[Kabar-Irian] Irian News - 3/21/06 (Part 3 of 3)
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The Age (Melbourne)
West Papua on edge over mine
By Mark Forbes
March 22, 2006
West Papua's parliament has abandoned a planned debate on the future of
the Freeport gold mine amid fears of further bloodshed. But activists have
vowed to hold more demonstrations unless the meeting proceeds soon.
Indonesian Intelligence Agency chief Syamsir Siregar also reportedly said
yesterday that an Australia-linked aid organisation might have been behind
Thursday's anti-Freeport demonstration in Jayapura that resulted in the
deaths of three police and an intelligence officer. His office declined to
provide details.
Several hundred activists and students remain in hiding on the outskirts
of Jayapura and the surrounding jungle, fearful of arrests and police
reprisals.
Most members of Brimob, the police riot squad whose three colleagues were
beaten and stabbed to death as they attempted to break up Thursday's
demonstration, remained confined to their barracks.
Police spokesman Kartono Wangsadisastra said the guns of about 40 Brimob
members had been confiscated, as they were "angry", and also to aid the
investigation into which weapons had been fired during and after the
demonstration.
At least three people, including a 12-year-old girl, were wounded by
police gunfire on Friday during sweeps for suspects. Colonel Kartono said
they were injured by bullets fired into the air.
He denied that any protesters were shot on Thursday, contradicting witness
accounts. Rights groups and journalists have been unable to visit the
hospital treating the wounded.
West Papua's parliament and assembly, or legislative review body, which
were both scheduled to debate the Freeport crisis yesterday, were expected
to call for the contract at the world's largest gold mine to be
renegotiated. Some members are insisting on the mine's closure, an option
Indonesia has rejected, claiming it would discourage foreign investors.
Assembly head Agus Alua said the debates were cancelled due to the need to
gather more information about Freeport's operation and concerns about
Thursday's clash. He said the assembly would recommend that Freeport's
contact be renegotiated to provide more funds to the community.
"If Freeport wants to continue they have to fulfill our recommendations,"
he said.
Parliament's Speaker Komarudin Watubun said its meeting would be postponed
up to two months as protests had hampered inquiries.
Freeport opponents reacted angrily. Spokesman Markus Haluk said if the
debates were not held within two weeks "we will mobilise the masses, we
will occupy the parliament building".
"We are committed to Freeport's closure; we will not step back," he said.
"The test for Jakarta is if they want to win Papua's heart or Papua's
gold."
Freeport is Indonesia's biggest taxpayer, contributing more than $1
billion in revenues.
Protesters claim little of the revenue is spent locally and the mine has
caused extensive environmental damage. They allege that Freeport has been
complicit in human rights abuses by paying for local military operations.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Paras Indonesia (formerly Laksamana)
Rights Watchdog Demands Papua Probe
Posted by: Roy Tupai on 03, 20 2006 @ 10:56 pm
New York-based Human Rights Watch has called for an independent
investigation into the deaths of three policemen and one Air Force officer
at the Freeport gold and copper mine in Papua province.
The security personnel were killed during a clash with protesters in the
provincial capital Jayapura last Thursday (16/3/06). Following is the text
of Human Rights Watch’s statement.
Investigate Escalating Violence in Papua
(London, March 17, 2006) – Escalating violence in Papua's provincial
capital should be investigated by an independent commission, Human Rights
Watch said today. Demonstrators and police clashed in the provincial
capital Jayapura this week, causing the deaths of four Indonesian
policemen and seriously injuring several civilians. Human Rights Watch
called for an independent investigation by Indonesia's National Commission
on Human Rights (Komnas HAM) into the incident, and for other domestic and
foreign independent monitors to be allowed access to the area.
Some 150 demonstrators, including students from the University of
Cenderawasih, have spent the last two days demanding the withdrawal of the
Indonesian army (TNI) and police from Papua, and the closure of the
U.S.-owned Freeport mine in Timika, Papua. In response to the
demonstrators' attempts to block the road in front of the university,
Indonesian riot police yesterday moved in to break up the demonstration,
resulting in the violent clashes.
