Exclusive: Indonesia oil regulator suspends energy tenders amid graft scandal

JAKARTA (Reuters) - Indonesia's energy regulator has suspended all oil, condensate and natural gas sell tenders as it reviews internal procedures after its chairman was caught taking an alleged bribe from an oil trader last week, an agency official said on Monday. The suspension is the first evidence that the graft scandal engulfing SKKMigas is starting to impact day to day operations for Indonesia's huge oil and gas industry.SKKMigas suspended a tender to sell around 400,000 barrels of condensate from Total's (TOTF.PA) Senipah complex that was due to close on Monday, said an agency official who wished not to be named."The tender process is on hold. We aren't continuing the tender process," he told Reuters, adding that he was not sure how long the halt would last.On Wednesday, SKKMigas chairman Rudi Rubiandini was arrested for taking an alleged bribe from an executive with Singapore energy trader Kernel Oil Pte Ltd, heightening the uncertainty over energy policy in Southeast Asia's largest economy, where oil and gas production contributes a fifth of government revenue.Kernel Oil was a participant in Monday's suspended tender, worth at least $41.5 million based on July prices. The small company, which has denied involvement in the graft case, is among 40 companies authorized to buy oil and gas from SKKMigas."We need to start over because Kernel was already listed as a participant (in the tender)," the official said."The impact (from the suspension), of course, is that the income to our nation will be a little bit delayed. But in terms of impact over one year, I don't think the impact will be that (significant)."SKKMigas, which sells excess oil and gas that cannot be used by state energy company PT Pertamina Persero, has conducted at least seven tenders this year, selling Minas and Duri crudes and Senipah and Geragai condensate.After Rubiandini's arrest, the scandal widened on Friday to include three other top SKKMigas officials. The heads of the regulators' crude and natural gas commercial divisions, as well as the chief of operations support, were all suspended and barred from travel.Officials from the Corruption Eradication Agency (KPK) over the weekend confiscated documents from the office of SKKMigas' interim chairman Johanes Widjornarko, who replaced Rubiandini.A KPK spokesman said the action was part of the investigation but that Widjornarko was not a suspect.The KPK spokesman said the agency had also seized $200,000 from the office of a top energy ministry official, which it believed was linked to the Rubiandini case.The energy regulator, which has named temporary replacements for the impugned officials, had earlier said the scandal would not affect oil operations.SKKMigas has existing production sharing contracts with oil majors including BP Plc (BP.L), Chevron (CVX.N) and Exxon Mobil (XOM.N).(Additional reporting by Florence Tan in SINGAPORE; Editing by Tom Hogue)

This article is taken from Reuters.com