Chrevron's activities in Riau province, Indonesia

Chevron’s production in Riau province, has been plagued by economic and environmental injustice but Chevron has repressed the protests. In May 2013, the anti-corruption court convicted two directors of two Chevron’s Indonesian contractors for corruption.


Description
Chevron's partnership with the people and the Government of Indonesia can be traced back to 1924, when the Standard Oil Company of California (Socal), now Chevron, dispatched a geological expedition to the island of Sumatra. [8] Its oil production began in 1952 and it remained active in Indonesia throughout the infamously brutal and repressive decades of the Suharto dictatorship (1965-1998). The majority of Chevron’s oil production has, and continues to take place in the Riau province in the center of the Sumatra Island, where it operates four onshore blocks, the largest of which, the Duri field, is one of the world’s giant oilfields and the one of the largest steamflood operations. [6] Through its subsidiaries, PT Chevron Pacific Indonesia and Chevron Indonesia Company, it conducts oil and gas operations. Chevron also manages geothermal projects through Chevron Geothermal Indonesia, Ltd., and Chevron Geothermal Salak, Ltd., in Indonesia. It also sells lubricants in Indonesia through its subsidiary PT Chevron Oil Products Indonesia. [8] Chevron’s Riau production has been plagued by economic injustice, environmental destruction, and the dislocation and disenfranchisement of Indigenous populations. As a result, citizen resistance to Chevron has been a constant of life in Riau, often taking the form of massive protests against the company, with protestors at times numbering in the tens of thousands. Chevron has employed brutal measures to quiet protests, including utilizing Indonesia’s notorious security services, bringing charges of human rights abuse, violence and intimidation. For example, WALHI - Friends of the Earth Indonesia denounced many such facts in a 2011 report. They describe for example collusions between the company and special forces in Indonesia: on 27 January 2000 Chevron paid the BRIMOB to overcome a series of actions and protests over land disputes and employment [6]. The BRIMOB are well-known for extreme human rights violations, including kidnapping, rape, torture, indiscriminate violence and murder. As a result of the brutality of BRIMOB, 15 people involved in the protests against Chevron were wounded and five were hospitalized.  The report goes on with a protest action happened September 14th, 2009, when Mr. Darmaidi, a local sand miner, climbed atop a Chevron high-voltage electricity tower in Pematang Pudu and he sought to commit suicide from atop Chevron’s tower. Only the supportive words of neighbors brought him down safely. The reason was he was unable to work on his land because, he contended, it had been contaminated by Chevron’s oil. Two months earlier, Darmiadi sent a letter to Chevron asking the company to take responsibility. The company denied responsibility and his request, and further argued that because Chevron owned part of his land, Darmaidi should not be sand mining on the land anyway. WAHLI publication also reports about accidents at Chevron plants. On October 28 2010, CPI’s oil pipeline exploded in Manggala Jonson Village, Tanah Putih Sub District, District Rokan Hilir, Riau Province. Two girls, suffered burn wounds with hot crude oil from the exploded pipe that was spurting oil 10 meters high. Because of the incident, local community members from Manggala Jonson Village suffered from asphyxiation and sore throats. According to one source, who requested to remain anonymous, it is believed that the oil spill contained hazardous waste, which was inhaled by the community. However, the community was somewhat reluctant to speak openly to the media about their health impacts. Chevron and its heavy equipment team came two hours after the explosion to repair the pipe.  Also in 2010, local communities in the Rumbai Coastal area complained that their houses were continually flooded due to the overflow of a Chevron waste ditch. The coordinator of the Rumbai Community and Rumbai Coastal area reported this to the police on February 27, 2010. The community has suffered from serious skin problems, but Chevron has not paid any attention. The Head of the Local Parliament Commission, Aswendi, said that Chevron had promised to clean the ditch. Mr. Hanafi Kadir, Communications Manager of Chevron Pacific Indonesia said, “this (the flood) is not merely caused by shallowed drainage, but also because of the development impact. There is no more water catchment area. We admit that probably the drainage got shallowed but we have done dredging.” On 25 October 2010, seventy-five community members joined the Rantau Bais Terpadu peasant group for a demonstration at the gate to Batang Field, owned by Chevron Pacific Indonesia. For two days, the demonstrators cut off the gate to the oil field on land the company had seized for exploration and exploitation. They hung a banner urging Chevron Pacific Indonesia to leave immediately and they set up a tent in the middle of the road, stopping all vehicles that attempted to go into the location. The demonstration was conducted peacefully, although hundreds of police were equipped with rifles and hand guns. “Chevron has seized 130 hectares of our land since 2003, even though there are 65 claimants’ letters for the land,” said Masran Djasid, coordinator of community. “There are still 130 out of 600 hectares for which the