1. PT Lapindo Brantas and Sidoarjo Mudflow
Case Study For Lessons From Flops
Information Entrepreneurship Developed by:
Fransisca Katherina Rumambi - G1200547C
15 September 2012
FRUMAMBI001@e.ntu.edu.sg
Knowledge Management - WKWSCI
Nanyang Technological University, Singapore

2. Company Profile
Aburizal Bakrie
A business tycoon and member of
government coalition
Joint Venture
PT Lapindo Brantas, Tbk
An Indonesian oil and gas
exploration company

3. Problem: What Happened?
Company’s failure to install casing around the well to
the levels required Indonesian mining regulation DISASTER!
PT Lapindo Brantas
The mud started The pressurised mud
Banjar Panji I gas The unstoppable
seeping into the well at forcing its way to the
exploration well mudflow started in
a depth of around 1,800 survey about 180 m
reached more than Sidoarjo
m and cement plugs near the well
3,000 m

4. Lack of careful
planning and
thorough analysis to
deal with the risks
that might occur in
drilling area

5. Attempts To Stop the Mudflow

6. Impacts
• 12 villages – 350 hectares of • The mud swamped irrigation channel
farm land buried and drainage.
• 30 factories affected by the • The drinking water pipes affected of
mudflow – thousands of toxic
people lost their jobs • The disposal into the Porong River
• Infrastructure has been and the sea affects the river
damaged extensively (toll ecosystem and the aquaculture
roads, power transmission industry
systems, gas • 42 rice fields, fish and shrimp ponds
pipelines, national artery Infrastructure Environment have been destroyed
roads)
People Health
• 3,000 patients registered
• 60,000 people have been affected by gas hydrogen
forced from their home sulphide (H2S)
• 3,500 families were displaced • 81% victims suffered from lung
problems
• 200 died from poor health

7. Human Rights Case: This Is NOT a Natural Disaster
15 August 2012 – The Indonesian Commission on Human
Rights (Komnas HAM) announced that the Lapindo
mudflow in Sidoarjo was a human rights violation and PT
Lapindo Brantas was responsible for the man-made
disaster
PT Lapindo Brantas violated 15 basic rights (right to
life, safety, health, housing, employment, education, socia
l security and education) and failed to guarantee victim’s
basic rights since 2006 disaster – Police Investigation
Under Criminal Code

8. Lesson Learnt: The Sustainability Principle
Exploitative
SUSTAINABILITY
Short-term
PRACTICE
Approach

9. What Should Have They Done? – What Should They Do Next?
1. To conduct thorough research if it 1. To provide emergency
was safe enough to do the gas funding and support to the
exploration in the particular drilling victim
area 2. To supply manpower and
2. To conform drilling security expertise in efforts to find a
procedure (Did not install the casing solution
drilling) 3. To reduce the growing social
3. To conduct appropriate training impact from the expanding
session for their technical experts lake of mud
(Did not cover the drilling hole)
4. Legal permission in the middle of
dense population

10. References
1. Ade Mardiyanti (2010, February 21). Muddying The Truth: A New Documentary Looks At Sidoarjo. Retrieved August 27, 2012
from http://www.thejakartaglobe.com/arts/muddying-the-truth-a-new-documentary-looks-at-sidoarjo/359892
2. Amir Tejo (2010, October 21). Rail Safety Fears After Latest Sidoarjo Cave-in. Retrieved August 25, 2012 from
http://www.thejakartaglobe.com/home/rail-safety-fears-after-latest-sidoarjo-cave-in/402592
3. Desy Sagita (2009, May 29). Three Years of Mudflow Misery. Retrieved August 27, 2012 from
http://www.thejakartaglobe.com/home/three-years-of-mudflow-misery/278177
4. Farouk Arnaz (2010, May 30). Lapindo Mudflow Case Can Be Reopened: National Police. Retrieved August 26, 2012 from
http://www.thejakartaglobe.com/home/lapindo-mudflow-case-can-be-reopened-national-police/521071.
5. Fidelis A. Satriastanti (2010, May 28). After 4 Years of Mud, Sidoarjo Blame Question Lingers. Retrieved August 25, 2012 from
http://www.thejakartaglobe.com/indonesia/after-4-years-of-mud-sidoarjo-blame-question-lingers/377582.
6. Fidelis A. Satriastanti (2011). Walhi Contends Corruption In Indonesia Mudflow Aftermath. Retrieved August 27, 2012 from
http://www.thejakartaglobe.com/home/walhi-contends-corruption-in-indonesian-mudflow-aftermath/347729.
7. Fidelis A. Satriastanti (2010, April 15), “Great At Work” In Lapindo Mudflow Probe. Retrieved August 27, 2012 from
http://www.thejakartaglobe.com/indonesia/graft-at-work-in-lapindo-mudflow-probe/369739.
8. Fidelis A. Satriastanti (2011, May 31). Learning From Lapindo: Five Years On, What Now?. Retrieved August 26, 2012 from
http://www.thejakartaglobe.com/blogs/learning-from-lapindo-five-years-on-what-now/444204.
9. PT Lapindo Brantas Tbk (2012). Retrieved August 28, 2012 from http://en.wikipedia.org/wiki/PT_Lapindo_Brantas.
10. Sidoarjo Mudflow (2012). Retrieved August 28, 2012 from http://en.wikipedia.org/wiki/Sidoarjo_mud_flow.

11. Any questions?