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Home › Dodgy Deals ›
Dodgy Deal
PT Toba Pulp LestariIndonesia

Company – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack
Contact:

nature@banktrack.org

Last update: 2020-11-17 00:00:00
Photo: .

Company – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack
Contact:

nature@banktrack.org

Last update: 2020-11-17 00:00:00
Why this profile?
About
Sectors Pulp, Paper and Paperboard Mills
Headquarters
Ownership

Toba Pulp Lestari is a subsidiary of Pinnacle Company Limited controlled by Mr. Sukanto Tanoto, who also controls the RGE group.

Subsidiaries
Website http://www.tobapulp.com

The company was formerly known as PT Inti Indorayon Utama Tbk and changed its name to PT Toba Pulp Lestari Tbk in August 2001. It is a paper milling company founded in Sumatra, Indonesia, in 1989 by Sukanto Tanoto, one of  Indonesia's richest business men. The company built Indonesia's first pulp mill at the small village of Porsea nearby Lake Toba of North Sumatra.

The company was formerly affiliated with pulp and paper giant, Asia Pacific Resources International Limited (APRIL) and its parent Royal Golden Eagle (RGE), but is now independently listed on the Indonesian Stock Exchange in Jakarta.

The mill has caused much protests by local people, who argue that it is polluting the area, its causing major deforestation and land grabbing.

Following the downfall of Suharto in 1998, public pressure began to grow, but it was  answered with violence by police officers hired by the company. Clashes between local residents, staff and members of security forces resulted in six deaths and hundreds of injuries in 1999. As a result, President Habibie temporarily put the mill on halt on 19 March 1999.

In May 2000, the Indonesian cabinet minister gave the mill a 'green light' to resume its operations,  with the requirement that the production of dissolving pulp should be stopped. The decision was then responded by another opposition from the local people and Indonesian environmental groups such as WALHI. A student was shot dead by the police during the demonstration on 21 June 2000, and during the following months of conflict, dozens more have been killed and many hundreds were seriously injured.

Impacts

Social and human rights impacts

Batak communities living near the mill have voiced concerns over environmental damage associated with its operations, including forest degradation and the release of noxious fumes. Violent clashes between community members and security forces led President Habibie to announce the temporary closure of the mill in March 1999.

PT Toba Pulp Lestari has also been involved in a conflict with indigenous communities in the Humbang Hasundutan district since 2009, over its 200,000ha concession. The communities demand a return of 4,000ha of land they consider is traditionally theirs. The National Forestry Council (DKN) has already done field research and submitted its recommendations to exclude indigenous territories from TPL's concession to the Ministry of Forestry, but these have not yet been taken into consideration. A chronology of protests that broke ou in September 2012 can be found here. Early 2013 clashes broke out again when villagers caught TPL employees entering their forest areas and cutting down frankincense trees, on which they depend for their livelihoods. This resulted in the arrests of 31 farmers by the mobile police brigade.

Toba Pulp Lestari operates pulp mills in Sumatra, Indonesia, where their activities over many years have had serious impacts on local communities. Forest concessions were granted for industrial exploitation without the free, prior and informed consent (FPIC) of the people with legitimate claims on the land; many of these communities are dependent on the forest resources for their livelihoods. According to RAN, over 13,000 indigenous people have been displaced due to the deforestation caused by TPL. This situation has led to significant social conflict and human rights violations. With the Constitutional Court ruling "MK 35" last year, there is also a material risk that areas in concessions allocated to APRIL, TPL and their suppliers were in fact illegally appropriated from indigenous communities.


Environmental and climate impacts

APRIL and TPL holdings and suppliers are having profound negative impacts on biodiversity and the climate. Many concessions supplying the mills owned by Mr. Tanoto are in areas representing some of the last refuges for the critically endangered Sumatran elephant and Sumatran tiger, and forest clearance of these areas forces these species closer towards extinction. According to RAN,well over 17,000 ha of natural forest have been destroyed to feed the mills.

In addition, drainage of deep peat soils both for natural forest clearance and for plantation establishment is an issue of global concern due to greenhouse gas emissions: a study released by the University of Helsinki shows that APRIL's Acacia plantations on peatland in Sumatra release around 80 tonnes of carbon dioxide per hectare per year. Other concerns include the continued subsidence of peatland areas, caused by drainage, leading to longer terms risks of flooding and inundation.

Ater the release of the initial permit the quality of air and water around the Asahan River degraded drastically. This was linked to skin diseases as well as reduced corp production. There were also landslide disasters in the area. Toxic chlorine gas was released during a boiler explosion in 1993.

News
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External
Blog
BankTrack news BankTrack blog Partner news Partner blog

Global bank policies ‘dangerously inadequate’ to prevent financing of deforestation, climate chaos and human rights abuses

As the climate and biodiversity crisis intensifies, credit to forest-risk commodity companies increased 160% between 2020 and 2021.
2022-10-18 | Forests & Finance Coalition
BankTrack news BankTrack blog Partner news Partner blog

‘We Hide While Working’: The Life of Children Spraying Poison on a Pulp Plantation

2022-05-04 | Vice
BankTrack news BankTrack blog Partner news Partner blog

Walking for forests: local communities’ weeks long march to protest their land destruction

2021-08-04 | Environmental Paper Network
BankTrack news BankTrack blog Partner news Partner blog

Indonesian indigenous land defenders jailed in fight with pulpwood giant

2020-08-11 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

Activists call out 'one of the worst actors in pulp and paper'

2014-12-30 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

Inkuiri Nasional Sumatera: dari Kasus Pandumaan-Sipituhuta hingga Talang Mamak

2014-09-10 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

Toba Pulp Lestari: In depth on one of the worst actors in pulp and paper

2014-08-19 | RAN
BankTrack news BankTrack blog Partner news Partner blog

Special Report: Lake Toba indigenous people fight for their frankincense forest

2014-05-08 | Mongabay
BankTrack news BankTrack blog Partner news Partner blog

Indonesian pulp giant APRIL is bulldozing Indigenous community forests

2013-03-05 | Redd Monitor
BankTrack news BankTrack blog Partner news Partner blog

Siaran Pers AMAN: Konflik lahan dengan PT. Toba Pulp Lestari (TPL), 21 anggota komunitas adat Pandumaan dan Sipituhuta ditangkap

2013-02-26 | Jakarta | aliansi masyarakat adat nusantara
BankTrack news BankTrack blog Partner news Partner blog

Kronologis Kasus Warga Pandumaan-Sipituhuta VS TPL: Penyelesaian Sengketa Berkepanjangan, Warga Bentrok dengan TPL dan Aparat

2012-10-11 | KSPPM
BankTrack news BankTrack blog Partner news Partner blog

Indonesia: Giant eucalyptus plantation company destroys Benzoin forest gardens

2010-08-30 | World Rainforest Movement
Resources
Documents
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Videos
Links
2015-06-02 00:00:00

Royal Golden Eagle (RGE) Forestry, Fibre, Pulp & Paper Sustainability Framework

Bank policy
2015-06-02 00:00:00 | RGE
2013-01-01 00:00:00

Annual Report 2012

Annual report
2013-01-01 00:00:00

TPL

2015-01-08

SINGKAM MABARBAR - Malapetaka di Tano Batak (documentary video on TPL)

2022-05-12 11:03:14
No thumbnail available

2013 communities’ protest

2014-09-18 15:49:07

FSC Watch

Statement on RGE’s Engagement with TPL

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