Canadian mining company East Asia Minerals is “working closely” with Indonesian government officials to destroy Aceh’s forests

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The province of Aceh in Sumatra is currently drawing up its spatial plan. In the current version, an area of 1.2 million hectares of forest would be converted to mining, logging and oil palm plantations. One of the driving forces behind this proposal appears to be a Canadian mining company, East Asia Minerals.

In May 2011, East Asia Minerals announced that it was buying 50% of Carbon Conservation, the Australian company that was developing the Ulu Masen REDD project. At the time, East Asia Minerals was clear about its motivations – getting the go-ahead for its mining projects in Aceh:

“Through the acquisition of a 50% equity interest in CC, the Company will develop a ‘green’ mining project which will use carbon and biodiversity offsets and the latest in environmentally friendly mining practices.”

Around that time, the Ulu Masen project more or less ground to a halt. A REDD project run by a company 50% owned by a mining company was a step to far for Aceh’s then-governor, Irwandi Yusuf, who was nick-named the “Green Governor”.

This week, East Asia Minerals put out a press release announcing that the Ministry of Forestry is “close to accepting a proposal to open 1.2 million hectares of forest in Aceh province for mining, logging, and palm oil production”. This is, incidentally, the same Ministry of Forestry that told the UN Forum on Forests last week that the country was committed to extending the two-year moratorium on conversion of primary forests and peatlands.


UPDATE – 21 April 2013: An on-line petition has been set up, which currently has more than 18,000 signatures, asking Zaini Abdullah, the Govenor of Aceh, to reject the plan to convert 1.2 million hectares of Aceh’s forests and to review the spatial plan. Sign the petition here, or click on the image below:


Edward Rochette, CEO of East Asia Minerals, said,

“We are very pleased with the recent news from the Indonesian Government. These new developments are good progress and positive news for mineral extraction in the area. This will help us realize the full value of our Miwah gold project in Aceh with a NI 43-101 compliant resource of 3.1 million ounces of gold.”

No wonder he’s pleased. His company seems to have taken on a key role in developing Aceh’s spatial plan – what should be a government policy. In its press release, East Asia Minerals states,

The company is working closely with government officials in the country and have company representatives on the ground in Aceh to obtain reclassification of the forestry zone from “protected forest” to “production forest.”

The area of forest at stake to East Asia Mineral’s mining projects is potentially very large, as this map from a 2011 presentation by East Asia Mineral illustrates:

To promote its interests in Aceh, East Asia Minerals has hired Fadel Muhammad, former Deputy Chairman of the Golkar political party. He was also Minister for Maritime Affairs and Fisheries and before that Governor of Gorontalo Province in Sulawesi. East Asia Minerals CEO Rochette says,

“In his advisory role Bapak Dr. Fadel will provide invaluable assistance to enable the projects in Indonesia to move forward in a timely and sustainable manner. We are very pleased to have Bapak Fadel advising the Company and look forward to working with him in this new role.”

Fadel has been accused of misusing US$567,000 from the 2001 Gorontalo provincial budget. The corruption case was closed in 2010 because of a lack of evidence, but opened again in May 2012. Since being named as a suspect in 2012, Fadel has been questioned twice by the Gorontalo Prosecutor’s Office, most recently last week. Fadel maintains his innocence. “It’s an old case that is over. I’m not afraid because I was not involved in corruption during my time at Gorontalo,” he told the Jakarta Post.

As Deputy Chairman of the Golkar Party, Fadel visited Aceh in April 2012, to support the current governor Zaini Abdullah during his election campaign.

None of East Asia Mineral’s lobbying has so far had much affect on its share price. The company’s share price started to fall from around US$8 at the end of 2010, and has been worth less than US$1 since the beginning of 2012. It currently stands at US$0.15. When East Asia Minerals bought 50% of Carbon Conservation, it paid US$500,000 plus 2.5 million shares. At the time the deal was announced (May 2011), East Asia Minerals share price was US$4. So the value of the shares paid to Carbon Conservation has fallen from US$10 million down to US$375,000:

East Asia Minerals reports that Fadelmay be granted stock options of the company, in future. Which gives Fadel an incentive to line his own pockets (assuming the share price would go up if East Asia Minerals gets permission to trash Aceh’s forests) but very little incentive to listen to the views of the people of Aceh (or anywhere else for that matter). Business as usual, then.

