Palembang. Former South Sumatra Governor Alex Noerdin was recommended a sentence of 20 years’ imprisonment for corruption allegations during a hearing in the provincial capital Palembang on Wednesday, eight months after he was arrested by prosecutors.
Alex, 72, is accused of misusing authority and fraud in a gas purchase deal that according to prosecutors has cost the state more than $30 million when serving as governor.
He is also accused of misappropriating donations intended for a project to build Sriwijaya Great Mosque in the city.
In addition to the prison term, prosecutors also sought financial restitution worth the equivalent of $3.5 million from the defendant.
“The restitution must be paid in full within a month after his conviction is declared final, or his assets will be seized. If the value of the assets isn’t adequate, the jail term must be extended by another 10 years,” the Palembang District Court heard.
The hearing is adjourned for next week to hear the defense statement.
According to the Attorney General’s Office, the case stemmed from a gas supply and purchase deal involving a South Sumatra municipal company when Alex was leading the province for 10 years from 2008.
The province won the right to buy 15 million metric cubic feet (MMCF) of gas per day from the Jambi Merang field in Sumatra, which was jointly managed by state-run energy company Pertamina, Talisman Ltd, Pacific Oil and Gas Ltd.
The now-defunct Oil and Gas Regulatory Body (BP Migas), a state regulator in the industry, appointed municipal company Perusahaan Daerah Pertambangan Dan Energi (PDPDE) to manage the purchase for South Sumatra at that time.
Arguing that the municipal company had little experience in the business in addition to a lack of funding, the provincial government set up a joint venture with private company Dika Karya Lintas Nusa.
However, it turned out that PDPDE has only a 15 percent share of ownership in the joint venture, the AGO said.
The ownership structure has allowed the private company to reap a disproportionate share of profit while causing a massive financial loss on the government’s side.
The AGO said the joint venture has inflicted a loss of at least $30 million in revenues that should have been paid to the provincial government between 2010 and 2019 based on an estimate by the Supreme Audit Body (BPK).
A month after Alex’s arrest, his 50-year-old son Dodi Reza Alex Noerdin was detained by the Corruption Eradication Commission (KPK) for allegedly accepting Rp 2.6 billion ($184,400) in bribe money from a businessman who seeks to win local government projects.
Dodi is the elected head of Musi Banyuasin district in South Sumatra.