RSPO Vows Probe Into Members Tied to Fires

Farouk Arnaz Jakarta Globe 26 Jun 13;

Police in Sumatra’s Riau province now have nine people in custody for setting forest fires that have blanketed the region and neighboring countries in haze, an official said on Tuesday.

Brig. Gen. Ronny F. Sompie, a spokesman for the National Police, said in Jakarta that all nine people were farmers and they had been charged with deliberately setting fires to clear their land.

Two of them were arrested on Monday, while the rest were arrested on Tuesday.

The fire hot spots, many of them raging in peat forests, have generated huge amounts of thick haze that have driven air pollution indicators to record levels in Riau and across the Malacca Strait in Singapore and Malaysia.

The annual occurrence has been so severe this time around that it has sparked a diplomatic spat, with Indonesian officials blaming local companies owned by Singaporean and Malaysian palm oil and forestry companies for the hot spots.

President Susilo Bambang Yudhoyono sought to ease tensions on Monday when he issued an apology to Singapore and Malaysia for the impact of the haze and criticized the Riau administration for not taking steps to prevent the forest fires from getting out of control.

Environmental groups have leveled much of the blame on plantations and smallholdings linked to palm oil companies, and on Tuesday the association governing the sustainable production of the commodity acknowledged that some of its members might be implicated.

Darrel Webber, the secretary general of the Roundtable on Sustainable Palm Oil, said in a statement that the organization was “critically looking into this to first of all identify the member organizations that have been indicated as implicated.”

“Secondly to instruct them to immediately deploy measures that will terminate any open burning that may have been caused by them; and thirdly, RSPO will take remedial actions against these companies if the forest fires are due to negligent conduct,” he said.

He added of the companies reported to be responsible for the fires, five were RSPO members: Jatim Jaya Perkasa, Tabung Haji Plantations, Sinar Mas, Kuala Lumpur Kepong and Sime Darby.

“The RSPO will be directing these member companies to submit digital maps of their plantations in Sumatra and Kalimantan within the next 48 hours, which will be used to assess and analyze against the published mapping of the forest fires,” Webber said.

“The analysis will assist in confirming the locations of the forest fires in comparison with the location of plantations owned by these member companies, which will then form the basis for the next step in the investigation,” he added.

He said that if the RSPO determined the companies were responsible for the fires, it would not hesitate to take action. However, he also said “other regulatory enforcements must immediately and urgently step in” to address the problem.

The RSPO, he went on, “firmly condemns any negligent activities related to this” and “is highly concerned about the impact on communities and children living in these countries and strongly advocates urgent measures to be taken to cease this heightening pollution.”

The RSPO members linked to the fires have reiterated they abide by the association’s guidelines on environmental stewardship and sustainability.

Tan Sri Dato’ Mohd Bakke Salleh, the president and group chief executive of Malaysia’s Sime Darby, said the company “fully supports the initiative by the RSPO.”

“I would like to reiterate Sime Darby’s commitment and full compliance of the zero burning policy, which is strictly embedded in all our oil palm plantation operations,” he said.

A Sime Darby spokesperson said on Monday that the company’s zero burning policy had been in place since 1985.

Sin Chuan Eng, head of sustainability at Kuala Lumpur Kepong, said the company would arrange to submit the digital maps of its plantations to the RSPO and would cooperate fully in the investigation.

Gapki Says Don’t Blame Its Members for Fires
Tito Summa Siahaan Jakarta Globe 26 Jun 13;

A log lies in a field burnt off by forest fires in Plintingan, Riau Province, Indonesia, on Tuesday, June 25, 2013. Indonesia is sending more than 3,000 soldiers, marines and air force officers to fight forest fires in Sumatra that have been blamed for heavy haze over neighboring Malaysia and Singapore. (Bloomberg Photo/Dimas Ardian)

A log lies in a field burnt off by forest fires in Plintingan, Riau Province, Indonesia, on Tuesday, June 25, 2013. Indonesia is sending more than 3,000 soldiers, marines and air force officers to fight forest fires in Sumatra that have been blamed for heavy haze over neighboring Malaysia and Singapore. (Bloomberg Photo/Dimas Ardian)

The Indonesian Palm Oil Association believes that its members are not to be blamed for the string of forest fires in Sumatra’s Riau province that attracted international attention.

