Strategic Environmental Assessment (SEA) for Indonesian Master Plan for Accelerated Economic Development (MP3EI) Scoping Report Economic Corridor

Ministry Of Foreign Affairs Of Denmark Scoping Report

May 2014

This report has been prepared under the DHI Business Management System certified by DNV to comply with Occupational Health and Quality Management Environmental Management Safety Management ISO 9001 ISO 14001 OHSAS 18001

SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Strategic Environmental Assessment (SEA) for Indonesian Master Plan for Accelerated Economic Development (MP3EI) Scoping Report Kalimantan Economic Corridor

Prepared for Ministry Of Foreign Affairs Of Denmark Represented by Mr Peter Oksen

Project manager Joshua Jon van Berkel

Project number 61800814 Prepared by Michal Musil; Yesaya Hardyanto Approval date Revision Classification Open/Restricted/Confidential

DHI Water & Environment (S) Pte Ltd• 1 Cleantech Loop • #03-05 CleanTech One • Singapore• 637141 Telephone: +65 67776330 • Telefax: +65 67773537 • [email protected]•

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SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

CONTENTS

1 Introduction ...... 1 1.1 Scoping Methodology and Analysis ...... 2 1.2 Identifying Strategic Social and Environmental Impacts ...... 2

2 Internal Scoping ...... 4 2.1 Methodology and Analysis ...... 4 2.2 General Overview of Scoping Findings ...... 5 2.2.1 Areas of Concern: , & City Broader Area ...... 8 2.2.2 Area of Concern: Kotabaru, Tanah Laut and Tanah Bumbu ...... 10 2.2.3 Area of Concern: Peat land Areas in ...... 12 2.2.4 Area of Concern: (, Kuburaya, Landak, Sanggau, ) ...... 14 2.2.5 Area of Concern: Broader Area ...... 16 2.2.6 Others ...... 18 2.3 Summary of Scoped Issues for Further Analysis ...... 19 2.4 Preliminary Recommendations ...... 20 2.4.1 Agroindustry ...... 20 2.4.2 Mining ...... 20 2.4.3 Heavy Industry / Connectivity – Power Generation ...... 20 2.4.4 Connectivity ...... 21 2.4.5 Social Issues ...... 21

3 Stakeholder/Public Consultation ...... 22 3.1 Organisation and Methodology ...... 22 3.1.1 Stakeholder Mapping and Workshop Attendees ...... 22 3.1.2 Objective and Approach ...... 22 3.1.3 Overview of Proceeding Results ...... 23 3.2 Summary and Resolution of Key Feedbacks ...... 25 3.3 Relevance for Scoped Issues ...... 26

4 Priorities for Further Analysis ...... 28

5 List of Reference ...... 30

FIGURES

Figure 1.1 Position of Scoping Analysis in Overall SEA Project Programme ...... 1 Figure 1.2 Schematic illustrations of the definition of Strategic Environmental Issues ...... 3 Figure 2.1 Map showing key baseline of forest and conservation areas in Kalimantan ...... 6 Figure 2.2 Map showing mining and oil palm concessions in Kalimantan ...... 7 Figure 2.3 Map showing area of strategic environmental impact around Samarinda, Balikpapan and Bontang city ...... 10 Figure 2.4 Map showing strategic environmental impact around Kotabaru, Tanah Laut and ...... 12 Figure 2.5 Map showing strategic environmental impact around peat areas in Central Kalimantan ...... 14 Figure 2.6 Map showing strategic environmental impacts around West Kalimantan ...... 16 Figure 2.7 Map showing strategic environmental impact around Pontianak broader area ...... 18

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TABLES

Table 2.1 Sustainability receptors used in scoping study ...... 4 Table 2.2 Issues for further SEA analysis related to corresponding areas of Kalimantan EC ...... 19 Table 3.1 Agenda for Kalimantan EC Stakeholder Consultation ...... 24 Table 3.2 Key concerns & responses from Stakeholder consultation session in Kalimantan EC ...... 25 Table 4.1 Summary table of EC strategic issues for further analysis ...... 28

APPENDICES

A Baseline Data Sources

A.1 National Data

A.2 Kalimantan EC Data

B MP3EI Planning Information in Kalimantan Economic Corridor

B.1 List of Economic Development Projects

B.2 List of Main Planned Infrastructure Projects

B.3 List of KPI and its Allocation for Economic Activities C Scoping Matrix

C.1 Mining (Including Oil & Gas Drilling)

C.2 Heavy Industry (Steel, Copper, Bauxite, Mangan – processing & smelting, and Oil & Gas processing)

C.3 Agro-forestry (Palm Oil, Timber)

C.4 Connectivity – Infrastructure (including Energy generation)

C.5 Others (Tourism, Fertilizers, Food Estates)

