28 June 2013 - In an effort to address proactively the current issue with the haze from fires in Riau Province in Sumatra, Indonesia, and its causes, PT Minamas Gemilang calls on all other stakeholders to enter into constructive dialogue to find a sustainable solution to the problem.

PT Minamas, a subsidiary of Sime Darby Plantation, is one of the largest players in the Indonesian palm oil industry with operations in the Riau Province.

“It is time for all stakeholders to work together to find a way to address what has become an annual problem of the haze, and the tremendous toll it takes on the environment and the health of affected communities on both sides of the Straits of Malacca,” said Sime Darby Plantation Managing Director, Datuk Franki Anthony Dass. “On our part, PT Minamas would be happy to assist and participate in any constructive discussion on this matter. Local communities, civil society groups, academics and other companies operating in affected areas should offer technical assistance and support to the Government of Indonesia to study the issues and address the root causes of the problem,” Dass added. Among the issues that would need to be addressed include:

• the responsibilities of different stakeholders
• how various stakeholder groups can work together to prevent future occurrences
• legal issues pertaining to land use and occupation
• best agricultural management practices

In the last few weeks, fires in the Riau Province have resulted in a hazardous smog blanketing Singapore, parts of Malaysia and southern Thailand. Indonesian authorities have long sought a solution to this annual problem. Between 11 June and 19 June, five hot spots were found on land within the concession area of PT Bhumireksa Nusa Sejati (PT BNS), a company owned by PT Minamas. However, examination of satellite data and on ground assessment teams established that these fires were not in areas planted by the company. (The result of the on-ground assessment or berita acara is attached as Appendix 1). Local communities in these areas plant a variety of cash crops such as corn and sugar cane. Under current regulations and conventions dealing with local communities and the preservation of traditional farming methods, concession holders are unable to control or influence the practices and activities of these communities.

“PT Minamas has conducted awareness programmes on the negative impact of slash and burn activities on local communities in the peat areas. It intends to intensify this awareness programme together with other plantation companies and local authorities,” Dass said.

Sime Darby Plantation, the world’s largest producer of certified sustainable palm oil, has had a zero burning policy since 1985. In Indonesia, 20 of the company’s 25 mills under PT Minamas have been certified by the Roundtable on Sustainable Palm Oil (RSPO). The RSPO is a voluntary certification body, whose members include civil society groups and players along the entire palm oil value chain.

“There are several companies within the palm oil industry who observe high agricultural standards. As an industry, we could contribute significantly to discussions on how to solve this problem,” Dass said.

For its part, Sime Darby Plantation and PT Minamas would bring to the table, more than 100 years of expertise in best agricultural practices backed by cutting edge R&D capabilities, experience in establishing responsible and successful outgrowers’ schemes and experience in the management of land, on both peat and non-peat soil.

Sime Darby Plantation has studied two other areas, one where the company is managing an area cultivated on peat land by local communities under the plasma, or outgrowers’ scheme, and another where it had acquired a plantation established on peat soil (attached as Appendix 2). In the first area in Jambi, South Sumatra, local farmers, under the plasma scheme, plant oil palm but are exposed to and educated in the company’s best agricultural policies.

In the other area in Lavang, Sarawak, Malaysia, Sime Darby Plantation manages a small estate in which no fires have been recorded since the inception of planting in the mid 1990s as a result of efficient water table management, encouraging beneficial vegetation to protect the soil and strict adherence to the company’s policies.

“Out in Riau, our officials and fire fighting teams are already assisting the local authorities and communities to spot and put out fires,” Dass said. “However, for the longer term, sustainable solutions that do not undermine the rights of local communities and traditional farming methods need to be found. For this to be effective, we need multi-stakeholder discussions.”

In 2008, Sime Darby Plantation implemented a strict policy prohibiting the clearing of peat areas. Existing areas that were cleared before the implementation of policy are carefully managed to ensure that there is minimal environmental impact.