IndoMet project, coal mining in East and Central Kalimantan, Indonesia

Started by BHP Billiton and known as the "worst of worst coal projects", it threatens local indigenous peoples and Borneo's mega-diverse forest ecosystems.


Description

For centuries, the indigenous Dayak peoples of Indonesian Borneo lived from the abundant forests and rivers that blanketed the region. Recently, BHP Billiton planned to build a series of massive coal mines that would destroy primary rainforest, deprive indigenous peoples of their customary land, and pollute water sources relied on by up to 1 million people. Then in 2016 BHP Billiton sold part of the project to the Indonesian Adaro company. This coal would be for steel making, and for thermal power plants for electricity. [1] Indonesia’s National Energy Policy (Kebijakan Energi Nasional) anticipates coal comprising 30% of the country’s energy mix by 2025 [1]. Plans are afoot for 35,000 MW of new power stations in the country by 2019, including at least 20,000 MW from coal power alone. Coal deposits are concentrated in Kalimantan’s forested interior, areas inhabited by indigenous Dayak communities. [1]. The formalization of property regimes under Dutch colonial rule extinguished local claims to resources, and concentrated authority for licensing mineral extraction within a centralized state.

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Basic Data
NameIndoMet project, coal mining in East and Central Kalimantan, Indonesia
CountryIndonesia
ProvinceEast and Central Kalimantan
Accuracy of LocationMEDIUM regional level
Source of Conflict
Type of Conflict (1st level)Mineral Ores and Building Materials Extraction
Type of Conflict (2nd level)Establishment of reserves/national parks
Deforestation
Land acquisition conflicts
Coal extraction and processing
Specific CommoditiesLand
Electricity
Coal
Project Details and Actors
Project DetailsThe IndoMet Coal Project, which was initially referred to by BHP Billiton as the Maruwai coal project, covers five potential coal deposits in East and Central Kalimantan in Indonesia. In 2016 a part of it was sold to Adaro. The concessions contain more than 1.2 billion tonnes of metallurgical and thermal coal that would be shipped to Asian markets. [5]. Later is was reported [6] that BHP Billiton agreed to sell its coal assets in Indonesia to its partner, Adaro Energy. BHP did not disclose the price for its 75 percent stake in IndoMet Coal. Adaro, however, Indonesia’s second largest thermal coal producer, said in a statement the deal was worth $120 million and would “become effective upon the fulfilment of requirements in the share sale agreement, including necessary approvals from the Government of the Republic of Indonesia.” The amount is well below the $335 million Adaro paid for a 25 percent stake in IndoMet in 2010. [6]

In 2014 the government withdrew support for the construction of a railway that would transport coal from the remote mine sites to port.[3]. Also in 2014 it was reported [4] that villagers in remote Central Kalimantan lodged a claim for legal title to 1,000 hectares of land within BHP Billiton’s vast IndoMet coal project area under a new land rights scheme in the province. The residents of Maruwei, one of the closest villages to IndoMet’s “first stage” Haju mine, have mapped the boundaries of the 1,000-hectare area in question using GPS and computerized mapping systems, and submitted detailed documentation of the claim to the Central Kalimantan government.

Maruwei’s headman described the process of preparing the claim as a “race” to preserve this section of the community’s customary land, which is used for cultivating rice, rubber and crops. “When BHP comes, it will be a restricted area,” headman Suwanto tells the Jakarta Globe, through an interpreter. “So we have to race against BHP to claim this land under the Dayak Misik scheme.”[4]. Dayak Misik, introduced by the Central Kalimantan government in 2014, is a program that aims to recognize the customary land rights of the province’s indigenous Dayak inhabitants by delivering title for 10 hectares of land to every village for communal use and five hectares to each household. “The mapping exercise has created a stronger political pressure on the national government to recognize customary lands and customary rights to land,” says Nanang Indra Kurniawan, a lecturer at the School of Politics and Government at Yogyakarta’s Gadjah Mada University, who is researching the Central Kalimantan government’s customary land rights programs. “This pressure has been increasing following the Constitutional Court decision on customary forests in 2013.”