"These are deeply disturbing accounts of violence," said Brad Adams, Asia
director for Human Rights Watch. "The Indonesian government should
immediately grant access to an independent investigation by Komnas HAM and
Indonesian NGOs to determine how the violence escalated."
Human Rights Watch said that the report of the investigation must also be
made public.
Reports indicate that BRIMOB (Brigade Mobile, Indonesian riot police)
officers used tear gas, and some eyewitnesses say that they saw the police
open fire on the crowd of unarmed demonstrators. In response the crowd
attacked the riot units and beat to death four policemen, injuring at
least 19 other officers.
Media reports indicate that two civilians may also have been killed in the
clashes. Local human rights groups report that at least six demonstrators
were seriously injured, one of whom is in critical condition. Some of
those injured are receiving treatment for gunshot wounds, and all are
currently in Abepura hospital. One of those wounded is a journalist from
the Indonesian newspaper Tempo. Unverified reports indicate he was beaten
by police officers while trying to film the demonstration.
In addition to an independent investigation, Human Rights Watch also
called for the removal of arbitrary restrictions on access to all regions
of Papua by journalists, human rights workers, and other independent
monitors. In response to government announcements that no foreign media
would be allowed to Papua, Human Rights Watch wrote a letter to Indonesian
president, Susilo Bambang Yudhoyono in February, warning that the lack of
access and monitoring to Papua by independent observers, including the
media, would create a climate in which the armed forces and police believe
they can act with impunity and commit abuses, unreported and away from the
public eye.
"This is an opportunity – albeit a grim one – for the government to open
up access to the province and allow independent monitors, media and human
rights organizations in," said Adams.
Human Rights Watch has received reports that at least 20 demonstrators
have been arrested by the police and are currently being held at the
police station in Jayapura. Local human rights organizations have been
denied access to them. Unverified sources report that two of the
Cenderawasih University student dormitories have also been shot at with
automatic weapons, with gunshots being heard in Jayapura hours after the
demonstration had ended.
"While all efforts must be made to bring perpetrators of killings to
justice, arbitrary, retaliatory attacks on the general Papuan population
are never justified," said Adams. "Worse, attacks on the public will only
undermine potential cooperation from witnesses and other victims."
In another region of Papua, reports have emerged of the destruction of
part of the Sheraton hotel in Timika, adjacent to the Freeport copper
mine. Anti-Freeport demonstrators attacked the hotel after being unable to
address local officials meeting with Freeport representatives. At least 15
people are reported to have been arrested in relation to the attack.
Background
An ongoing, low-level armed insurgency in Papua, in the easternmost part
of Indonesia, has resulted in crackdowns by Indonesian security forces
with ensuing human rights violations. Since 2005, there has been a visible
build-up of troops in the province with reports of widespread displacement
of civilians, arson, and arbitrary detention in the central highlands
region.
Demonstrations against Freeport have increased in recent months after
Freeport security forces tried to evict local miners, alleging their
activity was illegal. Protestors accuse Freeport of not providing enough
to the people of Papua in return for the mine, polluting the local
environment, and for being responsible for human rights abuses through
their use of the military for security services.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The Jakarta Post.com
Editorial
March 20, 2006
Losing Papua
Days after peaceful gubernatorial elections in the provinces of Papua and
the newly established West Irian Jaya, three policemen and a member of the
Air Force were killed in clashes with protesters demanding the closure of
the Freeport gold and copper mine, the largest in the world.
We condemn the killings and urge the government to bring to justice those
who are responsible for this butchery. The killings were inexcusable,
whatever their motivations. We also urge the government to set up an
independent team to investigate the incident and discover the real roots
of the problem.
Despite criticism of the police's handling of the protests, it is in the
interests of the nation and civil society that the National Police, not
the Indonesian Military, remain in charge of domestic security and public
order.
We also express our condolences to the families of the four victims. We
hope the government will carry out its duty and ensure the families
receive help to start new lives without the presence of their beloved
husbands and fathers. These men and their families deserve more than just
a state funeral and empty praise.
It may have surprised many how the young Papuans expressed the outrage
they feel toward Freeport and the government. As the demonstration took
place in front of Cendrawasih University we assume that many of the
protesters were students. It seemed that they did not fear for their own
safety.
