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Indonesia has revoked the permits of 28 resources companies, including a subsidiary of Jardine Matheson, as part of a probe into whether their operations played a role in the deadly floods that killed more than 1,000 people late last year.
President Prabowo Subianto ordered the revocation after a government task force found the companies had violated regulations, state secretary Prasetyo Hadi said late on Tuesday.
“The task force reported to the president the results of investigations into companies suspected of violating regulations. Based on that report, the president decided to revoke the permits of 28 companies found guilty of violations,” said Prasetyo.
“The government remains committed to regulating natural resource-based businesses to ensure they comply with applicable laws and regulations.”
Twenty-two of those companies are involved in operations in natural forests and plantations over an area covering about 1mn hectares, while the remaining six are involved in mining, plantations and timber.
Commodities have been a significant source of revenue and growth for resource-rich Indonesia, the world’s largest producer of palm oil and nickel, but their development has also resulted in massive deforestation and environmental damage across the archipelago. Environmental groups have long called for projects in the biodiverse island of Sumatra to be halted.
Indonesia stepped up probes of potential violations after flooding on the island killed 1,190 people in late November. Government officials blamed mining and palm oil plantations for exacerbating the flooding and landslides and promised more action.
One of the companies to have their permits revoked, Jardines-linked Agincourt Resources, operates the Martabe gold mine in Sumatra. Agincourt is a subsidiary of Indonesian conglomerate Astra International, which is controlled by Jardines.
The gold mine has proved controversial for Jardines, one of Hong Kong’s oldest colonial-era business empires.
Environmentalists say the mining operations threaten the habitat of the world’s most endangered great ape, the Tapanuli orangutan. Norway’s sovereign fund sold its stake in Jardines in 2024, citing its links to “severe environmental damage” from the mine.
The mine, located in North Sumatra province, has been closed since early December following the flooding and investigations launched by Indonesian authorities.
Agincourt said it “respects every government decision and maintains its rights in accordance with applicable regulations” without commenting further.
Other companies to lose their permit include North Sumatra Hydro Energy, which is developing the Batangtoru hydropower plant and is controlled by China’s SDIC Power Holdings, and Toba Pulp Lestari.
North Sumatra Hydro Energy, SDIC and Toba did not immediately respond to requests for comment. Last year, Toba said it would co-operate with the government’s decision to conduct a comprehensive audit and evaluation of the company.
This month, the environment ministry initiated civil lawsuits of Rp4.8tn ($285mn) against six companies for suspicion of causing environmental damage in North Sumatra. The ministry did not identify the companies, which it alleged were responsible for destroying watershed systems.
Authorities have said criminal charges could also be filed against companies and individuals.
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