company has not yet provided compensation. But Chevron has built dozens of oil pumps. Since 2005 Chevron has not displayed any goodwill. In fact, the community conducted a demonstration in February 2010, and sent a complaint to the Head of the District, the Governor, and even the National Parliament. But there has been no solution and the company has been violating its own map.” Currently, the state-owned Executive Agency for Upstream Oil and Gas (BPMIGAS) is investigating the land conflict between the villagers of Rantau Bais and Chevron. “The legal department of BPMIGAS is studying the conflict. And, in fact, we suspect that there is some land that has not been paid for yet,” said Elan Biantoro, Head of Public Relations for BPMIGAS. According to the company, Chevron has paid 8.6 billion rupiah (approximately US$ 1 million) for compensation for an area of 457.19 hectares, which consisted of 296 claimants. The company rejected 65 claimants because they were not included the 457.19 hectares. Since Chevron has not responded to the community’s concerns, the community organized another blockade on November 25, 2010. Arifin Ahmad, Secretary of the Peasant Group Rantau Bais Terpadu, said, “We are forced to blockaden the road again because so far Chevron has not been willing to pay compensation for our land.” “If there is no change in Chevron’s position, we will stay here.” [6]  On October 2011 the attorney general's investigation started an investigation against Chevron for corruption [3]. In fact Chevron Pacific Indonesia appointed two Indonesian contractors, Green Planet and Sumigita, to do the bioremediation work, which entails removing or neutralizing contaminants in soil or water. Prosecutors said the companies were not qualified and did not have the proper permits, and that the cleanup was unnecessary because the area was not sufficiently contaminated. [4] Prosecutors claimed Chevron staff had violated Indonesia’s anticorruption laws because the company would have qualified for reimbursements of nearly $10 million from the government under a cost-recovery program and therefore would have created losses for state coffers. Ironically, in 2011 Chevron received an award from the Ministry of Environment for the high quality of its bioremediation project in Sumatra. During the initial trial, a number of Indonesian agencies, including the Ministry of Environment, the Special Task Force for Upstream Oil and Gas Business Activities, and the Supreme Audit Agency all testified that Chevron’s employees had not broken any laws. Defense lawyers for Chevron Pacific Indonesia rejected the prosecution’s claims and said that its scientific analysis had confirmed that the soil was sufficiently contaminated to warrant bioremediation. They called into question the credibility of the state’s expert witness on bioremediation: T. Mulya Lubis, a defense lawyer, said the prosecutors had “a clear conflict of interest with their witness. If there was any violating, it should be a civil case that would be dealt with through mediation and arbitration, not criminalization.” [4] The National Commission on Human Rights also prepared a 400-page report on the case, in which it said the rights of the defendants had been violated: the defendants had been held for more than two months without charges being brought against them. [2] In May 2013, the anti-corruption court convicted the two directors of Green Planet and Sumigita of corruption and sentenced them to five and six years in prison, respectively [4]. The criminal prosecution of local Chevron employees has sent a wave of fear through Indonesia’s oil and natural gas sector, which is increasingly reliant on the technical expertise and investment. The Chevron case drew an unusual amount of attention in Indonesia, partly because multiple Indonesian government agencies, as well as the country’s independent Supreme Audit Agency, had gone on record saying that no laws were broken. [4]
Basic Data
NameChrevron's activities in Riau province, Indonesia
CountryIndonesia
ProvinceRiau province in the center of the Sumatra Island
SiteManggala Jonson Village; local communities in the Rumbai Coastal area
Accuracy of LocationMEDIUM regional level
Source of Conflict
Type of Conflict (1st level)Fossil Fuels and Climate Justice/Energy
Type of Conflict (2nd level)Oil and gas exploration and extraction
Land acquisition conflicts
Specific CommoditiesCrude oil
Land
Natural Gas
Project Details and Actors
Project Details
Chevron has been Indonesia’s largest producer of crude oil which delivers approximately 40% of national production from its operations in Riau and East Kalimantan and provides electricity for millions of Indonesians from its geothermal projects in West Java. The total cumulative oil production is more than 12 billion barrels.[8]
See more...
Type of PopulationSemi-urban
Start Date27/01/2000
Company Names or State EnterprisesChevron Pacific Indonesia (CPI) from Indonesia
Chevron Pacific Indonesia-Sumatra Light North from Indonesia
Chevron Pacific Indonesia-Sumatra Light South from Indonesia
Chevron Pacific Indonesia-Heavy Oil from Indonesia
Green Planet from Indonesia
Sumigita from Indonesia
Chevron Corporation from United States of America
Relevant government actorsExecutive Agency for Upstream Oil and Gas (BPMIGAS); Local Parliament Commission in the Rumbai Coastal area; Ministry of Environment; Supreme Audit Agency; Special Task Force for Upstream Oil and Gas Business Activities
Environmental justice organisations and other supportersPeasant Group Rantau Bais Terpadu[6];