One could compare the convictions, even the fearlessness, of the young
Papuans to those of the student protesters who clashed with riot police in
the weeks before Soeharto's fall in May 1998, and during demonstrations
against Soeharto's successor, B.J. Habibie. They felt cheated by the
government and no longer trusted it. They decided to confront
state-sanctioned violence and terrorism, risking their lives in the
process. If the Papuan students lose all trust and hope in the central
government, then the situation could become much more dangerous.
The government needs to allay the concerns of the Papuan protesters as
soon as possible. It needs to convince them the central government
understands the aspirations of the Papuan people, and be credible in
dealing with their frustrations and anger.
President Susilo Bambang Yudhohyono has repeatedly said that his
government fully understands the Papuans' grievances and that his
government has learned much from its dealing with the rebels in Aceh.
Despite this, however, we feel that there is little reason to hope that
the President will be able to realize his promises to the region. Why?
Because it was the President himself who promised his government would
follow the law on special autonomy for Papua when resolving problems in
the frequently rebellious territory. But West Irian Jaya was formed
despite protests from the tribal chiefs' council, the Papuan People's
Assembly, the Papuan Legislative Council, religious leaders and university
students. Many Papuans feel grossly betrayed by the central government.
Protests against the Freeport mine are often regarded as a threat to
lucrative state revenue, a tool used by members of the political elite
both in Papua and Jakarta to gain financial advantages. Many if not all of
the social issues that the protesters raise are ignored.
PT Freeport itself cannot simply respond by claiming that it has met its
obligations to the state and the people through being the biggest taxpayer
in Indonesia. The roots of the local people's dissatisfaction with the
mine are not only economic. The company has little to say about the impact
its mine has had on local indigenous people, and how it has changed their
lives since being established in the 1970s. The company's ethical record
is questioned by many observers, both in Indonesia and overseas.
In other words, the reasons for the protests in Papua are obvious. The
government cannot continue to buy time by claiming that it needs to study
and discuss the origins of the problems. It must deal with them now.
There is a common tendency in this country, particularly among the
political elite and the decision makers, to treat Papuans as uneducated
and stupid, simple tribespeople who are ungrateful for the services
provided by the government. This could prove a fatal mistake.
The previous government practiced this in East Timor and we lost the
province in 1999. It is only a matter of time -- perhaps not long at all
-- before Papua is no longer a part of Indonesia. If the central
government and the powers in Jakarta continue to think that only they know
what is best for Papuans, then it is surely inevitable.
As citizens of Indonesia, Papuans are entitled to be treated with the same
level of respect afforded to other Indonesians. They deserve the right to
preserve their culture and ethnic identities. It is not impossible that
Indonesia will need to redraw its map again, if the Papuans decide enough
is enough and are ready to sacrifice their own lives to throw off the
state which continues to oppress them.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The Jakarta Post.com
Opinion
March 21, 2006
The natural resource dilemma for government
Vincent Lingga, Jakarta
How the government resolves the imbroglio currently gripping mining firm
PT Freeport Indonesia and its operations in Papua will have a very
significant bearing on other big mining ventures already operating, as
well as on new investment in mineral development.
Mining, in addition to fisheries and plantations, should be one of the
most promising resource-based ventures in Indonesia, thanks to the
country's major reserves in oil and natural gas, copper, old, nickel,
coal, tin, silver, diamonds and base metals.
However, legal and regulatory certainty is vitally important, especially
for mining firms to invest, because this business is usually capital- and
technology-intensive and very risky. It has a long payback period and the
companies must operate mostly in remote areas where basic infrastructure
is extremely inadequate.
But it is legal and regulatory certainty that has increasingly become a
big issue after the launching in 2001 of regional autonomy, including the
devolving of the central licensing authority for mining concessions --
with the exception of oil and natural gas -- to regional administrations.
Even tree-crop plantations, which are labor-intensive and generally
eco-friendly, have been facing a plethora of obstructive bylaws. Only last
Wednesday, executives of the Palm Oil Producers Association called on
President Susilo Bambang Yudhoyono, urging him to remove the myriad of
anti-business regulations, which have adversely affected the international
competitiveness of Indonesia's palm oil industry.
