Investigative Report: PT MSK, APP's supplier, clearcuts peat forest in Kerumutan block

EoF Investigative Report / 24 June 2007

Eyes on the Forest investigation in February 2007 continued the observation in November 2006. It found this time that around 3,000 ha of natural forests had been clearcut in a Selective Logging Concession (HPH) of PT Mutiara Sabuk Khatulistiwa, by PT Arara Abadi, a subsidiary of Sinar Mas Group (SMG), associated with Asia Pulp & Paper (APP).

The conversion into acacia plantation in this concession has increased by 1,000 ha larger than that of in November 2006. This logging operation is prepared for development of a 15,000-ha Industrial Timber Plantation of PT Mutiara Sabuk Khatulistiwa.  

This EoF investigation did not find who sourced the felled timber for PT Mutiara Sabuk Khatulistiwa; however, based upon the field observation indicating the involvement of PT Arara Abadi. EoF believes that PT Indah Kiat Pulp and Paper (IKPP), a pulp mill belonging to APP, has been sourcing timber from the concession of PT Mutiara Sabuk Khatulistiwa. 

• Official data from the Ministry of Forestry in 2005 ( said that PT Mutiara Sabuk Khatulistiwa holds a Selective Logging License (HPH), not a Timber Plantation Industry (HTI/IUPHHK-HT) license.

• This HPH license is issued based on Minister of Forestry Decree Number 109/Kpts-II/2000 dated 29 December 2000. The size of the concession where logging is happening is 44,595 hectares.  

APP management through its response to EoF Investigative Report November 2006 on 11 April 2007 did not deny the involvement of the company in sourcing the timber from the questionable operations conducted by its subsidiary, PT Arara Abadi. APP said the Ministry of Forestry on 12 July 2004 has approved a forest management plan for the concession allowing two silvicultural systems which EoF considers as selective natural forest logging and natural forest clearcutting. Around 28,660 of 44,595 hectares is converted into pulpwood plantation.