The IndoMet project, a joint venture between Australian miner BHP Billiton and Indonesia’s Adaro Energy, covers 350,000 hectares of coal-mining concessions across Central and East Kalimantan, which are estimated to contain more than 1.25 billion metric tons of thermal and coking coal. The project is expected to open up a new frontier in coal mining inside the internationally agreed Heart of Borneo conservation zone if the construction of the railway goes ahead. Activists delivered a petition containing 9,000 signatures to BHP Billiton headquarters in both Melbourne and London, calling on the company to withdraw from the project.[4]
Project Area (in hectares)350,000
Level of Investment (in USD)160,000,000
Type of PopulationRural
Potential Affected Population10,000
Start Date2006
Company Names or State EnterprisesPT Alam Tri Abadi (Adaro) (Adaro) from Indonesia
BHP Billiton (BHP) from Australia
Relevant government actorsGovernment of Indonesia, Indonesia’s National Energy Policy (Kebijakan Energi Nasional)
Environmental justice organisations and other supportersForum Koordinasi Kelompok Tani Dayak Misik Se-Kalimantan Tengah (FKKTDM-KT)

WALHI (Indonesian Forum for the Environment/Friends of the Earth Indonesia).

Global Justice Now.

London Mining Network.

WWF
The Conflict and the Mobilization
Intensity of Conflict (at highest level)LOW (some local organising)
When did the mobilization beginPREVENTIVE resistance (precautionary phase)
Groups MobilizingIndigenous groups or traditional communities
International ejos
Local ejos
Dayak Misik people
Forms of MobilizationCreation of alternative reports/knowledge
Public campaigns
Land rights mapping
Impacts
Environmental ImpactsVisible: Biodiversity loss (wildlife, agro-diversity), Deforestation and loss of vegetation cover
Potential: Fires, Global warming, Other Environmental impacts
OtherPopulations of orangutans and other threated species. These forests form a significant part of Borneo's mega-diverse and world-renowned forest ecosystems.
Health ImpactsPotential: Malnutrition
Socio-economic ImpactsVisible: Increase in Corruption/Co-optation of different actors, Displacement, Loss of livelihood, Loss of traditional knowledge/practices/cultures, Violations of human rights, Land dispossession
Outcome
Project StatusProposed (exploration phase)
Pathways for conflict outcome / responseCorruption
Criminalization of activists
Project temporarily suspended
Do you consider this as a success?Not Sure
Why? Explain briefly.BH Billiton started the project, then sold a large share to Adaro. Permission to build a railway for export has been denied. Protests by local people against land grabbing. Support against the project by conservationist organizations.
Sources and Materials
References

[1] Benjamin Brown, Samuel J. Spiegel. 2017. Resisting coal: Hydrocarbon politics and assemblages of protest in the UK

and Indonesia. Geoforum
[click to view]

World Development Movement. 2013. Banking while Borneo burns: How the UK financial sector is bankrolling Indonesia’s fossil fuel boom.
[click to view]

Links

Resentment Lingers in Village 'Tricked' Out of Its Land. June 14, 2015. Yakarta Globe.
[click to view]

[5] IndoMet Coal Project, 2016
[click to view]

February,_2010. Deadly Coal. Coal_Extraction_&_Borneo_Dark_Generation. Jakarta:_JATAM,_2010
[click to view]

[6] Reuters, June 7, 2016, BHP Billiton sells Indonesian coal assets to Adaro
[click to view]

[2]IndoMet Coal Project. This article is part of the Coal Issues portal on SourceWatch, a project of CoalSwarm and the Center for Media and Democracy. The IndoMet Coal Project (ICP) (which was initially referred to by BHP Billiton as the Maruwai coal project), covers five potential coal deposits in East and Central Kalimantan in Indonesia.
[click to view]

[3]‘Worst of Worst’ Coal Project in Kalimantan in Doubt After Snub. Jenny Denton, 24th December 2014, Jakarta Globe
[click to view]

[4]Kalimantan Villagers Lodge Land Claim Against BHP Billiton Coal Project, Jakarta Globe
[click to view]

Media Links

BHP Billiton petition hand-in against an Indonesian coal mine. Global Justice Now. On 26 May 2015, Global Justice Now handed in a petition to the London office of BHP Billiton containing over 9,000 signatures against the IndoMet coal mine on Borneo in Indonesia.
[click to view]

Banking while Borneo burns: top five banks fuelling climate change. 1 oct. 2013. Global Justice Now
[click to view]

2015, Business and Human Rights, Indonesia: Kalimantan villagers file customary land rights claim for area within BHP Billiton's IndoMet coal mine; BHP responds
[click to view]

Other Documents

Source: http://www.sourcewatch.org/index.php/IndoMet_Coal_Project The dispersed nature of the coal deposits in Kalimantan.
[click to view]

Source: Global Justice Now and London Mining Network International campaing against Indonesia coal mine.
[click to view]

[click to view]

Meta Information
ContributorSM (ICTA-UAB)
Last update30/10/2017
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