Former Pertamina president director Karen Agustiawan in court. (Antara Photo/Muhammad Adimaja)

Former Pertamina Director Sentenced to Eight Years in Prison for Failed Overseas Venture

BY : FANA SUPARMAN

JUNE 11, 2019

Jakarta. The Jakarta Corruption Court has sentenced Karen Agustiawan, the former president director of state energy company Pertamina, to eight years in prison after finding her guilty of causing financial losses for the government in a failed overseas investment scheme. 

The court said Karen had lost Rp 568 billion ($41 million) of state money by deciding to purchase 10-percent participating interest in the Basker Manta Gummy oil and gas block in Australia in 2009. 

Operator Roc Oil Company closed the block in 2010 due to a steep drop in production. 

The court said Karen had misused her authority because she had decided to make the investment without the necessary due diligence or risk analysis.

The signing of the sale and purchase agreement was also done without the approval of Pertamina's legal department or Board of Commissioners.

"The Board of Commissioners was disappointed because the sale purchase agreement was signed without its approval, a clear violation of Pertamina's articles of association," the judges wrote in the decision. 

Karen will also have to pay Rp 1 billion ($70,000) in fines or spend an additional four months in prison. 

The sentence was lighter than the public prosecutor's demand of 15 years in prison, a fine of Rp1 billion and a compensation of Rp 284 billion since the judges did not find any proof that Karen benefited personally from the purchase. 

One of the five presiding judges went further, giving a dissenting opinion that Karen was not guilty. 

Judge Anwar said the ultimate authority for such investment decision rest with Pertamina's directors, not the commissioners. Any resulting financial loss was normal from a business risk perspective. The Supreme Audit Agency has reviewed the purchase and did not find any financial loss to the state in the purchase. 

"Karen Agustiawan has not been proven guilty beyond doubt of committing the crime of corruption, [either] as a primary charge or a subsidiary one," Anwar said.

Karen said she would appeal the decision. "We belong to God. God is great. I will appeal," Karen told reporters after the hearing. 

Karen's attorney Soesilo Aribowo said he would file the appeal as soon as his client receives a copy of the court decision.  
 

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