Indonesia urges Australian compensation of 2009 Montara oil spill

Indonesia urges Australian compensation of 2009 Montara oil spill

2011-09-21 07:20:40 GMT+7 (ICT)

JAKARTA, INDONESIA (BNO NEWS) -- Indonesia has urged the Government of Australia to sign a compensation payment agreement related to the 2009 Montara oil spill, which has already been postponed on two occasions.

Indonesian Environment Minister Mohammad Gusti Hatta said the signing of the agreement had been delayed due to a change in Australia's energy and mineral ministry, but he now urged a prompt solution, asking that an agreement be signed soon, Antara news agency reported.

The agreement, which was scheduled to be signed on August 29, was postponed for September 6, but this date was also postponed, Mohammad explained, adding that a specific date for the agreement to be signed is now uncertain.

On August 21, 2009, an oil field off the northern coast of Western Australia and in Indonesia's Timor Sea experienced a blowout at a wellhead platform, causing a large oil and gas leak which is considered one of Australia's worst oil disasters. The rig, owned by the Norwegian-Bermudan Seadrill, and operated by PTTEP Australasia (PTTEPAA), continued to leak for 74 days until it was capped on November 3, 2009.

According to the Australian Department of Resources, Energy and Tourism, the Montara oil spill was leaking as much as 2000 barrels a day. Reports indicate a total of 40 million liters (over 10.5 million gallons) of crude oil were spilled into Australian waters, which reached Indonesia's seas through natural currents.

Over 70,000 square kilometers (43,500 square miles) of sea in Indonesia's East Nusa Tenggara province were eventually polluted. The Australian government later informed that an inquiry revealed that PTTEPAA's failure to carry out standard operating procedures caused the oil spill.

However, Mohammad said Australia had rejected the compensation payment agreement because the figures were too high, while Indonesian officials argued the numbers were based on the direct losses suffered by local fishermen, the general economic losses, as well as the indirect losses from the damage done to coral reefs, mangroves and coastal ecosystems.

PTTEPAA has said it would makeup Indonesia's losses through its corporate social responsibility (CSR) program and according to reports, through non-governmental organizations (NGOs). Mohammad underlined the big difference between CSR programs and recovering damages, describing PTTEPAA's proposal as unacceptable.

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