Indonesia's Pertamina promises to improve transparency after corruption allegations

Indonesia's state owned energy company Pertamina publicly apologized on Monday and promised to improve its governance following the arrest of five executives from one of its units for alleged corruption in relation to oil imports.

Last week, the Attorney General's Office arrested five executives from three Pertamina units on suspicion of corruption in relation to oil imports that occurred between 2018 and 2023. This allegedly caused state losses of $12 billion.

Pertamina CEO Simon Aloysius Mantiri said to reporters: "We will close the loopholes found by the AGO so as not to negatively affect the state or company budget."

He said the company would continue to import crude and refined products and work with energy minister to improve transparency.

Three executives from three Pertamina subsidiaries have been accused of colluding in order to justify greater crude oil and fuel volumes imported instead of being sourced domestically as required.

Pertamina Patra Niaga claims that two other executives approved the importation 90-octane fuel, called Pertalite at a price lower than the higher quality 92-octane gas, Pertamax.

Both face charges for approving the decision to mix 88-octane gas, called Premium, with Pertamax. The fuel was then sold at a higher-octane price. (Reporting and editing by Stephen Coates; Ananda Teresia, Bernadette Christina)

(source: Reuters)