Jakarta Globe, Olivia Rondonuwu & Wilawan Pongpitak | August 25, 2010
The Indonesian government is reportedly seeking $2.2 billion in damages caused by the 2009 Timor Sea oil spill, well up on its previous estimate of $55 million.
Jakarta. Indonesia plans to seek at least $2.2 billion in compensation from Thailand’s state-controlled PTT Exploration and Production Plc (PTTEP) for damage caused by a 2009 oil spill in the Timor Sea, a government source said on Wednesday.
But PTTEP chief executive Anon Sirisaengtaksin said the claim was not supported by evidence of economic damage from the oil that spilled for two months into Indonesian and Australian waters after a rig operated by PTTEP Australasia caught fire.
The size of compensation, if any, from one of the worst oil spills in Australian history is likely to be watched closely during the massive cleanup in the Gulf of Mexico from BP Plc’s blown-out offshore deepwater well.
“We have the final claim now and it will be above Rp 20 trillion ($2.2 billion), roughly,” said the Indonesian source, who declined to be identified because the negotiations are private.
“That is what we will put on the table. We understand that we will need to prove the claim based on scientific argumentation.” The impasse comes as PTTEP officials and Indonesian government representatives plan to meet in the Western Australia city of Perth to discuss compensation for the one of the worst oil spills in Australian history.
Indonesia’s claim is higher than analysts had expected. It initially asked for $55 million to pay in damages to local people and fisherman in the area.
PTTEP’s Anon said the Thai company had conducted its own studies and found there was not enough evidence of economic damage to justify paying compensation claims proposed by Indonesia.
“I believe there’s not enough,” he said. “We have gathered all evidence from the site ... There should be facts to support the claim.”
PTTEP Australasia’s West Atlas rig about 250 kilometers off the coast of Western Australia state spilled about 400 barrels of oil per day into an area known for diverse sea life.
The spill also drew calls in Australia for a suspension on new projects and tighter industry regulations.
The West Atlas drilling unit is located in PTTEP’s Montara development, where the start of production has been delayed to the middle of next year from late 2009. The rig is owned by Norway’s SeaDrill Ltd but operated by PTTEP Australasia.
PTTEP has said it is testing the development well for safety before demolishing the West Atlas rig and removing the existing wellhead platform. It plans to install a new platform and processing system.
Agence France-Presse
The aftermath of the West Atlas rig explosion, seen in this file photo, and the massive oil spill that came as a result is being assessed by ministers from Indonesia and Australia. (AP Photo/PTTEP Australasia)
