Case Study 3: Boven Digoel, PT Indo Asiana Lestari

Issues of potential concern:

• Overlapping permits • Abandoned concessions • No FPIC • Horizontal conflict within Indigenous community • Concealed beneficial ownership

Indigenous Auyu people protest at local government offices about PT Indo Asiana Lestari. Signs include a call for licence cancellation. Aug 2020. © Yayasan Pusaka Bentala Rakyat

In 2017 the same situation of overlapping permits as had occurred two years previously with the three Digoel Agri Group concessions arose over another concession that had formed part of the Tanah Merah project. On 7 July of that year Yesaya Merasi’s successor as Bupati of Boven Digoel, Benediktus Tambanop, issued a decree purporting to revoke the IUP of the northernmost (and by then abandoned) Menara Group concession, PT ESK, and on the same day issued a location permit for the same land to a new company, PT Indo Asiana Lestari (PT IAL).372 Like his predecessor two years before (see Case Study 2), he had no power to revoke the IUP, because it had been issued by another authority – Papua Province. Nevertheless, the provincial government legitimised the new location permit just over a year later, on 27 August 2018, by itself revoking PT ESK’s IUP,373 and two days later it issued in-principle approval for PT IAL to continue to apply for an IUP.374 On 18 September 2018, the provincial EIA evaluation commission approved the frame of reference for PT IAL’s EIA,375 allowing a full EIA study to be prepared.

These new approvals were issued shortly before the Oil Palm Moratorium was introduced on 19 September 2018. While the progress of PT IAL’s permitting has been delayed, evidence has emerged that the company has been aggressively pushing for local acceptance of its plantation project among the Auyu Indigenous people, violating the principle of free, prior and informed consent (FPIC) and catalysing conflict within the Indigenous community, some of whose leaders support the project.376

In 2017, after obtaining its location permit, PT IAL reportedly began approaching the community about its plans. According to reports by the Catholic Justice and Peace Secretariat of Merauke Archdiocese, a mid-October 2017 meeting of clans that hold customary rights within the concession was broken up by a group of company supporters who threatened to kill anyone who opposed the company’s plans.377

From that point on there have reportedly been sharp divisions within the Auyu community living in and around the concession. A number of clan leaders do support the company’s plans,378 but other community members strongly oppose them, and conflict reportedly extends to members of the same clan in some cases.379 While there are valid reasons to support or oppose plantations, there are indications that actions by the company are likely to have complicated or exacerbated these conflicts. Since 2018, the company has reportedly been making monthly payments of between IDR800,000 and 1,200,000 (US$55–85) to some heads of clans.380 On the other hand, opponents of the scheme appear to have been subjected to further intimidation. Greenpeace has seen a copy of a letter summoning one Indigenous man to a police station in November 2019, in connection with a complaint made by PT IAL’s director Muhammad Abbas related to land rights.

372 SK Bupati Boven Digoel 522.2/731/BUP 2017 373 SK Kepala BPMPTSP Papua 10/2018 374 SK Kepala BPMPTSP Papua 11/2018 375 SK Ketua Komisi AMDAL Papua 10/2018 376 InfoPublik (2020) 377 Yayasan Pusaka Bentala Rakyat (2017) 378 InfoPublik (2020) 379 Yayasan Pusaka Bentala Rakyat, notes of discussion held in Boven Digoel, November 2020, unpublished 380 Yayasan Pusaka Bentala Rakyat, report in preparation. See also Lubis Y (2020).

© Yayasan Pusaka Bentala Rakyat

PT Indo Asiana Lestari's field office in Boven Digoel, Papua Province. As PT IAL’s location permit expired in 2020, it was obliged to apply for an extension to that permit. According to villager accounts compiled by Yayasan Pusaka Bentala Rakyat, on 13 November 2020 about 12 Indigenous opponents of the plantation visited the office of the Boven Digoel Investment Agency to convey the reasons for their opposition. The agency head responded that he would wait for supporters and opponents of the company to reach an agreement before he issued the permit extension. The same day, Indigenous people who supported the company held a demonstration at the office, threatening to burn it down if the permit extension was not issued. Three days later, three opponents of the plantation were summoned to the local police station, purportedly for the purposes of mediation. However, due to the presence once again of a crowd of angry company supporters (some armed and/or drunk) and police officers pushing for a rapid resolution, the men felt that they had no option but to sign the letter presented to them, withdrawing their opposition.381

The Boven Digoel Investment Agency was correct to inform local Indigenous communities and seek their views before renewing the permit – this is required according to the 2015 regulation on location permits,382 although it is rare to hear of it being applied in practice. Nevertheless, this story shows the importance of paying attention to how this requirement is implemented – for the consent to be meaningful, the government must be sure that a consensus agreement was obtained without coercion or manipulation and that conflicts were resolved when necessary.

Greenpeace Indonesia has not been able to confirm whether or not the location permit was renewed. However, opponents of the plantation reportedly continued their protests in January 2021.383

381 Monitoring report by Yayasan Pusaka Bentala Rakyat (unpublished), based on interviews with Indigenous opponents of PT IAL. 382 See Minister for Agrarian Affairs and Spatial Planning (2015), Article 10. 383 Kompas.tv (2021)

Docking facilities at the site of recent land clearance in PT Indo Asiana Lestari’s concession. 2021

Worryingly, satellite images show that starting in November or December 2020 four hectares of forest was cleared within PT IAL’s concession on the banks of the Digoel River. Local people believe that it was for a new logging compound. If this new clearance is indeed by the company as a first step towards plantation development, and it still does not possess an environmental permit, IUP and timber utilisation permit, it could be breaching several laws including the Environment Law and Plantation Law.

PT IAL is owned by a Malaysian company registered in Sabah, Mandala Resources Sdn Bhd. An analysis of shared directors and office addresses used by PT IAL indicates a probable connection with the All Asia Agro group, which operates oil palm plantations in Sabah and marble quarries in Sulawesi. The sole shareholder of Mandala Resources Sdn Bhd is not on the board of All Asia Agro according to the latter’s website,384 but could theoretically be a nominee appointed by a beneficial owner to hold shares in their name, a practice which is legal in Malaysia.385

384 All Asia Agro website ‘Board of Directors’ accessed 29 January 2021 385 Azmi & Associates (nd)