Indonesia Arrests Pertamina Oil-Shipping Executives in $12B Corruption Case
Indonesia’s Attorney General’s Office revealed the details of an ongoing corruption case that they allege cost the state $11.85 billion (193.7 trillion rupiahs) and ran for at least five years between 2018 and 2023. Seven executives were arrested Monday night, February 24, including the CEO of the oil company Pertamina, CEO of the shipping company Pertamina International Shipping, the director of one of the retail operating units of the company, and executives from other companies including a terminal operator.
The Deputy Attorney General for Special Crimes said the investigation had been launched in October 2024 and based on their finding they believe there had been a series of acts of corruption that harmed the state. They interviewed 96 witnesses, as well as experts, and extensively reviewed documents.
They detailed an elaborate plot that they said involved rejecting domestically supplied petroleum and reducing the capacity and readiness of domestic refinery capacity so that domestic petroleum production was not fully absorbed. Indonesian law requires that the company first source domestic supplies before importing petroleum for domestic needs. The charges contend the executives were rejecting domestic crude oil products saying they did not meet specifications, although they either did or could have been refined further.
The conspirators are alleged to have exported domestic oil labeled as not meeting standards. At the same time, they imported oil products for domestic use.
The charges further allege there was price manipulation and a criminal conspiracy to fix pricing. They imported oil to make up for the needs but reportedly brought it in at a lower quality than stated and blended it in the storage tanks.
The CEO of Pertamina International Shipping is alleged to be a conspirator in the corruption case. The AG’s office found that there was a markup on the shipping contracts. They allege the state paid a fee of 13 to 15 percent which was illegally generating profits from the transactions.
Among the individuals reported detained were Yoki Firnandi, CEO of Pertamina International Shipping, and Riva Siahaan, CEO of Pertamina, the state-owned oil and gas company. A total of seven executives were taken into custody with media reports indicating they are facing up to 20 years in prison if found guilty. Each could also be fined one billion rupiah, approximately $61,000.
The company issued a statement saying that it was ready to cooperate with the ongoing investigations. It called for the “presumption of innocence,” while saying it would respect the investigation.