There has been a perception, right or wrong, among the public, that most
major mining companies -- which obtained their concessions under
Soeharto's authoritarian rule between 1967 and 1998 -- bulldozed their way
through the licensing system to obtain all the necessary permits for their
operations in collusion with corrupt officials.
The democratic era and regional autonomy have encouraged local people, who
for more than 32 years were completely excluded from the decision-making
process regarding the exploitation of local natural wealth, to forcefully
assert their rights.
They often resort to venting their frustrations during street protests and
irrational demands that the mining operations in their areas be simply
closed down, claiming that the mines have not benefited the local
community, but have instead damaged the environment.
This is really a challenge for the government and investors because
protesters usually consist of a mix of local leaders, pressure groups,
human rights activists and environmentalists, some with genuine causes and
legitimate grievances, but many others with self-seeking interests.
Certainly, business is not always right and those, which are found guilty
of violating the laws and neglecting their social responsibility, must be
brought to justice. But on the other hand, those which are not guilty but
still find themselves being harassed and subjected to spurious claims,
should be protected by the government.
Since protest demonstrators often block entry to a mine or plant,
businesses need the government's firm action to get the protesters out of
production compounds and to redirect their grievances to consultative
forums or the court system.
Street protests, if not handled properly, will allow the mobs to have a
field day, and businesses will be at the mercy of lynch mobs.
Simply ordering the closure of a mine without due process of the law boils
down to the government succumbing to the mob's ultimatum, a precedent
which could threaten the fate of many other resource-based investment
ventures.
Only when there is certainty and consistency in law enforcement, so that
the course of investment can reasonably be predicted, will big investors
be interested to plough their capital in Indonesia.
Investors, domestic or foreign, understand and often expect that laws or
rules can change over time to address social issues, new aspirations and
new economic developments. But they will not accept unilateral official
decisions made without any clear legal basis, merely the tremendous
pressure from public protests.
It is always unpopular to stand up in the defense of big business,
especially foreign big business, and politicians like the President,
well-known now for his indecisiveness, do not like to do unpopular things.
But the experiences in other countries also demonstrate that a sign of
true leadership is the ability to take the unpopular, yet vital, action
that is in the best interest of the public.
Regional administrations also have a great interest in attracting more
investments in natural-resource based ventures. Under regional autonomy,
they are now entitled to 80 percent of the land rents and royalties from
fisheries, forestry and mining companies. The revenue split between the
central government and regional administrations is 85:15 and 70:30,
respectively.
On the other hand, investors too should realize that merely abiding by the
laws is no longer sufficient to secure smooth business operations. They
should broaden their social responsibility, not by philanthropic
activities, which will only create a sense of artificial prosperity, but
by empowering the local community through programs, which are designed to
gradually transfer business, technical and social competence to local
communities.
Successful investment ventures have shown that businesses, which have
fulfilled their social obligations, are less vulnerable to pressures from
local communities or administrations.
After all, a company's best defense is its reputation in the community.
-- The writer is a senior editor at The Jakarta Post
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Resource Investor
Is It Time to Steer Clear of Indonesia?
By Jon A. Nones
20 Mar 2006 at 05:07 PM EST
St. Louis (ResourceInvestor.com) -- After weeks of relentless protests
staged against Freeport-McMoRan’s Grasberg mine, it would appear Newmont
is the next target. But as most of us know, Newmont is no stranger to
trouble in Indonesia. When is it time to say enough is enough in this
volatile country?
Barely one month after Newmont Mining [NYSE:NEM] agreed to pay Indonesia
$30 million to settle a civil suit over pollution at Buyat Bay, an
unidentified group of 50 people today torched a worker camp on the
company’s Sumbawa Island property.
According to various press wires, the assailants were demanding
unspecified amounts of “compensation” for the exploration activity.
Newmont was forced to close the Elang camp and suspend exploration in the
area, but work at its massive Batu Hijau copper-gold mine on the island
was unaffected.
Fortunately, no one was injured in the attack, which is more than we can
say for the ongoing protests aimed at Freeport-McMoRan [NYSE:FCX].
Just last week, three policemen and a soldier in Indonesia's Papua
province died in clashes with protesters over Freeport-McMoran’s Grasberg
mine. Around 19 other police officers had to be rushed to the hospital due
to injuries.
