Ministry seals off palm oil concession in Leuser Ecosystem linked to supply chain of top biofuel producers

(foresthints.news) - Indonesia's Ministry of the Environment and Forestry has sealed off the palm oil concession belonging to PT ABN because the company lacked the necessary permit to carry out its land-clearing operations. This sealing off was executed by the ministry on Wednesday (Jun 22).

An investigation by the ministry into whether the permit held by PT ABN for its land-clearing operations was valid began last Wednesday (Jun 15). The instruction to carry out the investigation, as well as take any necessary legal action, came directly from the Environment and Forestry Minister, Dr Siti Nurbaya.

After carefully studying the results of the investigation and consulting with the minister, the Director General of Law Enforcement at the ministry, Rasio Ridho Sani, instructed his team to seal off the PT ABN palm oil concession located in East Aceh regency on Tuesday (Jun 21).

“The sealing off of concessions is done to discipline all palm oil plantation operations, especially those of palm oil companies whose concessions are located in the Leuser Ecosystem. The sealing off of concessions represents a legal instrument for protecting the Leuser Ecosystem,” the Environment and Forestry Minister told foresthints.news on Wednesday late afternoon in Jakarta (Jun 22), after the PT ABN concession had been sealed off.

The sealing off of the PT ABN palm oil concession was done at three locations and witnessed in person by the General Manager of PT ABN. Meanwhile, the ministry's law enforcement team for the Sumatra region was accompanied by officials from the Environment and Forestry Ministry's Aceh office during the sealing off process. There was also a team from Greenomics Indonesia present at the locations where the sealing off took place.

A palm oil concession located within the Leuser Ecosystem belonging to PT ABN is seen being sealed off (Jun 22) as a result of the company being found to have engaged in land-clearing without the necessary permit (N 04°33'34.56" N - E 97°40'32.91").

A team from foresthints.news was also on location - in the palm oil concession which serves as a habitat for the Sumatran Elephant - to cover the sealing off process live. Since early June, foresthints.news has provided special coverage from the Leuser Ecosystem.

Examining the biofuel supply chain

The minister stressed that the law enforcement action underway would also include an investigation into supply chains, bearing in mind that the land-clearing operations conducted by PT ABN were linked to illegal operations.

Minister Siti asserted that the Indonesian government, as a buyer of biofuel purchased through a number of suppliers, would certainly have to look into any strong indications of illegal operations taking place in the supply chain of the biofuel supplied to it in the context of meeting Indonesia’s mandatory biofuel target, which has been fixed at 20 percent this year.

“If any of the biofuel suppliers bound by contracts to participate in the fulfillment of Indonesia’s mandatory biofuel target are found to be linked at the supply chain level to this PT ABN case, this will of course be cause for deeper investigation. The supply chain involved in meeting Indonesia’s mandatory biofuel target may in no way be associated with any kind of illegal operation. This is a serious problem.”

Land-clearing operations being undertaken by PT ABN without a permit in the Leuser Ecosystem (N 04°33'51.83" - E 97°40'34.97") .

As previously reported, PT ABN is one of the suppliers to mills which in turn supply CPO to Wilmar International and the Musim Mas Group. Both of these Indonesia Palm Oil Pledge (IPOP) signatories are suppliers bound by contracts to contribute to the meeting of Indonesia’s mandatory biofuel target this year.

Prior to the concession being sealed off, the Environment and Forestry Minister sent a radiogram, dated 14 June 2016, to the Governor of Aceh requesting that he shut down all land-clearing operations being carried out by palm oil companies whose concessions are spread across the Leuser Ecosystem.

The radiogram was a reaction to the fact that land-clearing operations for the purpose of expanding palm oil plantations were still being carried out even after, and despite, the joint declaration of a moratorium on palm oil and mining expansion in the Leuser Ecosystem, which was announced on 19 April 2016.

Two days after the sending of the radiogram, on 16 June, the minister and the Aceh governor met to discuss follow-up measures to the joint declaration and also spoke about the substance of the radiogram itself.

Subsequently, on 17 June, the Head of the Aceh Forestry Office issued a circular letter addressed to all holders of HGU (Land Cultivation Rights) permits/plantation permits within the Leuser Ecosystem demanding that they stop all land-clearing operations.

Meanwhile, the Deputy Governor of Aceh, on 19 June, declared that he was giving his full backing to the circular letter and expressed his hope that the instructions outlined in the letter could be effectively implemented on the ground level.

Five days prior to the joint declaration of a moratorium on palm oil and mining expansion in the Leuser Ecosystem, on 14 April, President Joko Widodo made an announcement calling for a such a nationwide moratorium to be imposed.

As such, the joint declaration by the Environment and Forestry Minister and the Acehnese leaders constituted a concrete initiative acting on the President's directive. The support of these parties is of great benefit given that the Leuser Ecosystem is considered one of the world’s most irreplaceable protected areas according to the International Union for Conservation of Nature (IUCN).