Friends of the Earth Indonesia-http://www.foei.org/member-groups/asia-pacific/indonesia
The Conflict and the Mobilization
Intensity of Conflict (at highest level)HIGH (widespread, mass mobilization, violence, arrests, etc...)
When did the mobilization beginMobilization for reparations once impacts have been felt
Groups MobilizingFarmers
Local ejos
Local government/political parties
Neighbours/citizens/communities
Social movements
sand miners
Forms of MobilizationBlockades
Land occupation
Official complaint letters and petitions
Street protest/marches
Refusal of compensation
Impacts
Environmental ImpactsVisible: Floods (river, coastal, mudflow), Soil contamination, Oil spills, Waste overflow, Large-scale disturbance of hydro and geological systems
Potential: Biodiversity loss (wildlife, agro-diversity), Food insecurity (crop damage), Groundwater pollution or depletion, Global warming
Health ImpactsVisible: Mental problems including stress, depression and suicide, Other Health impacts, Accidents
Otherasphyxiation, sore throats,burn wounds,oil spill contained hazardous waste, which

was inhaled by the community;skin problems [6]

[6]
Socio-economic ImpactsVisible: Displacement, Increase in violence and crime, Loss of livelihood, Militarization and increased police presence, Violations of human rights, Land dispossession
Potential: Increase in Corruption/Co-optation of different actors, Social problems (alcoholism, prostitution, etc..)
Otherdisenfranchisement
Outcome
Project StatusIn operation
Pathways for conflict outcome / responseCourt decision (victory for environmental justice)
Repression
Do you consider this as a success?Not Sure
Why? Explain briefly.The anti-corruption court, convicting the two directors of Green Planet and Sumigita of corruption, damaged the Chevron's imagine. And of course the citizens and communities protests slowed down the Chevron activities and they have given visibility to environmental problems. But as yet Chevron didn't care to requests and repressed the protests.
Sources and Materials
References

M.H. Hasana, T.M.I. Mahliaa, Hadi Nurc, A review on energy scenario and sustainable energy in Indonesia, Renewable and Sustainable Energy Reviews, Volume 16, Issue 4, Pag. 2316–2328, May 2012
[click to view]

[7] Surya Darma, Sugiharto Harsoprayitno, Bambang Setiawan, Hadyanto,
R.Sukhyar, Anton W.Soedibjo , Novi Ganefianto and Jim Stimac, Geothermal Energy Update: Geothermal Energy Development and Utilization in Indonesia, Proceedings World Geothermal Congress 2010, Bali, Indonesia, 25-29 April 2010
[click to view]

[6] Pius Ginting, WALHI - Friends of the Earth Indonesia, An Alternative Annual Report May 2011, The True Cost of Chevron, p. 39 Indonesia.
[click to view]

Links

Ben Bland and Taufan Hidayat, Chevron employees sentenced in Indonesia corruption case, Asia-Pacific, July 18, 2013
[click to view]

[1]Generating clean, reliable and affordable electricity in Indonesia, The Guardian, 27 February 2013
[click to view]

Cochrane Joe, Chevron worker convicted in corrupt
[click to view]

[8] Chevronindonesia, About Chevron in Indonesia
[click to view]

[3] Fergus Jensen, CORRECTED-Chevron criticises imprisonment of Indonesian contractor, Reuters.com, Wed May 8, 2013
[click to view]

[4] JOE COCHRANE, Conviction of Chevron Worker Spurs Oil Industry Concerns in Indonesia, JULY 17, 2013
[click to view]

[2]MURRAY HIEBERT, Indonesia’s Skewed Case Against Chevron, Nov. 5, 2014
[click to view]

[5]Chevron Statement on Central Jakarta District Court Verdict for Bachtiar A. Fatah
JAKARTA, INDONESIA, October 17, 2013
[click to view]

Other Documents

Spilled oil resulting from the 2010 pipeline explosion in Manggala Jonson Village [6] Pius Ginting, WALHI - Friends of the Earth Indonesia, An Alternative Annual Report May 2011, The True Cost of Chevron, p. 39 Indonesia.
file:///C:/Users/_c_jornades_inv_cea/Desktop/Ejatlas/2011-alternative-annual-report.pdfChevron in Indonesia
[click to view]

Spilled oil resulting from an October 2010 oil pipeline explosion in Manggala Jonson Village. Two local girls suffered burn wounds in the explosion. [6] Pius Ginting, WALHI - Friends of the Earth Indonesia, An Alternative Annual Report May 2011, The True Cost of Chevron, p. 39 Indonesia.
file:///C:/Users/_c_jornades_inv_cea/Desktop/Ejatlas/2011-alternative-annual-report.pdfChevron in Indonesia
[click to view]

Meta Information
ContributorMyriam Bartolucci, EjAtlas internship researcher, [email protected]
Last update11/04/2016
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