D Stakeholder Consultation Meeting

D.1 List of Attendees at Stakeholder Consultation

D.2 Copies of Attendance of Scoping Workshop/Stakeholder Consultation

D.3 Minutes Meeting of Stakeholder Consultation

D.4 Activity Photos

ii SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Introduction

1 Introduction

The Scoping Phase of the Economic Corridor Indonesian Master Plan for Accelerated Economic Development (MP3EI) Strategic Environmental Assessment (SEA) applied a combination of internal MP3EI SEA Team Scoping exercises and Stakeholders´ Consultations to identify related strategic social and environmental issues and risks to generate preliminary recommendations on mitigating or avoiding likely adverse effects of the Economic Corridor (EC) plans´ implementation. These findings will then be used to provide interim feedback to MP3EI planners and policy-makers as well as the basis for the next stage of the EC SEAs; namely the further analyses of likely impacts in order to verify strategic issues and risks.

This report outlines the results of this analysis and the associated consultative steps taken for the execution of the Kalimantan Economic Corridor (EC) MP3EI SEA. In doing this, this report outlines:

• The methodologies used to undertake the internal scoping and stakeholder consultation

• The results of the internal scoping process in terms of both preliminary findings and summarised issues in ‘Areas of Concern’

• A number of preliminary recommendation to mitigate likely adverse effects of expected EC development plans and policies

• Stakeholder Consultation feedback, both in terms of responses overview and summarised conclusions results

• A finalised list of strategic MP3EI related environmental and social issues and risks in the Kalimantan Economic Corridor that require further analysis and which present a basis for the analysis of likely impacts.

Figure 1.1 Position of Scoping Analysis in Overall SEA Project Programme

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1.1 Scoping Methodology and Analysis

Although there are a wide selection and many variations of scoping approaches and methods, the scoping approach designed for MP3EI EC SEAs aimed to combine comprehensive preparatory data collection and mapping, with the appropriate mix of Delphi analyses (i.e. internal scoping) and stakeholder consultation. The aim of this approach was to define the scope of further assessment in a credible way and thereby ensure that the SEA efficiently focuses on the most relevant social and environmental aspects.

The Kalimantan Economic Corridor scoping procedure consists of a two-stage process:

1. The first stage (see Section 2), consisted of an internal scoping workshop utilising project team experts in relevant fields to identify the key likely strategic social and environmental issues and their locations within the economic corridor.

2. The second stage (see Section 3) was a stakeholder consultation meeting held in Grand Kemang Hotel, on 18-19 March 2014 consisting of governmental officials / experts, academics, NGOs and others. This event allowed for dissemination of the internal scoping preliminary results and additional expert feedback to verify scoping results and/or to highlight any data gaps or new insights from a more local perspective.

The findings from both these stages were then integrated to produce this report and the finalised list of Strategic issues in need of further analysis.

1.2 Identifying Strategic Social and Environmental Impacts

Strategic environmental impacts are simply those that can only be adequately addressed at the Planning, Policy or Programme (PPP) stage. This means that SEA should not address impacts which can be effectively analysed at the project level (through EIA / AMDAL or relevant permitting procedures).

The Policy Level

In relation to the MP3EI Policy, a strategic issue or risk is where a stated development policy or planning direction clearly deviates from established socio-economic and environmental standards set out as;

• Legislation, regulations or policies • Goals and objectives, and/ or • International commitments or treaties.

Indonesia’s commitment and treaties relevant to this SEA and which are used as indications of expected social and environmental achievement are discussed in full in the MP3EI Policy SEA (Preliminary Report), which was in draft form at the time of writing this report.

The Economic Corridor Level

Underpinning the analysis and understanding of Strategic issues at the Policy Level, the MP3EI SEA process defines strategic issues at EC planning level as per the following attributes / definitions (see also Figure 1.2)

Cumulative Impacts Cumulative impacts occur when likely effects (i.e. whether compliant or not) from developments accumulate with each other and/or with already existing environmental stressors. For example, if an industrial zone is established beside existing and future areas zoned for residential use, there

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Introduction

is a potential for combined environmental emissions (e.g. air and water pollution) to exceed environmental quality standards related to health and ecological resources. Proper positioning of these zones and control of industrial zoning (e.g. type of industries, cleaner production) can prevent this before it occurs. The likely cumulative impacts are of the special importance for SEA, since given their nature, these cannot be properly and effectively addressed at the project level.

Interactive Impacts Interactive impacts arise when MP3EI initiatives show the potential to conflict with the intention of another planning aspect or sensitive baseline feature; for example, the intention of a highway that passes through a conservation area. This is an interactive conflict where the related intention can be better addressed at the planning stage rather than via Project design (i.e. that can sometimes be ineffective and unacceptable).

