The Mining Advocacy Network (JATAM) on Thursday, March 30, 2023, has officially sent letters to two important institutions related to investment, capital markets and finance, namely the Financial Services Authority (OJK) and the Indonesia Stock Exchange (IDX). This is related to the planned Initial Public Offering (IPO) by PT Trimegah Bangun Persada, a nickel mining company owned by Harita Group operating in Kawasi, Obi Island, South Halmahera, North Maluku, Indonesia.
There are several reasons for JATAM’s urgency in sending the letters. As stated in the letter, JATAM highlighted 10 main points as follows. Firstly, the IPO of PT Trimega Bangun Persada’s shares took place amid widespread environmental damage and suffering of residents in Kawasi, South Halmahera, North Maluku.
The operations of PT Trimegah Bagun Persada, along with PT Gane Sentosa Permai, PT Halmahera Persada Lygend, PT Megah Surya Pertiwi, and PT Halmahera Jaya Ferronickel on Obi Island—which are all under the Harita Group, have devastated local people’s land/plantation, polluted water sources, river, and sea, polluted the air due to dust and pollution that affected residents’ health, to trigger social conflicts due to intimidation and repeated violence against residents who defend their living spaces.
Unilateral land grabbing was also carried out by PT Trimegah Bangun Persada, along with a number of other companies owned by Harita Group, without fair negotiation and compensation. This was experienced by Lili Mangundap and four land-owning families in Kawasi. Forced compensation was carried out only based on the Decree (SK) of the Regent of South Halmahera No. 117 of 2017 regulating prices for guava plants with the following details: per one fruiting guava tree, it is valued IDR 75.000 and IDR 35.000 for those without fruit, and small ones or saplings for IDR 6.000. Anything outside these types of plant it is considered not economically valuable.
All water sources of Kawasi residents have been polluted, due to sedimentation of nickel ore from the company’s operations. The residents, who before the mine existed could get water for free, now have to spend money to get clean water. For those who are economically deprived, are forced to remain dependent on polluted water sources.
It is also confirmed that there has been pollution of marine space where fishermen fish in Kawasi, Obi Island. Waste that is discharged into rivers and flows into the sea causes the coast and sea to turn cloudy-brownish. Sewage pipes from the company’s activities lead to the sea, causing ecosystems and fish to be polluted with heavy metals.
Referring to a research conducted by Muhammad Aris in the journal “Heavy Metal (Ni, Fe) Concentration in Water and Histopathological of Marine Fish, in the Obi Island, Indonesia” (2020) 12, heavy metal pollution in the waters of Obi Island accumulates in the physiology of fishes. Metals that contaminate ocean waters can be eaten by plankton, then plankton eaten by small fish and large fish.
Next thing is the coal-fired power plant, which supports the operations of PT Trimegah Bangun Persada and a number of other companies under the Harita Group, has also polluted the air and caused the health of residents to be disrupted. The distance is so close to the settlement, that dust, noise, and dirty environment become problems for the residents. In summer, kitchen utensils, dining tables, chairs, floors, and even in the room are full of dust from the company activities and coal dust.
Residents claim that almost every day there are children and adults who are taken to health facilities whose medical equipment is incomplete. Officials at Polindes Kawasi admitted that acute respiratory infections (ARI) are the most important health problem in Kawasi. Most patients are toddlers. There were 124 infants aged 0-1 years who visited Polindes from January to December 2021. Toddlers aged 1-5 years were recorded at the number of 283, followed by the age group of 20-44 years as many as 179 people.
Departing from all the facts above, it is known that the operations of PT Trimegah Bangun Persada, as well as all Harita Group companies in Kawasi so far, do not comply with the principles of Environment, Social, and Governance (ESG). Instead, all of these ESG principles are undermined, as are the company’s operations that openly deprive Kawasi citizens of their rights and a healthy and sustainable environment.
If the IPO plan of PT Trimegah Bangun Persada’s shares is to continue, the company must issue a written statement publicly, both to take responsibility for all environmental and humanitarian crimes that have been committed, as well as to ensure that the ecological infrastructure of the island and coastal waters is not damaged, especially in relation to the planned disposal of liquid waste in the forest area of Obi Island.
Thus, various entities that are prospective buyers of shares as well as those who have agreed to buy, before making transactions have known that the investment of fresh funds they risk cannot be included in the category of ethical investment.
The considerations are clear and simple. PT Trimegah Bangun Persada’s investment promises a gigantic revenue influx, but the entire production process takes place in the field of mining operations and processing of battery materials with a scale of damage that is absolutely impossible to recover. The continuation of the IPO process will directly trigger the acceleration of the prospect of deteriorating environmental conditions and the fate of island dwellers, both on the mainland and waters of Obi Island, as well as throughout the Halmahera sea waters which are unlikely to be completely free from open-pit mining waste pollution and HPAL processes.
In the end, JATAM also reminded that the Financial Services Authority and the Indonesia Stock Exchange as the regulator of financial transactions and the highest capital and financial market operator in Indonesia should participate. They must be responsible for generating ecological damage from PT Trimegah Bangun Persada’s investment on Obi Island and its waters, along with the risk of cost overruns of mitigation costs, if it is possible to do so.
Contact person:
- Melky Nahar (JATAM National Coordinator), 081319789181
- Muh. Jamil (Head of Legal Division of JATAM), 082156470477