House may approve new mining policy for protected forests

The Jakarta Post, Jakarta

The House of Representatives may approve the government's plan to allow mining companies to operate in protected forests, according to legislators.

Priyo Budi Santoso, a legislator on House Commission VIII for mining and energy, said on Wednesday that the House had set up a special team to decide which mining firms could resume operations.

He said that although the government had proposed 50 mining companies, the House might approve fewer than that.

"The House will not approve all of them. Some will be approved, and some will be rejected," he said.

Minister of Mineral Resources and Energy Purnomo Yusgiantoro said on Tuesday that the government had agreed to let 50 mining companies continue operation in protected forests.

The mining companies were forced to stop their operations in 1999 after the government issued Law No. 41/1999 on forestry, which bans open-pit mining in protected forests.

The law raised concerns among mining investors as it was implemented after many had conducted expensive explorations in areas that were later designated as protected forests. Reports said that some 150 companies had been affected by the ruling.

Meanwhile, legislator Husni Thamrin said that the House special team would soon meet with the government to evaluate which of the 50 mining firms were eligible for the new plan.

He said the team would set up a criteria to decide which firms could resume their operations in protected forests.

"The criteria are still being discussed, but environmental, social and economic concerns will be taken into account," he said.

He pointed out as an example that mining firms that could prove they had huge mining deposits in their respective areas would likely be given approval to resume operation.

Husni dismissed an earlier report in this newspaper saying that Purnomo would propose that the forestry law be amended, saying such a move was unnecessary because the law had an escape clause stating that the firms could resume operation in protected forests as long as they had obtained a special permit from the House.

He said that another way was to change the status of the mining areas from a protected forest to a productive forest.

Separately, Mahendra Siregar, an expert staff member at the Office of the Coordinating Minister for the Economy, said that the primary reason for allowing mining firms to resume operation in protected forests was to encourage economic growth, particularly in eastern Indonesia where most of the sites of the 50 mining firms are located.

He explained that economic development in the eastern part of Indonesia for now could be accelerated via investment in the mining sector as investment activities in other sectors could not be expected in the near future due to a lack of infrastructure and qualified manpower in the region.

He said that the second reason was to honor mining contracts issued to the mining companies, most of which belong to multinational firms.

"The contracts were signed before 1999, and should be honored to create a good investment climate in Indonesia," he said.

The Ministry of Forestry had long opposed reviving the mining contracts in protected forests, although Purnomo claimed on Tuesday that the ministry had now agreed to the plan.

But the move will surely draw protest from environmental groups, which have long argued that allowing open-pit mining activities in protected forests would endanger wildlife and indigenous tribes in the areas.