Joko Supriyono, the secretary general of the group known as Gapki, believes that the government’s information on the various hot spots in the province is inaccurate.

“The government must validate the information by going straight to the location. Even a zinc roof was identified as a hot spot [by satellite imaging],” he said on Tuesday.

“This haze incident cornered the palm industry further. Without the incident we are already under attack,” Joko said, accusing some parties of exploiting the situation to further disrupt Indonesia’s palm oil industry.

Joko claimed that he checked Gapki’s members in Riau and found that most of the wildfires occurred beyond their concession areas.

“There are four of our members suspected of causing fires. Three of them said that the incident was outside their area and one said it was occurred inside a plot owned by a small-holder,” he added.

Gapki’s members, consisting mostly of large plantation firms, would never resort to a slash-and-burn technique for land clearance as they fear being criminalized for their activities, Joko said.

“Furthermore, there have been no expansions of palm oil plantation in the province,” he claimed.

Joko also highlighted that many of the Gapki members joined the Roundtable of Sustainable Palm Oil (RSPO).

Still, Joko admitted that slash-and-burn was the cheapest method for land clearance and small-holders may be tempted to use it due to lack of knowledge and resources.

“Mechanical land clearance would be too expensive for them,” he added.

Joko also reminded that during the dry season fire can be ignited very easily and spread very quickly.

“A simple cigarette butt could trigger wildfires,” he said.

The government recently identified 10 companies with fires on their land on Friday, including Jakarta-based Sinar Mas Agro Resources and Technology (Smart) and Asia Pacific Resources International (April).

Gapki has 600 large-scale plantation firms that cover 3 million hectares of the total 9 million hectares of palm oil plantations across the country.

Sime Darby, KLK units among firms blamed for fires
Alvin Foo Straits Times 26 Jun 13;

THREE firms accused of starting fires that led to the haze crisis are units of some of Malaysia's largest public companies, while another is linked to a fund that helps Malaysian Muslims save for pilgrimages.

Indonesia last week pinpointed eight firms as being responsible for setting fires to clear land.

Two of the slash-and-burn suspects are units of Sime Darby Plantation, which is part of Sime Darby, a conglomerate with a market value of RM56.7 billion (S$22.5 billion) and 100,000 staff in more than 20 countries.

Another company being investigated is a subsidiary of Kuala Lumpur Kepong (KLK), a giant company with plantation, resource-based manufacturing and property interests. It has a market value of RM22.5 billion.

A fourth, PT Multi Gambut Industri, is a subsidiary of Malaysia's Lembaga Tabung Haji, the pilgrimage fund board that runs a scheme helping Malaysian Muslims save for their pilgrimage to Mecca.

CIMB regional economist Song Seng Wun said: "Sime Darby and KLK are very large Malaysian companies with a long history. Sime Darby is seen as a government-linked company, while KLK is a family-controlled Chinese business."

Sime Darby Plantation is one of the world's largest palm oil producers, accounting for 2.44 million tonnes, or about 5 per cent of global crude palm oil output yearly.

It has plantations in Malaysia, Liberia and Indonesia's Kalimantan, Sumatra and Sulawesi. In Singapore, the Sime Darby brand is known through Sime Darby Motors, which distributes BMW cars.

The conglomerate, whose roots go back to the 19th century, also has interests in industrial equipment, energy and utilities, and health care.

Similarly, KLK started as a plantation company over a century ago. It has a land bank of over 250,000ha across Malaysia and Indonesia's Belitung Island, Sumatra, and central and east Kalimantan.

KLK's chief executive is Malaysian tycoon Lee Oi Hian, who has been named with his brother Lee Hau Hian as one of Malaysia's 40 richest by Forbes, with a combined net worth of US$1.1 billion (S$1.2 billion).

The group has now diversified into property development. It also owned retailer of bath and body products Crabtree & Evelyn, which was sold last year for US$155 million.

