SBY Dismisses SKKMigas Chief Rudi Rubiandini as KPK Files Charges

Jakarta Globe, Rizky Amelia, Ezra Sihite & Rangga Prakoso, August 14, 2013

Rudi Rubiandini, head of Indonesian energy regulator SKKMigas, speaks during
 an interview with Reuters at his office in Jakarta in this March 6, 2013 file
photo.(Reuters Photo/Enny Nuraheni)

The head of Indonesia’s oil and gas regulator SKKMigas was formally charged with accepting a $400,000 bribe from a private oil firm the Corruption Eradication Commission (KPK) announced on Wednesday.

SKKMigas head Rudi Rubiandini and two others were named as suspects by the KPK one day after their arrest at Rudi’s private residence in Kebayoran Baru, South Jakarta. Rudi was allegedly caught accepting a $400,000 bribe from an official with the Singapore-based Kernell Oil company.

“[The KPK] has decided to escalate the process from questioning to investigation,” Deputy Chief Bambang Widjojanto said at the KPK headquarters. “We named three people as suspects, ‘S’ for [paying a bribe] and ‘A’ and ‘R’ [Rudi].”

The latter two were named as suspects for receiving money.

The corruption scandal is the latest to tarnish the image of Indonesia’s oil and gas industry. The resource-rich nation is one of the most corrupt in the world, according to Transparency International. The conviction of three local employees of a Chevron subsidiary on disputed corruption charges last month cast a shadow of doubt over the nation’s regulatory environment, prompting concern from foreign investors.

Experts have warned that Indonesia’s endemic corruption and a recent wave of resource nationalism could temper investment and hinder economic growth in Southeast Asia’s largest market.

The central government was quick to assure foreign oil firms that industry activities would continue unaffected by Rudi’s arrest. SKKMigas deputy chief, Johanes Widjonarko, was returning home from a trip in Tokyo to assume his superior’s responsibilities on Wednesday.

“The most important thing is to keep the oil and gas industry running well so that investors and businessmen in this industry remain calm,” Minister of Energy and Mineral Resources Jero Wacik told reporters at the State Palace. “This is just like when BPMigas was disbanded. Our main objective is to make sure SKKMigas and the oil and gas industry is not disrupted.”

President Susilo Bambang Yudhoyono temporarily dismissed Rudi from his post in the wake of the KPK’s announcement. He will be permanently dismissed if his case continues to progress, Jero said.

“If Rudi’s legal case progresses there will certainly be a new [permanent] chief,” he said.

Rudi was appointed as head of the new SKKMigas in January shortly after the previous industry regulator BPMigas was disbanded. He previously worked as an oil and gas expert at the state-run Bandung Institute of Technology.

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