Freeport was forced to suspend operations on March 1 after 500 locals set
up barricades on a road leading to the site. The protestors were demanding
the right to illegally sift through and sell tiny amounts of gold and
copper in the tailings river.
And this followed with protests in Jayapura and Jakarta led by the
anti-mining NGO groups, where “scuffles” were and still are frequently
erupting.
Richard Adkerson, President and CEO of Freeport-McMoRan, told listeners at
the BMO Nesbitt Burns Global Resources Conference earlier this month:
“This is just part of the scenery of being in the mining industry today.”
However, even Indonesia's President Susilo Bambang Yudhoyono said he was
sending officials to the scene and his ministers would investigate issues
raised in controversy over the mine.
There have also been rallies over a deal last week between Indonesia's
state-owned oil company and Exxon Mobil Corp. [NYSE:XOM] to jointly
operate the country's largest untapped oil field in Cepu, Java Island.
And don’t forget, Newmont executive Richard Ness still faces criminal
charges in the country. And the list goes on and on….
Granted, giants like Newmont and Freeport-McMoRan have more resources per
say to overcome much of this risk. But what of the juniors currently
exploring?
Junior Companies
Aside from the big boys mentioned above and nickel giant Inco [NYSE:N;
TSX:N], there are a number of junior exploration companies currently
braving Indonesia.
Pencari Mining Corporation [TSXv:PMC], formerly Azure Resources Corp., has
a 90% interest in the Pani Property, located in North Sulawesi, Indonesia.
The property was previously explored by BHP and Utah Mineral International
Corp, and has an indicated resource of 431,451 ounces of gold and an
inferred resource of 31,814 ounces.
Petromin Resources Ltd [TSXv:PTR] maintains a 70% interest in the Muko
Muko gold mining property in the province of Bengkulu in south Sumatra,
Indonesia. The land covers over 500 square miles (approximately 151,000
hectares) within the northern portion of the Lebong Gold District, which
includes a trend of old mines and mineral properties that stretches for
approximately 150 km along the west side of the Great Sumatran Fault.
Twin Mining Corporation [TSX:TWG] has an 85% interest in the Layuh
gold-copper property, located in the province of South Kalimantan.
According to the company, a number of short trenches have returned
encouraging results: one trench showing 15 metres at 2.15 g/t Au and
anomalous samples occurring throughout the whole length of the 40 metre
trench.
Vista Gold Corp [AMEX:VGZ; TSX:VGZ] acquired the Awak Mas property in May
2005, located in Sulawesi, Indonesia. The deposit contains a measure and
indicated resource of 1.65 million ounces of gold, according to company.
Waseco Resources Inc [TSXv:WRI] owns the Tewah Alluvial Gold property in
Kalimantan. The deposit contains 750,000 ounce gold resource with an
additional 2 million ounces identified by riverbanks. Should financing
become available, the company predicts a cash cost of $93/oz with a mine
life of 17 years.
The above companies all had interests in Indonesia, but not solely. The
companies below have all their eggs in one rickety basket.
Indonesia Only Juniors
Apolo Gold Inc. [OTCBB:APLL] has the development rights to a gold-silver
property in Sumatra, Indonesia. According to the company, the mine will be
a low cost operation once production is achieved with costs under
$100/ounce. The company also boasts excellent relationships with
government, the property owner and the local mining community.
Kalimantan Gold Corporation Limited [TSXv:KLG] has four porphyry
copper-gold-silver prospects located in Kalimantan, Indonesia: Baroi,
Beruang Kanan, Focus 1 and Mansur. The company has 18 years of experience
working in Kalimantan and has identified 38 prospects in that time,
according to the website.
Pacific Wildcat Resources Corp’s [TSXv:PAW-H] Sulut gold property is
located adjacent to the town of Kotabunan on the northeastern tip of the
island of Sulawesi in Indonesia. According to the company, Sulut has 1.2
million ounce of gold resource as well as an extensive regional
reconnaissance program.
