Lapindo Brantas Losses

Oct 18th, 2006, in Business & Economy, by

The company at the heart of the Sidoarjo mudflow disaster in East Java, Lapindo Brantas Inc., faces losses of over $100 million.

Lapindo Brantas Inc., formerly a subsidiary of PT Energi Mega Persada Tbk., whose owner is government minister Aburizal Bakrie, is expected to have lost US$104 million, or about 964 billion rupiah, by the end of 2006, due to expenses and lost production caused by the hot mud flow at its gas field in the Brantas Block near Surabaya. However due to the fact that Lapindo was recently sold, for the princely sum of $2.00, to Lyte Ltd, of Jersey, UK, a company which may exist on paper only (New York Times), the company may in fact avoid facing much of its obligations by filing for bankruptcy. According to Tempo Lyte was founded on 17th January 2006 with starting capital of ten thousand pounds sterling.

An independent examiner, Elliot Association Pte. Ltd. has estimated that the itemised losses will be as follows: $25 million for attempts to stem the mudflow at its source, the well, $10 million for evacuations of refugees, $19 million for damages to buildings and homes, $15 million for the handling and management of the mud flow, and $25 million for the disposal of the mud.

The Director of Energi Mega, Faiz Shahab, in a written submission to the Jakarta stock exchange, said:

The losses will keep increasing.
(Kerugian itu terus bertambah.)

Meanwhile another spokesman for Energi Mega, Herwin Hidayat, said that as of July 2006 the company had expended $4.9 million on the problem and that in September alone $30 million had been spent, money which had been divided between Medco dan Santos, two companies which participated in the development of the Brantas Block gas field.

On the fire sale of Lapindo to Lyte, whose name will shortly be changed to Bakrie Oil and Gas Limited, the National Investment Board, Badan Pengawas Pasar Modal (Bapepam), is reputed to be carrying out investigations. Previously the Board had stated that Energi Mega was obliged to seek a 125 million dollar loan from Merrill Lynch.


3 Comments on “Lapindo Brantas Losses”

  1. avatar Fanglong says:

    Kerugian itu terus bertambah : this is the secret of all. “Communicating vessels”.

  2. avatar bbruce28 says:

    I once read that the Mayans turned the coastline of Mexico into land by building wooden platforms and covering them with dirt.
    As plants, grasses (and then trees) took hold, the roots reached into the water, eventually containing sand and pebbles. The platforms eventually became permanent land forms.

    If this is true, could the same not be tried in Sidoarjo? Could floating platforms not act as a seal (like a bandage on a bleeding wound)? They would rise with the mud (not susceptible to collapse). As the platforms rise, the temperatures cool, eventually allowing small plants to survive. Then larger plants and trees.

    Couldn’t the roots of these larger plants also help contain the mud?

    Saya pernah membaca waktu orang Maya sampai Mexico lampung tanah dibuat sama batang-batang kayu. Setalah lampung-lampungnya ditutupin sama tanah, lampung-lampungnya bisa dipakai seperti taman sayur-sayuran.
    Kemudian, tanaman-tanaman lebih besar terpancangan, pasir dan batu ditanggkap di bawa lampung, terus tanaman lebih besar bertanam.

    Akhirnya, lampung-lampung itu jadi pulau tetap.

    Kalau informasiku betul, acara ini bisa dipakai di Sidoarjo?

    Kalau tidak, kalau ahli bedah ingin memperhentikan pendarahan, dia pakai apa?

  3. avatar iamisaid says:

    ,

    If this is true, could the same not be tried in Sidoarjo? Could floating platforms not act as a seal (like a bandage on a bleeding wound)? They would rise with the mud (not susceptible to collapse). As the platforms rise, the temperatures cool, eventually allowing small plants to survive. Then larger plants and trees.

    Couldn’t the roots of these larger plants also help contain the mud?

    Who knowsm maybe it could work if there is a political will to do it.

    Just my two cents here –

    1. That’s going to be a lot lot lot of timber to be used for the purpose. Still possible.

    2. Does type of soil that the Sidoarjo mud is made of support vegetation growth? I am not sure. Perhaps someone at IM who is closer to the Sidoarjo issue could elaborate on this.

    3. I am not a soil specialist. If the mud ooze has come to a definite end and the vegetation can grow on it, I think it would take a few decades before the subterranean soil would be safe grounds for restorative work and buildings.

Comment on “Lapindo Brantas Losses”.

RSS
RSS feed
Email

Copyright Indonesia Matters 2006-18
Privacy Policy | Terms of Use | Contact