said in the letter.

Petromindo.com obtains information through the following web address https://hpsduri.wordpress.com/2015/7/23/profile-company/ that oil and contractors using Huabei?s services are Chevron Pacific Indonesia, PT Medco EP Indonesia, and Petrochina International Ltd.

Editing by Reiner Simanjuntak