Chevron Indonesia's Bioremediation Contractor Gets Five Years in Jail

A Chevron gas station sign is seen in Del Mar, California, April 25, 2013. Chevron will report earnings on April 26. (Reuters Photo/Mike Blake)

By : ID/Aris Cahyadi & SP/Novianti Setuningsih | on 12:27 PM May 08, 2013
Category : News, Crime, Featured

A Chevron gas station sign is seen in Del Mar, California, April 25, 2013. Chevron will report earnings on April 26. (Reuters Photo/Mike Blake) A Chevron gas station sign is seen in Del Mar, California, April 25, 2013. (Reuters Photo/Mike Blake)

A director for a company that carried out a bioremediation project for Chevron Pacific Indonesia (CPI) has been found guilty and sentenced to five years in jail for causing more than $3 million in state losses.

Ricksy Prematury, the director of Green Planet Indonesia (GPI), one of the companies hired by Chevron Indonesia to carry out bioremediation projects on its behalf, was also ordered by the Jakarta Anti-Corruption Court to pay a Rp 200 million ($20,000) fine or spend another two months in jail.

The court also ordered GPI to pay back the $3.089 million in state losses within a month or have the state confiscate the company's assets.

The sanction is lighter than prosecutor's request for the court to sentence Ricksy to 12 years in prison and fine him Rp 1 billion or spend another six months in jail.

The verdict stated that GPI botched the bioremediation project it carried out for Chevron in Duri, Riau, incorrectly testing the oil-polluted soil's characteristics and using the wrong bacteria to neutralize the pollutants. Bioremediation is a process that uses biological organisms to remove or neutralize pollutants.

The verdict further stated the GPI was not competent to handle the project as it did not have qualifications as a waste management company.

These two findings mean the company violated a Ministry of Environment regulation issued in 2003 on the Method and Technical Requirements on Waste and Contaminated Soil Management.

As GPI had no permit from a relevant institution to manage the contaminated soil, it was also found to be in violation of a government regulation issued in 1999 on Hazardous and Poisonous Waste Management and another government regulation issued in 2009 on Environment Protection and Management.

The court cited in its verdict the explanation of the bioremediation expert presented by the prosecutors, Edison Effendi, who testified that GPI ignored some processes in neutralizing the polluted soil.

However, Chevron Indonesia contested the use of Edison as an expert, as he lost the 2007 and 2011 tenders to handle bioremediation projects for the company, as well as of two others “experts” from the same consulting firm as Edison who presented the exact same testimonies.

The state loss was incurred as Chevron reportedly received a cost recovery budget from the now-defunct upstream oil and gas regulator BPMigas. Earlier during the trial, prosecutors said the cost recovery budget used to pay what they called a “fictitious” bioremediation project reached US$23.36 million.

[quote author="Sofialdi, Anti-Corruption Court judge who issued dissenting opinion"]The result is invalid and unscientific, moreover if used as basis for a verdict[/quote]

One of the three judges in the panel, Sofialdi, issued a dissenting opinion.

Sofialdi said he believed the bioremediation project had been completed by GPI, and that GPI did not necessarily need a permit from the government to handle the project as it was Chevron Indonesia who should have obtained the permit.

The judge also raised questions over the testing done by Edison, the expert witness, which he said was done in an unverified laboratory seemingly established just for that purpose.

“The result is invalid and unscientific, moreover if used as basis for a verdict,” Sofialdi said, adding that Ricksy should be freed from all charges.

Herlan bin Ompo, president director of PT Sumigita Jaya, another company that carried out a bioremediation project for CPI, also told that the sample tested was taken on April 9, 2012, but tested only on June 13, 2012, way beyond the recommended 14-day limit. He is also a suspect in the same case.

Prosecutor Fitri Zulhami said they would appeal the verdict, while Ricksy said he was still considering it.

Najib Isman, Ricksy's lawyer, said the legal proceeding was misleading and supported the dissenting opinion from Sofialdi.

“In the tender process, there was no permit issue,” Ricksy said. “The Environment Ministry said the permit should be obtained by the owner of the land and the waste, which in this case is Chevron. We're only the operator.”

Najib said Chevron did have the permit for the bioremediation project, but it expired in the middle of the process. It applied to have the permit renewed and the Environment Ministry approved it.

Ricksy also said that in GPI's contract with Chevron Indonesia, it was not mentioned that the cost recovery budget would be used to pay GPI.

The Attorney General's Office has been pursuing this case since 2011 and named seven suspects in 2012, including five Chevron employees.

In December 2012, the South Jakarta District Court ruled that the AGO had not obtained enough preliminary evidence against four Chevron officials accused in the case, and ordered the AGO to drop the case and release the suspects from all charges.

But AGO spokesman Setia Untung Arimuladi said in January that his office could not comply with the ruling, arguing that a copy of the verdict had not been sent to the AGO. Setia said the AGO had decided to press on with the case and had even completed prosecution documents against Bachtiar Abdul Fatah, Chevron Indonesia’s Sumatra Light South operations manager.

The National Commission on Human Rights (Komnas HAM) over the weekend said there were indications of legal discrimination in the case, according to It said the expert witness, Edison, participated in a failed bioremediation project for Chevron in 2004, and failed in two subsequent bids to become a subcontractor again for the company.

Chevron Indonesia has warned the nation’s upstream oil and gas regulatory body, SKMigas, that a deteriorating investment climate in Indonesia may lead to lower future investment by the company.

It sent eight letters, one for each of the oil and gas blocks the company operates, to SKMigas on Nov. 30 last year stating that the company reserves the right to reduce its investment in Indonesia, a move that would lead to lower production, if there were substantial negative changes to the country’s investment climate.

Among those negative factors cited was “the continued criminalization of oil and gas activities.”


Show More