Turning on the Gas.(ExxonMobil Corp. closes Aceh natural gas fields)(Statistical Data Included)

Abdullah Syafi is the most-wanted man in Indonesia. But when the supreme field commander of the Free Aceh Movement rumbles into a jungle hideout on his motorcycle, he's dressed for peace, not war. The 45- year-old Muslim rebel, who has fought for more than two decades to turn resource-rich Aceh into an independent Islamic state, has exchanged his trademark beret and battle fatigues for an electric-blue suit and button-down shirt, pale blue tie and reading glasses studded with rhinestones. An aide says the togs show off his civilian side, the one that supported a ceasefire negotiated with Jakarta last year. But underneath the clothes, Syafi's thirst for revenge seems stronger than his passion for fashion. "We have a commitment [to a ceasefire]," he tells NEWSWEEK. "But if the Indonesian Army doesn't stop the violence, we won't stop the violence."

So much for the suit. Despite the 10-month-old ceasefire and peace talks that have shown a sputtering promise, Aceh is once again a place for fighting words. On March 9 rebel threats forced American oil giant ExxonMobil to close down its vast natural-gas fields in the province. Jakarta responded by formally branding the Free Aceh Movement (known by its Indonesian acronym, GAM) as "separatists" and dispatching elite combat troops to the region. Both sides seem to welcome the conflict: the military, which has seen its role and reputation diminished by fiascoes in East Timor, Borneo and the Moluccas, is anxious to reassert its power. GAM, for its part, thrives on chaos. "We don't need a long- term strategy because Indonesia is broken," says Syafi. "When it falls apart, we will have our freedom."

That kind of rhetoric is familiar from decades of conflict in Aceh. What's different this time is the closure of the ExxonMobil fields, which produce all of the province's gas. Company representatives say they cannot calculate how much money they're losing each day. But Jakarta normally receives $100 million per month in taxes and revenues from the plant, and the shutdown has disrupted operations at the state- owned refinery that processes and ships the gas to countries like Japan and South Korea. "The government is seemingly unable to give protection to investors operating in difficult areas," says Roger Machmud, retired president of U.S. subsidiary Arco Indonesia. "This is a major problem."

For many Acehnese, the massive ExxonMobil plant near Lhokseumawe has served as an unshakable symbol of Javanese imperialism: nearly all of its production and profits leaves Aceh. Moreover, the company reportedly paid the hated Indonesian military $500,000 a month to protect its facilities. Last year GAM rebels kidnapped several company employees. They fought pitched battles with the Army guards. They even shot at a company plane as it taxied on the local airstrip, piercing its fuselage and injuring one Indonesian employee. Last week gunmen attacked a convoy of company vehicles, shattering the windows but miraculously injuring no one. "GAM really raised the stakes," says a Western analyst in Jakarta. "They said, 'Either you work with us, or you may not work at all'."

By choosing the second option, ExxonMobil has sent shock waves through the Indonesian economy. After the company evacuated 120 staff members, including 20 Americans, the Indonesian stock market fell 17 percent in two days. The sudden closure spooked foreign investors and budget analysts, who worried about the lost revenue, and prompted several other gas-related companies to halt operations as well. The shutdown, which ExxonMobil says is indefinite, will also hurt Aceh. Thousands of workers have already lost their jobs. At least one Japanese company has already decided to turn to Malaysia for its ...