Friday, 16 April 2010

Indonesian firm faces new forest clearing allegation

Indonesian firm faces new forest clearing allegation

PT Sinar Mas Argo Resources And Technology Tbk

* Sinar Mas palm oil unit accused of more forest clearing
* Greenpeace releases new satellite images
* Sinar Mas says it will investigate the claims

By Sunanda Creagh

JAKARTA, April 16 (Reuters) - Conservationist group Greenpeace released on Friday new satellite images it said linked Indonesian oil palm producer Sinar Mas to the clearing of high value rainforest, a practice the firm had vowed to stop.

Several top palm oil buyers, including Unilever (ULVR.L) and Nestle (NESN.VX) have said they will stop buying from Sinar Mas after Greenpeace released a report alleging rainforests and peatlands had been cleared to make way for its plantations.

Rainforests and peatlands trap enormous amounts of greenhouse gases and their preservation is seen as an important step in slowing climate change.

Sinar Mas, which owns Jakarta-listed PT SMART Tbk (SMAR.JK) and Singapore-listed Golden Agri-Resources (GAGR.SI) issued a statement in February promising it would not convert high conservation forests or develop plantations on peat soils.

However, Greenpeace said in a statement it had satellite images showing continued forest clearing in a concession operated PT Agro Lestari Mandiri (PT ALM), which is managed by PT SMART Tbk. The concession is in Ketapang district, West Kalimantan, on the Indonesian half of Borneo island.

"Greenpeace has new evidence from the field, showing that Sinar Mas continued to clear peatlands and orangutan habitat in its PT ALM concession, despite its commitment to stop," Greenpeace said in a statement.

Greenpeace said in the statement that a comparison of satellite images from Feb. 23 this year and Nov. 19 last year showed peatland and forest clearance had continued, and that about 2,300 hectares (5,683 acres) had been cleared by PT ALM.

PT SMART Tbk President Director Daud Dharsono said in a statement emailed to Reuters that the new allegations would be examined as part of a broader investigation by two certifiers, Control Union Certification and BSI Group.

"We would like to reaffirm that we remain committed to achieving environmentally sustainable production of palm oil," he said in the statement.

Palm oil is used in confectionary, cooking oils, soaps, cosmetics and as a biofuel for transport. Industry officials have said that demand for Indonesian palm oil remains strong, despite the Greenpeace campaign.

Agribusiness giant Cargill said in March that it would stop using Sinar Mas as a supplier if the Greenpeace allegations of improper land conversion were validated by an investigation by the Roundtable on Sustainable Palm Oil, an industry body of planters, consumers and green groups.

The Greenpeace satellite images can be found here w-evidence-sinar-mas.pdf. (Editing by Sara Webb and Alex Richardson)