Thai firm rejects Indonesian oil spill cash claim

Montara spill is said to be Australia`s worst offshore drilling accident.

Last Updated: Sep 03, 2010, 12:11 PM IST

Sydney: A Thai-owned firm on Friday rejected Indonesia`s USD 2.4 billion compensation claim over a major oil spill off Australia`s north which campaigners say hit the livelihoods of thousands of poor fishermen.

PTTEP Australasia, a unit of Thailand`s PTT Exploration and Production PCL, said it "has not accepted any claim" by Indonesia over the months-long Montara spill, Australia`s worst offshore drilling accident.

"PTTEP Australasia wishes to confirm that it has not accepted any claim made by the Indonesian government for compensation," a statement said, adding that "no verifiable scientific evidence" has been given to support the claim.

Indonesia made the claim this week, saying it included compensation for damage to coral reefs.

The leak in the Timor Sea from August 21 to November 03 was the worst from an offshore oil platform in Australian history, although it was smaller than the recent BP spill in the Gulf of Mexico.

Like the BP spill, it dragged on for months as the company tried to plug the flow with a relief well, a process that eventually succeeded.

It also led to calls for tougher regulation of offshore drilling and criticism of the authorities responsible for monitoring the operation.

Evidence given at a commission of inquiry showed the Montara slick grew to almost 90,000 square kilometres (35,000 square miles) and entered Indonesian waters, according to environmental group WWF.

The West Timor Care Foundation, which supports poor fishermen in eastern Indonesia, estimates the spill affected the livelihoods of about 18,000 fishermen. Businesses such as seaweed and pearl farms were also reportedly hit.

Following this year`s Gulf of Mexico spill, which was the biggest maritime spill on record and spewed some 4.9 million barrels of oil, BP set up a USD 20 billion compensation fund.

Bureau Report