Weda Bay Minerals Inc [TSX:WDA] owns the rights to develop the Halmahera
property, located on Halmahera Island in the North Maluku province of
Eastern Indonesia. Based on the extensive nickel and cobalt resources
identified to date, the company is proposing to develop a mine and
processing operation with the capacity to produce up to 60,000 tonnes of
nickel and 5,000 tonnes of cobalt annually.
Southern Arc Minerals Inc [TSXv:SA] has a total of seven mineral
properties located in Lombok, Sumbawa and Flores Island. The company’s
goal is to become “the premier mineral exploration and development
company” in Indonesia.
Conclusion
Based on the findings of Newmont and Freeport-McMoRan, we know that
Indonesia has ample resources at a very low cost of production. However,
the recent attack on the big boys, whether it isolated or specific to each
case, still leaves an unsettling feeling in regards to the little guys.
Alex Turkeltaub, Managing Director of Frontier Strategy Group, told
Resource Investor that the next five years are going to be very slow years
for investment in the country.
“Any junior that hopes to get a big buy out or investment from a major,
won’t get it” with things as they are in the country at present time, he
said.
The Frontier Strategy Group recently gave Indonesia a triple “C” rating in
its “Above-Ground Risk Report” - one of the lowest scores.
Turkeltaub said this is because Indonesia has a high level of corruption,
community unrest and a government that will do little about it.
However, Indonesia’s willingness for political cooperation with the U.S.
is “the light at the end of the tunnel,” said Turkeltaub. He added that 10
years from now we could see a serious turnaround in the country.
But until then, investors proceed with caution.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The Jakarta Post.com
Business News
March 20, 2006
Trigana Air: An entrepreneurial success story in eastern RI
Alvin Darlanika Soedarjo, The Jakarta Post/Jakarta
As Indonesia works to accelerate development in eastern parts of the
country, aviation plays a crucial role since many paths between towns or
regencies cannot be reached by cars or trucks.
Trigana Air Service -- established as a company in 1991 -- operates most
of its aircraft in eastern parts of Indonesia, flying over deep valleys
and pristine jungles to serve areas in Borneo and Papua.
While many airline carriers compete for the "fat" routes between main
hubs, Trigana maximizes its strength to concentrate on "slimmer" options:
cargo and feeder services. Trigana transports basic materials to remote
areas in Papua and takes passengers to Borneo and East Nusa Tenggara.
The carrier, which employs 150 air crew and 80 ground staff, has managed
to expand its fleet from four to 17 aircraft while many other domestic
airlines continue to scale down their fleets. In the course of the last 15
years, Trigana has modified its approach from aerial photography to full
freight services as well as half cargo and half passengers services.
The Jakarta Post recently interviewed the president director and owner of
Trigana, Triputra Yusni Prawiro, better known as Yusni, 43, about the
company's growing business.
Question: How did you start Trigana Air Service?
Answer: Well, I have always loved aviation since I was a child and this
business started out as a hobby.
It started in the early 1990s, when the government introduced a program to
develop the economy in eastern parts of Indonesia. Before Trigana was
born, I was already involved in a few companies in eastern areas.
There was an opportunity for air services at that time and we started
building Trigana with a vision to help develop means of transportation in
those areas. The aviation industry had an opportunity to grow there
although airlines such as Merpati Nusantara Airline already existed.
Our first planes were Beech King Air and we had four of them, of which two
were owned and the other two leased. We flew our aircraft back then mainly
for aerial photography and landscape mapping. Trigana customers were
mainly government institutions transporting basic materials to remote
areas and forestry companies.
After operating those King Air planes for a few years, we thought that
they had reached the end of their usefulness. We replaced them with Fokker
F-27 planes with an emphasis on services in Papua.
Why did Papua become a priority?
At the time, Papua wanted to build its tourist industry. Then I asked
myself "how?". I met with Papua's governor at the time, Jacob Pattipi, who
had a mission to develop Asmat (tribal) culture and expose it
internationally.
We had a partnership with Irian Bakti, a local company that had rights to
distribute basic consumption materials, such as sugar, oil and rice, to
all parts of Papua. We operated our aircraft to transport them.
At one point, we realized that our fleet was not large enough. Once there
were a lot of accumulating materials that expired before they reached the
end users. We saw rice that had turned to displeasing colors. It was hard
to imagine people eating it.