Scale of Impact The scale of impact plays a role when a planning element(s) shows evidence of potential international or regional significance, (e.g. large scale flooding or water pollution). Here, the scale of impact is considered strategic because its broader implications cannot be adequately dealt with through a more limited EIA / AMDAL process.

Figure 1.2 Schematic illustrations of the definition of Strategic Environmental Issues

These definitions are commonly used when identifying environmental and social issues in spatially related planning processes, and they will also allow SEA experts, i.e. in subsequent phases of the Kalimantan EC SEA, to carry out further explanation of the identified issues in relation to the SEA Article 16 principles under Law No 32/2009 concerning Environmental Protection and Management, as noted below:

• Environmental carrying and assimilation capacity • Environmental impact and risk • Ecosystem service performance • Efficiency of natural resources utilization • Vulnerability and adaptive capacity to climate change • Biodiversity potential and resilience

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2 Internal Scoping

The methodology used to carry out internal scoping, along with explanation of the related results and recommendations are outlined in the subsequent subsections.

2.1 Methodology and Analysis

Internal scoping was carried out in three general steps outlined below.

Data Collection The collection and collation of spatially related EC planning information and relevant baseline trend data was considered essential to ensure an acceptable level of scoping analysis. For the Kalimantan EC SEA, and all other Economic Corridors SEAs, mainly secondary data sources and provincial planning data were collected through a ‘Pre-scoping Stage (see Pre-Scoping Report in MP3EI website: http://klhs-mp3ei.bappenas.go.id/document) and approximately 70 Indonesia-wide spatial data sets were sourced through both government and private agencies (see Appendix A for a list of contributing agencies).

Both MP3EI Planning data and collected spatial sets were compiled within an ArcGIS database, i.e. which is also presented in a semi-public1 web-based map browser (http://klhs- mp3ei.bappenas.go.id/map), in order to allow for overlay and extrapolative techniques during scoping.

Expert ‘Delphi’ Scoping The composite GIS maps were used to overlay the current baseline features (e.g. conservation areas and mangroves, and other levels of planning) with the future MP3EI economic activities and connectivity projects proposed for a given EC; thereby allowing expert identification of locations of likely environmental and social issues or risks.

This was carried out over an intensive 1-day Delphi workshop session where dedicated EC team members and specialist experts in relevant disciplines applied the available data (i.e. including trend data) with GIS map-overlay / extrapolation techniques and specifically designed scoping matrices to carry out scoping.

A dedicated scoping matrix was assigned to each MP3EI Economic Sector (e.g. Mining, Oil and Gas, Heavy Industry, Agroforestry, Connectivity), and the related projects and spatial strategies (e.g. KPIs and Nodes) in the EC were systematically analysed in relation to sustainability receptors categories; namely physiochemical, ecosystems and socio-economic (including human health). Each of these receptors categories were then further broken down to examine impacts on different aspects of each receptor as shown in Table 2.1

Table 2.1 Sustainability receptors used in scoping study

Physio-chemical Ecosystem Socio-economic • Water • Forest and others • Human Health • Air • Biodiversity • Livelihood/Economic • Land & soil • Coastal areas • Cultural

With the guidance of a scoping facilitator, the scoping team filled in the matrices to identify specific strategic risks in relation to the established definitions (see Section 2, and Appendix C for the internal scoping matrices) and, among other details, to preliminary determine locations where these strategic impacts are likely to occur.

1 There is limited access to the public as some of the data has been deemed confidential

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Internal Scoping

The criteria outlined in the Section were then applied to the spatial datasets to identify ‘Areas of Concern’ where the likely impacts are deemed to be sufficiently significant as to be of strategic importance.

Identifying Areas of Concern & Preliminary Recommendations Internal scoping included follow-up works after the actual Delphi sessions to ‘tidy up’ scoping matrices and, due to the magnitude of scoping results, to summarise the findings into more ‘consumable areas of concern’ (i.e. in terms of communication and analysis).

These ‘Areas of Concern’ were typically identified in relation to:

• Particularly sensitive baseline features i.e. ecological habitat and/or socio-economics conditions (customary lands or important urban areas).

• Concentrations of, or interconnection between (e.g. located in one watershed), MP3EI development priorities and/or projects and/or existing unfavourable baseline features, which indicate likely cumulative impacts to multiple environmental and/or social receptors (e.g. coastal waters) in a particular area.

• Risk of likely large scale and/or interactive impacts related to the MP3EI implementation

It is noteworthy that scoping and ‘Areas of Concern’ analysis considered the entire magnitude of MP3EI planning. Thus, not only specific EC projects were considered, but also the likelihood of developments associated with development priorities (for specific Economic Sectors), “Nodes” and “KPIs”.

