Press Release re Wilmar

DEFORESTATION WITHOUT BREAKING ZERO-DEFORESTATION POLICY
Biodiversity hotspot in East Kalimantan threatened by Wilmar

BALIKPAPAN, 27 February 2014.

Public meeting, held by Wilmar in Hotel Tiga Mustika in Balikpapan, incidentally drew attention to inconsistencies in Wilmar’s commitment to zero-deforestation, which has been agreed on 5th December 2013. A proposal to destroy one of the last remaining biodiversity hotspots along the East Kalimantan coast has been revealed on the meeting, as Wilmar advocated for their proposal to locate a crude palm oil refinery by PT Wilmar Nabati Indonesia (WINA) in Balikpapan Bay. Wilmar is trying to deny the high conservation value of the land under their concession.

The concession of PT WINA in Balikpapan Bay covers 149.8 ha of forest. Since 2008, numerous NGOs, researchers and environmental activists have opposed Wilmar’s project to locate a palm oil refinery in this area. The HCV Forest assessment, conducted recently by Wilmar’s contractor, PT Re.Mark Asia, was reaction to these protests. It however proves to be only an awkward attempt by Wilmar to conduct deforestation without formally breaking the zero-deforestation policy.

The report is based more on paperwork rather than field data and makes provision for Wilmar’s needs rather than for objective criteria of HCV Forest assessment. In result, the report denies the high conservation value for most of the concession. Only 22.73 ha are considered to be a HCV Forest, which is a significant underestimate. The real extent of the HCV Forest is in fact close to the total area of the concession (149.8 ha). This represents almost 87% underestimate of the total extent of the HCV area.

One of the apparent limitations of the HCV Forest Assessment by PT Re.Mark Asia is the lack of field data (only 4-5 days of field work) and the extensive use of unreliable and highly questionable secondary resources. For example, data from previous Environmental Impact Assessments (AMDAL, UKL/UPL) have been used, regardless of the fact that these data are well known to be highly inaccurate and often purposely manipulated.

The report significantly underestimates the total extent of forest with high concentration of biodiversity values, and fails altogether to give the appropriate status to the area that represents extensive natural environments, endangered and interconnected ecosystems, forests critical to erosion and sedimentation control and forests fundamental to meeting basic needs of local communities.

The report diametrically misinterprets the status of the mangrove forest within the PT WINA concession.  It considers 86% of the mangrove forest to having been changed into scrubland and shrimp farms, while in fact, 100% of the mangroves were in reasonably good condition before Wilmar took over the concession. It also entirely denies the existence and high conservation value of extensive secondary forest, by classifying it a scrubland as well.  In fact however, these forests are home to numerous endangered species, including one of the world’s biggest populations of proboscis monkeys. It is one of the most important biodiversity hotspots that still remain along the coast of East Kalimantan.

Furthermore, the HCV Forest assessment denies the crucial environmental services of the forest within Wilmar’s concession, such as preventing erosion and sedimentation in Balikpapan Bay. The report fails to acknowledge that Balikpapan Bay represents a relatively closed water system, with limited and slow water exchange with open sea of the Makassar Strait. This means that the sediment and industrial waste is not washed into open sea and instead accumulates in Balikpapan Bay. This may result in extremely heavy sedimentation, which is causing death of ecosystems such as coral reefs and sea grass beds (the key feeding areas for dugongs).

Furthermore, decreased light penetration due to heavy sediment load restrains overall productivity of the ecosystem. This in turns leads to serious threats to the population of marine mammals, the collapse of local fishery and increased poverty in coastal villages, where 80 % of the inhabitants are fishermen. Traditional fishery is the major and most vital economic activity within this ecosystem. Together with ecotourism (and possibly carbon trading), it represents truly sustainable economic activity in Balikpapan Bay. Ecosystem destruction due to land clearing, deforestation and coastal reclamation, increasing underwater noise and industrial pollution, is causing serious damage to the local fishery.

Exposing this environmental case highlights a serious loophole in Wilmar’s new zero-deforestation policy. The policy, in theory, does not allow any further conversion of the High Conservation Forest, either by Wilmar or by its subsidiaries, either for palm oil plantations, palm oil mills or crude palm oil refineries. This commendable decision raised a lot of positive response from environmental NGOs and helps Wilmar to develop good image and to secure valuable business contracts.

However, the case of Balikpapan Bay shows that simply by assessing an area as not-having high conservation value, Wilmar can still continue in deforestation without formally breaking the zero-deforestation policy. Such loophole would enable Wilmar to proceed in conversion of any forest by claiming that it is not a HCV area. Such zero-deforestation policy would be meaningless. 

However, we believe that if Wilmar is serious with their zero-deforestation policy, this can only be proved by the unconditional halting of any further development in Balikpapan Bay.

Balikpapan Bay represents an important test, which will show to the international community how serious Wilmar is with the new zero-deforestation policy.

Contact:
Stan Lhota, M.Sc., Ph.D
(Czech University of Life Sciences in Prague)