The government's plan to build the Trans Papua, a highway network that was
to connect many parts of the island, had not materialized. So aviation
naturally made a big contribution there.
What other aircraft did Trigana operate there?
Besides the F-27, we also operated Twin Otter and Potter Pilatus. We
operated the F-27, with a capacity of four tons, to serve between main
airports, such as Sentani and Wamena. The Twin Otter, with a one-ton
capacity, served districts and the Potter Pilatus, with less than a ton,
served subdistricts.
Transporting cargo only?
That's right. However, about four years ago we had an airline permit for
regular flights to serve passengers.
Before, Trigana only had a charter permit. After that we added to our
fleet, and we decided that we could establish partnerships with companies
that did not have Air Operator Certificates (AOC).
Our partners are KalStar, operating in East Kalimantan with a base in
Serpong (Banten) and TransNusa Air, operating in East Nusa Tenggara with a
base in Kupang. These companies have assigned Trigana to fly passengers
using our aircraft.
In this case, Trigana does not have to worry about load factor because
Trigana does not issue tickets. They have agreed to pay Trigana a certain
amount of money no matter the number of passengers served.
Soon TransNusa and Trigana are going to begin operating our first Boeing
planes. Now we are operating aircraft such as the ATR, F-27, Caribou and
Twin Otter serving places such as Nabire, Sentani and Wamena in Papua,
Kupang in East Nusa Tenggara, Balikpapan, Tarakan and Pontianak in
Kalimantan as well as to Ambon.
What is your strategy to survive the competition?
We specialize in serving passengers and carrying cargo to remote areas
instead of provincial hubs. All the hub routes have already been taken by
Garuda, Batavia Air, Adam Air and other big carriers.
We don't have a base in Jakarta because of the specialization. Passengers
can reach big cities with bigger airlines and proceed to smaller places
with Trigana. It is a promising business if we execute everything
correctly.
After the Asian financial crisis back in the late 1990s, we could only
lease and purchase second-hand aircraft with emphasis on maintenance.
Our assets have cost us a huge amount of money. If I had a chance now to
start this business again from scratch, I do not think I could do it
considering the competition and enormous financial capital required.
As for our crew, changing careers is fine with me, as long as they retain
their aviation prowess they built and reputation once they move to other
companies.
How is the competition now?
The competition for main hubs right now is quite fierce. Many carriers
issue tickets lower than the prices stipulated by air transportation
directorate general.
Furthermore, the building of infrastructure is mandatory now for every new
airline. For example, a carrier has to build a facility in each airport
supporting its airplanes. We choose to be in feeder services because we do
not have to compete in prices. We do not want to compromise on prices
related to safety.
The profit that we earn goes directly to improving the safety of our
flights and investing on incoming aircraft. We are talking about human
lives here, so safety is of paramount concern and remains our biggest
challenge.
Do you have any direct competitors?
Airlines operating on the same level with us in eastern sections are
Merpati and Airfast Service Indonesia. However, we don't position
ourselves as Merpati's competitor. Our relationship is more like assisting
each other if a problem occurs. For example, if we cannot operate our
aircraft to somewhere, Merpati will cover our place and vice versa. Under
the national program, we should develop those areas together.
What is Trigana's key to staying in business?
The key is to keep operating most of our aircraft because down time or
idle planes will mean bigger expenses for us than flying them. We just do
our best to serve our customers and keep their trust to continue flying
with us. Basically, we rely on simple word-of-mouth marketing.
Do you have a favorite story relating to your career so far?
There was an incident once in Papua. One of our planes accidentally ran
off the landing strip. There were no victims. Afterward, local people who
witnessed the incident, came to our pilots with tears running down their
faces. Then one of our pilots asked, "Why are you crying?" One replied
that on behalf of the whole community, they would be very saddened if a
Trigana plane had an accident or crashed anywhere. "Because if the plane
could not reach us anymore, then what were we going to eat?" he said.
At that moment I realized that we are actually doing something worthwhile
for the community -- a sort of a social function. This background makes us
work harder to stay on the scene and deliver the goods.
KABAR IRIAN ("Irian News") www.kabar-irian.com
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