Govt to compensate mining companies with concessions in preserved forests

The government will compensate mining companies that have invested in their mining concessions inside preserved forests as stipulated in Law No.41/1999 on forestry, according to the head of the research and development agency at the Ministry of Energy and Mineral Resources, Surna Tjahja Djajadiningrat.

Surna said that his office had reached an agreement with the Ministry of Forestry to pay compensations to mining companies that were required to halt their mining activities inside preserved forests.

"The compensation will soon be paid by the government. But the amount will be reviewed case by case," Surna said, adding that the funding for compensation would be included in the draft government regulation on forestry.

Besides compensation, the government will likely allow mining companies to continue their mining activities if their concessions areas turned out to have been deforested like those in Bukit Suharto and its surrounding areas in Kalimantan. Although the areas have been declared under the forestry law as preserved forests, the fact shows that the areas have long been deforested.

"Therefore, we have to be fair in understanding what preserved forests are. For that reason, we are also considering that "of allowing mining companies to continue their mining activities)," he said.

Surna noted that currently there were around 150 mining companies that could not continue mining activities in their concession areas because they were declared as preserved forests under the forestry law. Their concession areas reach millions of hectares in total.

He said that most of those mining companies had entered into exploration stage in their mining concessions, but some others had not even started their activities.

The implementation of Law No. 41/1999 on forestry sparked protests from mining companies that had secured licenses to mine for minerals in their concessions that were later on declared as preserved forests.

Those mining companies then demanded the government to give explanation on the future of their mining concessions as many of them have invested some money in their concessions. (*)