Indonesia Energi wants partners to share mud flow costs
Source: Reuters
JAKARTA, Feb 1 (Reuters) - Indonesian firm PT Energi Mega Persada Tbk <ENRG.JK> wants its partners to share the costs of the damage caused by a mud disaster near a drilling site in East Java, a leading daily reported on Thursday. Energi indirectly controls PT Lapindo Brantas, which holds a 50 percent stake in the Brantas block from where a torrent of hot mud has continued to gush since May, inundating entire villages and leaving around 10,000 people homeless. PT Medco Energi International Tbk <MEDC.JK> holds a 32 percent stake and Australia-based Santos Ltd <STO.AX> the remaining 18 percent. Suyitno Patmosukismo, the chief commissioner of Energi Mega Persada, told the Jakarta Post the liability should be shared according to the percentage stakes held by each partner in the Brantas gas field. "Both Medco and Santos always received day-to-day reports on progress in the field. Even though they are not the operators, both firms had at least one of their officers on the ground," Patmosukismo was quoted as saying. Energi officials were not available for comment. Medco E&P Brantas, part of Medco Energi and a partner in the Brantas block, has filed a complaint against Lapindo in international arbitration over the exploration incident. Medco wants to relieve itself of any financial cost related to the incident. Indonesian President Susilo Bambang Yudhoyono said in December that Lapindo Brantas, the well operator blamed for the mud disaster, would have to pay $420 million to victims and for efforts to stop the mud flow. Santos said last month it had received no confirmation from Lapindo Brantas on the compensation payout for the mud flow problems. Energi is owned by the Bakrie Group, which is controlled by the family of Indonesia's chief social welfare minister, Aburizal Bakrie. The government -- including Minister Bakrie -- has said Lapindo should be held responsible for the disaster. More than 10,000 people have been displaced and entire villages inundated by the mud that has flowed since the drilling accident in May in Sidoarjo, an industrial suburb of Surabaya, Indonesia's second largest city. Anger has been mounting in the area over the hot mud, which has continued to gush despite several government contingency plans to plug the leak, also blamed for a gas pipeline explosion in the area that killed 13 people.
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