The palm oil industry has the potential to generate significant economic and social development in Indonesia. Palm oil is one of Indonesia’s most successful agricultural products and largest agricultural exports. It also provides a means of income and economic development to many of Indonesia’s rural poor. The Indonesian palm oil industry is expected to continue its rapid growth in the medium-term. However, with this opportunity comes the responsibility to address the known environmental, social, and economic challenges and risks associated with this supply chain.
As of 2018, we have planted a total of 57,157ha of palm oil plantation out of 120,955ha of ‘Right to Cultivate (HGU)’ permit. In particular, we have not obtained any license or planted oil palms on peatland, including plasma plantation. We commit to sustainable palm oil production, which includes reduction of greenhouse gases, improvement of livelihoods, and food security.
Our palm oil plantation area is located in Papua, which is very related with the local community. Wild animanls hunting is only allowed if it is done by the local community and in limited manner to fulfill needs for food or traditional ceremony. Other that that, wild animals hunting is not allowed and this is shown with a signboard.
All of our palm plantations have conducted AMDAL evaluations based on Indonesian government regulations and will apply the same principles to all future developments.
In addition, RKL/RPL reports are prepared for each corporation in accordance with AMDAL regulations and are regularly submitted to relevant government agencies. The report includes contributions to water quality, air quality, soil erosion, biodiversity management and local community, and those contents are clearly stated and managed by a professional staff.
In addition, in 2017, the SEIA evaluation was conducted by a consulting organization called BIOREF.
We endorse the Indonesia Sustainable Palm Oil (ISPO) as the primary sustainability standard for palm oil products and support the efforts of the ISPO to develop mechanisms to distinguish sustainable palm oil products. We also supported the establishment of 7 plasma cooperatives to develop palm plantations of indigenous people as one of the core ISPO programs. As of 2018, the development of plasma plantation have not yet begun because of deforestation issues in Papua. Therefore, we are trying to reach consensus through consultation with various stakeholders in order to develop plasma plantations in accordance with sustainable development method. We also have a total of 4 CPO mills (TSE A Mill, TSE B Mill, BCA Mill, DP Mill), all of which produce CPO by ISPO standards. In addition, we will continue to improve our operations to comply with the Roundtable on Sustainable Palm Oil (RSPO) standard and its implementation.
As stakeholders and international community show an increasing concern towards climate change, we are responding accordingly. We are making consistent efforts to reduce greenhouse gas emissions by reviewing to introduce renewable energy. In the future, we plan to analyze greenhouse gas emission level by using ISPO Calculator Methodology for our palm plantation to build systematic greenhouse gas management.
Our commitments to the responsible palm oil production by complying with policies of no peat, no exploitation, no burning, and no deforestation are already in effect. Until now, our CPO mills have not purchased FFB from external supplier and have used 100% of FFB production from our own plantations. We plan to continue this policy in the future.
Water remains as an essential element for the environment protection and oil palm productions. In order to ensure the sustainability of this important resource, we protect rivers by designating buffer zones around the river. We also carry out various initiatives that aim to ensure optimal water conditions, thereby creating an ideal environment for oil palm cultivation. The objective of our water system management is to prevent flood, minimize erosion, and to secure the water supply for our plantation areas during the dry season. Implementation of the our water management systems has been designed with careful consideration and comprehensive hydrology, agronomy, and topography studies, as well as environmental and social impacts. The effectiveness and impact of the water management system, including its construction phase, have been carefully analyzed and evaluated.
We are aware that protecting water quality is an important part of our lives and the protection of the environment. Therefore, we make extraordinary efforts to protect water quality.
We strive to manage the quality of water by periodically testing samples and analyzing the results at locations designated by each palm plantation. Samples are analyzed and approved by the Indonesian government and will continue to do so.
In regard to water, we are primarily focused on controlling and mitigating the impacts of chemicals and mill waste on water quality in natural waterways. POME is treated in the Company’s Waste Water Treatment Plant through Cooling Ponds, Mixing Ponds, Anaerobic Ponds, and Settling Ponds.
We also have long term plan to construct Land Application to recycle the wastewater from CPO Mill. Instead of discharging the wastewater from CPO Mill that is rich in organic substances, we plan to use it as a fertilizer at our farms through Land Application. Reusing wastewater into organic fertilizers will also help reduce the use of nitrogen fertilizer, which is known to contribute to global warming.
We recognize the problems posed by excessive use of other agrochemicals such as pesticides, fungicides and herbicides which may be washed off by the rain into nearby natural waterways. As a part of our commitment to reduce chemical usage in order to mitigate impacts on the environment, nonchemical pest control measures are preferred at all our palm oil plantations. In particular, through Integrated Pest Management Systems designed to minimize use of chemicals by relying on biological and cultural alternatives.
Integrated pest management is the practice of using a range of strategies to sustainably maintain pest populations within economic thresholds while causing minimal harm to local ecosystems. Encouraging natural predators reduces pesticide application, we managed to reduce our use of chemical pesticides. Oil palm pests include rats, rhinoceros beetles, bunch moths, bagworms, and nettle caterpillars.
We promise to offer sustainable palm oil products in support of our customer demands and will monitor the implementation process and constantly improve operations related to palm oil plantation and production.
We will adjust and follow policies in ways that are consistent with ISPO and Indonesian government regulations to protect forests, peat lands, local communities, and human rights.