Both Sime Darby Plantation and KLK have denied involvement in the fires, adding that they have strict no-burning policies.

Sime Darby Plantation said its units operate in areas where there are local communities and smallholders occupying parts of the concession area linked to the haze, and they are unable to control activities in areas occupied by others.

KLK said on Monday that the purported concession area under PT Adei Plantation is mainly planted with mature palms, with no land-clearing for new plantings.

PT Multi Gambut Industri is now known as PT TH Indo Plantations. Its parent, the Lembaga Tabung Haji, said it is not involved in any open burning activities.

Aside from Sime Darby's PT Bhumireksa Nusa Sejati and PT Tunggal Mitra Plantation, and KLK's PT Adei Plantation, the others named are PT Langgam Inti Hibrindo, PT Udaya Loh Dinawi, PT Jatim Jaya Perkasa, and PT Mustika Agro Lestari.

On Monday, the Association of Plantation Investors of Malaysia in Indonesia said Malaysian firms are not involved in clearing Indonesian land using fire. Its executive secretary, Mr Nor Hazlan Abdul Mutalib, told Bernama: "Plantation owners have to set aside 20 per cent of land to nurture smallholders in oil palm planting. It is a common practice for the smallholders to clear the land by fire."

Additional reporting by Chia Yan Min

Wilmar, Golden Agri admit links

TWO of the world's biggest palm oil companies - Wilmar International and Golden Agri-Resources - have admitted that they do business with some of the eight named companies being investigated for starting haze-related fires in Indonesia.

Both Singapore-listed companies said they are in the midst of reviewing these dealings.

The eight firms are among the 14 being investigated so far by Indonesia for the fires.

Wilmar, the world's largest palm oil processor, said it conducts business "with some of these companies as they have assured (it) that they have a no-burn policy". It is checking with these firms to ascertain their involvement.

A Wilmar spokesman said: "However, should they be found to be involved in burning to clear land for cultivation, we will stop doing business with them."

A Golden Agri spokesman said: "We have some transactions with a few of the named companies, and the management is in the process of reviewing these."

ALVIN FOO

Haze update: 5 firms ordered to submit maps in RSPO probe
Dionne Thompson, Assistant Foreign Editor Straits Times 25 Jun 13;

THE Roundtable on Sustainable Palm Oil (RSPO), an international organisation that monitors and promotes sustainable farming of palm oil, is launching investigations into five of its members in the wake of the forest fires in Indonesia.

It is asking PT Jatim Jaya Perkasa, Sinar Mas, Tabung Haji Plantations, Kuala Lumpur Kepong and Sime Darby to submit digital maps of their plantations in Kalimantan and Sumatra within the next 48 hours for its investigation, it said in a statement released late on Monday.

RSPO will compare these maps against the published mapping of the forest fires by the American Nasa (National Aeronautics and Space Administration) and Noaa (National Oceanic and Atmospheric Administration) as part of its investigation.

"If the investigations confirm negligent conduct – the RSPO will not hesitate to take action," it said.

Several RSPO member companies say they support the move by RSPO to clear the air.

"Sime Darby Berhad fully supports the initiative by RSPO. I would like to reiterate Sime Darby's commitment and full compliance of the zero burning policy, which is strictly embedded in all our oil palm plantation operations," said Sime Darby president and group chief executive Mohd Bakke Salleh.

"We will be making arrangements to submit the digital maps of our plantations to RSPO and shall give the RSPO fullest cooperation during the process of the proposed investigations," said Kuala Lumpur Kepung head of sustainability Sin Chuan Eng.

RSPO members are not allowed to resort to open burning and have standard operating procedures to manage fire risks.

"The environmental pollution caused by forest fires in Indonesia that has enveloped several countries in South East Asia to such hazardous levels is deplorable," said RSPO secretary general Darrel Webber.

"The RSPO firmly condemns any negligent activities related to this. The RSPO is highly concerned about the impact on communities and children living in these countries and strongly advocates urgent measures to be taken to cease this heightening pollution."