Former CEO of Indonesia's Pertamina jailed over Cheniere LNG contract

Former CEO of Indonesia's Pertamina jailed over Cheniere LNG contract

A former chief executive of Indonesia's state energy firm Pertamina has been sentenced to nine years in jail for graft in a case related to a long-term contract to procure liquefied natural gas from a unit of U.S. company Cheniere Energy.

The Central Jakarta Corruption Court on Monday found Karen Agustiawan guilty of improper procurement from the unit, Corpus Christi Liquefaction, a video of the hearing showed. The court also fined her 500 million rupiah ($30,544).

Her lawyer, Luhut Pangaribuan, told Reuters on Tuesday that she would appeal the verdict.

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"Cheniere follows all applicable laws, domestic and international, and adheres to the highest ethical standards in our contracts and in our daily business," a Cheniere spokesperson said, adding that the company's relationship with Pertamina is no different.

Pertamina said it respected the legal process when asked for comment.

Pertamina's first female CEO, who led the company between 2009 to 2014, Agustiawan was found guilty of improperly signing a long-term sales and purchase contract with Corpus Christi, a deal that caused state losses of $113.84 million between 2011 to 2014, according to state news agency Antara.

Cheniere's Corpus Christi export facility was not producing LNG until 2018 and the plant's first cargo to Pertamina was not supplied until 2019, the company said.

Pertamina had resold LNG cargoes from Corpus Christi to the international market at a loss because the market in Indonesia could not absorb them, local media reports said.

Agustiawan had denied any wrong doing and said she was following government orders.

Corpus Christi was not a defendant in the case, but the panel of judges at the court said it had the "responsibility" to repay the country for the losses, media reported.

In a separate case in 2020, Agustiawan was acquitted by the Supreme Court when it overturned an eight-year prison sentence handed by a lower court over her decision for Pertamina to invest in the Basker Manta Gummy Block in Australia in 2009. The court had ruled at the time that her business judgment was not a crime.

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