Dedi Ratih of WALHI (Friends of The Earth Indonesia) comments,

“This spatial plan is being developed via a highly ‘unhealthy’ process, in which foreign corporations are intervening and driving local policy. Reclassification of these forests is clearly not in the best interests of Aceh’s local communities, but instead in the interests of massive natural resources exploitation. This plan should be rejected immediately.”

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11 Comments

  1. Hello Chris

    Have you had a reply yet from Sir Nicholas Stern as to whether he still thinks that REDD is the ‘quickest and easiest’ way to prevent climate change?

  2. When Are We Going To Stop Placating the Indonesian Government, with their switch and bait tactic?
    And when are we going to expose UN-REDD and RSPO for what they are – a collaborator with corporate deforestation?
    GREENING THE WORLD WITH PALM OIL? Sustainablity? Corporate Social Responsibility? http://sco.lt/6GqRd3
    @pdjmoo

  3. Please give details – petition? name of goverment member to write to. Prime minister?

  4. @mike (#3) – Thanks! There is a petition – I’ve added the details in an update to the post. (I’d linked to this petition in an earlier post here.)

    Sign the petition here, or click on the image below:

  5. Chris Lang is obviously an idiot! and know’s nothing about the real reasons behind the changes in spatial planning (he probably doesn’t care either, as long as he’s got a cause to scab money for). The change in spatial planning is predominantly to open more areas for local farming, which will benefit the local people, especially in South Aceh Kabupatan, where there is a very thin strip of land between the National Park and ocean where people can live and grow food. I know the issues, i’ve worked there, and spoken at length with the local people about what they want. Central Government and clowns like Chris Lang make the rules unfortunately. The local people are forced to log and hunt in forest because there’s nowhere for the ever increasing population to dwell. This article is written by an un-informed hypocrite! You should be ashamed of yourself.

  6. @Your An Idiot (#5) – So the government of Aceh is planning to hand over 1.2 million hectares of forest “predominantly” for local farming. Can you provide any evidence to back up this claim?

    I’m surprised to learn from your comment that I’m responsible for making the rules along with Central Government. I’m even more surprised because I’ve managed to do this without having a single meeting with anyone in government.

    I’m also surprised to learn that I’m using Aceh as a “cause to scab money for”. I wonder where the money’s gone? I certainly haven’t seen any of it.

  7. Canadian wilderness

    I think the point here is that we really need to stop the destruction of habitats
    where animals are losing their homes and lives. The human race sucks if all we do is
    destroy nature in order for a few very people to get rich. There are countries where people actually respect
    nature and are trying to conserve it and the animals in it while also helping the locals so that they become conservationists instead of stripping their own country and losing their heritage.
    It absolutely ticks me off that Canada has any connection to destruction in other parts of the world…surely a Canadian
    wouldnt sell his soul for a few bucks while destroying and killing animals. Hmmm. Wait. We still have that hideous east coast seal slaughter which truly is horrifying and an insult to the intelligence of acountry that knows it should have stopped a long time ago. Thank you to the countries who ban seal skins now. Maybe one day it will finally stop.

    Apparently we have been selling out our own country and its resources via some asian company who, once the papers are signed,means that no one will be “allowed” to stop the Asian deforestation , etc up north. Pretty sure most Canadians dont realize that once signed,some legal paper says we would be fined billions if we try to back out of the deal. All comes back to” what the hell are we thinking to sell off any of our Northern Hemisphere wherein lies what may be the last refuge to much of the wildlife and beauty Canada is known for. Honestly, we need to focus on saving our planet,not padding some rich person’s greed and pockets,and in areas where the population is struggling to survive, other ideas need to be arrived at that don’ t involve selling out Mother Nature.

  8. What business do you have dictating to the Achinese what they should do with their land. You are just an enviro-imperialist. Bug out.

  9. @Bob (#8) – The article is about a Canadian company called East Asia Minerals that is trying to influence the Acehnese government’s proposed Spatial Plan. Do you also think that East Asia Minerals should “bug out”?

  10. EAM has a vested interest in the place. Frankly, I think trying to deal with Achinese was a mistake. Just radical mohameddans.

    But you just want to keep the people in their poverty.

  11. @Bob (#10) – East Asia Minerals has an interest in gold mining in Aceh. The company is therefore trying to influence the government’s plans. First by buying up half of Carbon Conservation which was at the time running a REDD project in Aceh, then by lobbying the Acehnese government.

    Maybe it would help if you could give examples of multinational corporations that have exploited the resources of Aceh and the people of Aceh have benefited. Perhaps you could start with the oil and gas industry, and Exxon-Mobil, for example.

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