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KLK pulls out of oil palm in Collingwood Bay but logging fears remain

November 30, 2016 Leave a comment

klk

Source: Gabriel Thoumi – ValueWalk

In December 2012, Kuala Lumpur Kepong Berhad (KLK) bought 51% of the equity in Collingwood Plantations Pte (CWB) via KLK Overseas Investments Limited for $8.7 million. At the time, according to AmInvesment Bank, the assumed production costs from clearing to palm oil production for the new plantation were $6,000 per ha.

In KLK’s 2013 Annual Report, the company estimated that it would develop 30,000 ha of oil palm in Collingwood Bay. The area is known for its pristine primary forests and coral reefs, containing high levels of biodiversity. Prior to KLK’s entry, the Collingwood Bay Indigenous communities had secured a court order that prohibited all natural resource related national government agencies from entering the bay without the landowners’ prior consent.

Collingwood Bay’s Indigenous communities successfully contested KLK’s plantation plans in the Papua New Guinea courts, which declared KLK’s two main leases null and void in May 2014.

In October, KLK confirmed that it has withdrawn all interest in the development of two portions of customary land (Portion 113C and 143C) in Collingwood Bay. A smaller third State Land portion – Lot 5 which is 5,992 ha – is still being reviewed, according to KLK. Without access to the other lots, however, it is uncertain if the size of Lot 5 is economically feasible to develop on its own because it also mostly covered with primary and High Carbon Stock forest.

In a statement KLK publicly committed to sell off by December 2016 its land clearing equipment stored in Wanigela, Collingwood Bay and confirmed that KLK and / or its agents will exclude the cultivation of palm oil as a development option on Lot 5.  Concerns remain, however, if the land-clearing machinery is sold to KLK Overseas Investments Limited joint venture partner ANG Agro Forest Management to facilitate logging and other activities in the primary forests of Lot 5.

KLK has not clarified its overall plans for its overall $8.7 million investment Collingwood Plantations Pte, its total land bank of 44,342 ha in the region or its 37,000 ha plantation deal in Sepik Province, Papua New Guinea. According to agronomists and a 1992 government soil survey, the Sepik Province plantation deal is on land that has been found to be unsuitable for tree crops.

Stay out of Papua New Guinea, KL Kepong told

November 2, 2014 Leave a comment

FMT Reporters

SAM and FOTO organise a protest on behalf of Collingwood Bay folk who do not want their customary land developed for oil palm.

SAM and FOTO organise a protest on behalf of Collingwood Bay folk who do not want their customary land taken for oil palm

Sahabat Alam Malaysia and Friends of the Orangutans held a protest outside the Kuala Lumpur Kepong head office in Ipoh demanding that KLK withdraw from Lot 5 in Collingwood Bay, Papua New Guinea and cease all its oil palm activities there.

The protest was made on behalf of the people of Collingwood Bay who claim that despite a court order cancelling the leases of KLK, the company continued to operate in the area with the intention to develop Lot 5.

Despite KLK claiming that Lot 5 was state land, landowner Lester Seri totally disagreed saying, “Lot 5 is within Maisin customary lands and holds primary forest and small patches of ‘kunai grass’ that the communities annually use for game hunting.”

Seri also said 80% of Lot 5 was primary forest and High Carbon Stock (HCS) forest.

Saying that communities in Collingwood Bay depended on the land as a source of income, Seri added, “there is no change, the Collingwood communities do not want oil palm and KLK in Collingwood Bay.”

KLK Bhd is among the largest plantation companies in Malaysia with approximately 250,000 ha of land bank in Malaysia and Indonesia.

In December 2012, the company along with Batu Kawan Bhd collectively acquired 69% of shares in Collingwood Plantation Pte in Singapore from a Malaysian national living in Papua New Guinea.

However on May 20, 2014, a High Court there declared two large land development leases (Lots 113C and 143C) totalling 38,350 ha belonging to KLK Bhd as null and void.

The court also ordered the state to cancel the Special Agriculture and Business Leases owned by KLK after a civil lawsuit was brought against the company by customary landowners who objected to their land being developed into oil palm plantations.

However despite the court-ordered cancellation, KLK has refused to cease its activities.