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Indonesia demands $2.4b over oil spill

Updated: 2010-09-01 11:42

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Indonesia has demanded 2.4 billion dollars in compensation from a Thai oil company for damages related to a spill off the northwestern coast of Australia last year, a senior official said on Tuesday.

Transportation Minister Freddy Numberi said the claim for 22 trillion rupiah ($2.4 billion) had been presented during talks with PTT Australasia, a unit of Thailand's PTT Exploration and Production PCL, in Australia last week.

"Our calculation includes potential damage to the coral reef in the affected area," Numberi was quoted as saying by Dow Jones Newswires.

The minister is leading a government team in negotiations with the Thai company, which has asked for detailed scientific evidence to back up Indonesia's claims.

"PTTEP has ... joined hands with Australian authorities concerned to closely follow the environmental situation," the company said in a statement on Friday, adding that the spill was limited to an area around its damaged Montara well.

The leak in the Timor Sea from Aug 21 to Nov 3 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 regulations for 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 km and entered Indonesian waters, according to the World Wildlife Fund, an environmental group.

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

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Todd Balazovic is a reporter for the Metro Section of China Daily. Born in Mineapolis Minnesota in the US, he graduated from Central Michigan University and has worked for the China daily for one year.