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September 19, 2001
ExxonMobil's Troubled Relationship in Aceh
    by Anne Moore Odell

Questions are being raised about ExxonMobil, the world's largest integrated oil company, retaining the Indonesian army and police forces for security.

In August 2000, Jafar Siddiq Harrizah went missing. In early September 2000, he was found murdered along with four others. Jafar, permanently based in New York City, was a human rights activist from Aceh, Indonesia, and founder of the International Forum on Aceh. Aceh is a region on the island of Sumatra in Indonesia that happens to be rich in liquid natural gas deposits.

ExxonMobil (ticker: XOM) is currently conducting drilling operations in Aceh and is employing Indonesian military and police forces for security purposes. Security is presumably needed because there has been a rebel movement in Aceh for over 25 years. The movement became official in 1980 with the creation of the Aceh freedom movement, or GAM (Gerakan Aceh Merdeka).

ExxonMobil's presence in Aceh dates back to the 1960's, when Mobil signed an agreement with the Indonesian state fuel company Pertamina to tap LNG. ExxonMobil provides 20 percent of Indonesia's foreign exports.

Although the Indonesia Army denies involvement, most observers assume that it is behind Jafar's murder and many other unsolved deaths.

In June of this year, ExxonMobil was sued by the International Labor Rights Fund in U.S. federal court because of its relationship with Indonesia's military and police regarding human rights abuses. Concerned investors and individuals are questioning ExxonMobil's behavior in Aceh, and asking the company to review its practices involving Indonesia's armed forces.

A report entitled "The Conflict in Aceh, and U.S. Interests in Promoting A Free Market, Stability and Human Rights in South East Asia," details many of the documented atrocities of the Indonesian Army. The author, Robert Jereski, is the former Executive Director of the International Forum for Aceh. The report acknowledges that since the early 1990s, the United Nations, the U.S. State Department, and international human rights organizations have reported serious and systematic violations of human rights by the armed forces of Indonesia. However, Jereski believes foreign governments have not done enough to protect human rights and promote democracy in Indonesia.

As Indonesia continues efforts to become a free market economy, corporations interested in doing business there must face the illegal activities of the Indonesian military and police and their stranglehold on Aceh's economy. The report states that the military and police "control large amounts of resources, which allow them to intervene in politics and in the free market in illegal ways. The police have violently intervened in labor disputes. The armed forces' foundations (yayasans) represent political slush funds for opponents of reform."

Jereski reports that ExxonMobil pays the military and police for security of its operations in Aceh. ExxonMobil itself is not immune to the Indonesian military's corruption as its planes have been targeted, equipment has been stolen and employees have been held for ransom. Yet ExxonMobil supports the army. Jereski writes, "ExxonMobil's security has nevertheless provided the Indonesian military with a much-needed pretext to escalate its operations in Aceh, resulting in a dramatic escalation in human rights abuses."

The report concludes with a list of recommendations for the United States Government regarding Indonesia. Jereski asks that the oil and gas giant be held responsible for its actions in employing a corrupt military which may be also involved in gun running, extortion and illegal drugs. The report also suggests steps that activists and concerned investors can take to change ExxonMobil's actions in Aceh, and to protect the rights of Indonesian citizens.

ExxonMobil's official website responds to the accusation and lawsuit: "We are disturbed by any suggestion that ExxonMobil or its affiliate companies are in any way involved with alleged human rights abuses by security forces in Aceh. ExxonMobil condemns the violation of human rights in any form and categorically denies these allegations. We are deeply troubled and highly concerned about the violence in North Aceh, and it is our steadfast hope that the political and economic turmoil in the province will be peacefully resolved."

Changes are happening in Aceh. On September 8, 2001, Indonesia's new president Megawati Sukarnoputri offered Aceh her apology for the thousands of deaths in Aceh's separatist war. She acknowledged the last government's mistakes and made a call for peace. Recently passed laws give Acehians a larger percent of revenues made from natural resources, including the oil fields operated by ExxonMobil. However, the Associated Press has reported that rebels will continue their war for separation.


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