INDONESIA: Tempo-Apr 27
An out-of-court settlement may be the best way to resolve the Montara oil spill in the Timor Sea. But the government should not move on its own while East Nusa Tenggara seaweed farmers’ class action is still underway at the Sydney Federal Court, Australia.
The government needs a breakthrough in the dispute implicating Petroleum Authority of Thailand Exploration and Production (PTTEP) Australasia, a subsidiary of PTT Public Company Limited, a Thai state-owned oil company. The case has been pending for almost nine years. As of now, there has been no resolution offered to the government as well as East Nusa Tenggara’s fishermen and seaweed farmers directly impacted by the August 2009 oil spill.
Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan’s proposal for a middle-path solution deserves consideration. And for a valid reason, namely the relationship of the two ASEAN member countries. Additionally, PTTEP-the world’s 10th largest oil company will also be making an investment in Indonesia worth US$2 billion, or around Rp27.4 trillion.
There is indeed nothing wrong with fighting through court, but that path will for sure be long and complicated.
The fishermen demand PTTEP Australasia to pay US$200 million, or about Rp2.7 trillion, in compensation. But the case has only reached an interim verdict in regard to Daniel Sada’s legitimacy in representing 13,000 fishermen and seaweed farmers in East Nusa Tenggara, not the core issue itself.
The government, through the environment and forestry ministry, also sued three parties seen as responsible for the oil spill in 2017. Besides PTTEP Australasia, two other companies sued by the government at the Central Jakarta District Court were the Petroleum Authority of Thailand Exploration and Production Public Company Limited as well as the Petroleum Authority of Thailand Public Company Limited. The government demanded Rp27.47 trillion in compensation. But the lawsuit was canceled in February.
A court battle will be exhausting. Both the oil company with Rp438 trillion in the market capital as well as the seaweed farmers believe they have strong arguments. Citing an independent agency’s study, the company argues that 98 percent of the oil went into Australian waters and will never reach Indonesian waters. The island closest to the oil spill is Rote, around 82 kilometers away.
Meanwhile, seaweed farmers are relying on the results of an Australian Senate hearing initiated by Senator Rachel Siewert in 2010, where the Australian Maritime Safety Authority admitted to having sprayed highly toxic chemical powders, Corexit 9572 and 9572-A dispersants, over the surface of the Timor Sea to overcome the Montara oil spill. The spray instantly killed big and small fishes. In 2012, the Darwin Court also imposed a fine of US$510,000, or almost Rp7 billion, citing the company’s failure to exercise caution.
Considering these facts, the government should invite the seaweed farmers to opt for the same middle path. This path will be simpler for both parties because negotiations will be concentrated only between Indonesia and PTTEP, without involving a third party. What’s important are transparent negotiations to ensure that the government’s and the East Nusa Tenggara seaweed farmers’ demands are fulfilled. The results of these negotiations must also be reinforced in court, to give force to agreements and to ensure that they are executed by both sides.
(First published in Tempo – https://en.tempo.co/read/news/2018/04/27/314917963/End-Game-in-Montara)
