Indorayon calls on govt to provide protection

JAKARTA (JP): Publicly-listed pulp and rayon producer PT Inti Indorayon Utama has called on the government to protect its operations, its workers and property while an independent auditing team begins work to decide its fate on Monday.

The company also urged the public, especially those protesting against its operations, to give the team a chance to complete its work and let the government decide on the company's fate.

"If the results of the audit prove that Indorayon's environmental and social performance is bad, Indorayon's management and employees will accept the reality and be willing to close the factory in Porsea, North Sumatra.

"However, if the results are positive, the public should magnanimously accept the verdict and allow the company to continue its operations," the company said in a statement over the weekend.

The government decided last month to assign an independent audit team to check Indorayon's mill near Lake Toba in North Sumatra following mass protests by local people who alleged the plant had damaged the environment. They demanded that the mill be closed down without waiting for the results of an independent audit.

The audit team, which is expected to complete its work within three months, will provide a recommendation to the government, but Indorayon will be given a chance to challenge the audit result.

The mill was forced to stop production in early July after local protesters blocked the main access roads to the plant.

However, the company began operating again late last month because the mill has to have been operational for five weeks before a government-appointed independent audit team can begin work.

The resumption of operations created a misunderstanding among the protesters, leading to last week's riot involving thousands of people at the mill in Porsea. The protesters damaged four cars, set 15 company trucks ablaze and vandalized and burned 23 houses and businesses. Security personnel shot at least four protesters with rubber bullets.

On Thursday, rioting spread to the nearby town of Tarutung when protesters gathered there to demand the release of 79 people detained by police during the unrest at Porsea.

The company said it was deeply concerned over recent acts of assault, arson and looting committed against its employees and property, and urged the government to take firm action against those responsible.

Company director Sudibyo Markus said in the statement: "The rioting is no longer a demonstration but an organized crime.

"We urge the authorities to investigate such criminal acts and at the same time identify the rioters, provocateurs, financiers and actors behind the trouble which has not only inflicted losses on Indorayon but has also caused innocent people to suffer."

Indorayon is 62 percent owned by the Singapore-registered Asia Pacific Resources International Holdings Ltd., which is listed on the New York Stock Exchange.

The other 38 percent of Indorayon is owned by the investing public, cooperatives and a number of shareholders from Finland.

Before suspension of its operations, Indorayon exported 70 percent of its annual production of 240,000 metric tons of hardwood pulp and 60,000 tons of rayon fiber. (rid)