In order to provide input to policy makers, planners and for stakeholder feedback; preliminary recommendations for the most obvious issues were also developed. The recommendations elaborate guidelines for further economic development and project implementation as well as suggest the issues to be addressed within the provincial planning or at the policy level.

2.2 General Overview of Scoping Findings

Kalimantan Economic Corridor consists of 5 provinces, which are (7 regencies/kabupaten, 3 cities/kota), (11 regencies, 2 cities), Central Kalimantan (13 regencies, 1 city), West Kalimantan (12 regencies, 2 cities) and newly established province, North Kalimantan (4 regencies, 1 city).

Key baseline information on water quality indicated water pollution (e.g agriculture and mining activities) in several river systems: Mahakam river, , Kahayan river and Martapura river, whose condition vary from “lightly polluted“ to “heavily polluted“ (KLH, 2007). Mercury contamination on river water also occurred due to artisanal gold mining activities, in particular of West Kalimantan and Central Kalimantan. Deterioration of coastal water quality in Kalimantan is particularly pronounced in East Kalimantan (e.g. Balikpapan and Tarakan), where concentration of human activities such as agriculture, fishery (shrimp ponds) and industrialization. On air quality, urban areas such Pontianak and Palangkaraya are reported to have high lead concentrations with SO2 concentration mostly occurred in settlement areas (KLH, 2009). Urban air quality in general has been contaminated by emissions from industrial activities and traffic. Presence of forest fires in Central Kalimantan is of particular characteristic as it has affected the air quality into unacceptable levels. Virgin land (peat and forests) conversion into oil palm plantation (monoculture plantation) and agriculture has also contributed to the increased greenhouse gas (GHG) emissions and land degradation (i.e. risks of peat subsidence and soil erosion). Plantation areas are widespread in the region but particularly pronounced in West Kalimantan (Meittenen et al, 2012).

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The region is covered with large remaining intact forest area (partially protected) totalling 41 million ha, and ranking as the second largest in the country (Ministry of Forestry, 2009), with more than 52.7% of the areas has been utilized for timber production. Increasing economic activities (e.g. oil palm plantation and agriculture) have contributed to massive deforestation in the region. Forest cover loss due to forest area granted for oil palm concession totalling in 4.7% over the decade (2000-2010). Illegal logging practices are also present in the region particularly by the local people who depended on the forest resources. Other than protected forests areas, Kalimantan forests are home to important flag species (e.g. , Gibbons) and other important species (e.g. Rhinocheros Hornbill, Proboscis Monkey, Asian Elephant and Clouded Leopard, etc). A number of National Parks are located extensively in the region, with the famous National Park Betung Kerihun, and Sebangau, the latter two are home to Borneo . In addition, a number of wildlife conservation areas are also widespread in South, East and Central Kalimantan. Many biodiversity hotspots, especially the last remaining areas of lowland and coastal tropical rainforest, remain unprotected and are currently under serious threats of deforestation.

With a population of approximately 14 million (around 5.8% of Indonesian total) and a territory of almost 548,005 km2 (28.5% of Indonesian total), province of Central Kalimantan reaching lowest density of as low as 13 inhabitants per km2. Despite the remaining large forests, the region also constitutes of extensive mining and oil palm concessions, which represent the main economic activities. Regional disparity can be seen from the provincial distribution of GRDP whereas East Kalimantan produces more than two third (2/3) of Kalimantan GRDP, exactly 71.40%, which reflects concentration of main productive capacities of extracting industry (oil and gas, minerals mining, as well as palm-oil processing). The unemployment rate reaches its regional maximum in South Kalimantan, where the population growth (fuelled also by immigration) is not followed by equally rapid growth in job opportunities. Major local livelihoods are dominated by agriculture sectors and are partly concentrated on high-skills migrant employment in mining and oil & gas sectors. Of particular importance, are a number of customary lands and indigenous population present in this region, particularly in West and Central part of Kalimantan. A general overview of the key baseline features in Kalimantan EC can be viewed in Figure 2.1.

Figure 2.1 Map showing key baseline of forest and conservation areas in Kalimantan

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Internal Scoping

Figure 2.2 Map showing mining and oil palm concessions in Kalimantan

Main MP3EI economic activities designated in this area consist of mining, oil & gas, heavy industries (i.e. coal and bauxite processing), palm oil, timber and food-agriculture, all envisaged in the nodes of economic activities, zones for investment (KPI) and associated MP3EI individual projects. Connectivity infrastructure planning in this EC include power generations and transportation infrastructure (i.e. roads, railways, ports) to support the economic activities planned in the area. List of MP3EI planning in the EC is provided in Appendix B.

Reviewing the baseline features and MP3EI economic development in the EC, the internal scoping identified a number of strategic environmental and social impacts including, but not limited to the following:

• Cumulative impacts on water and air pollution from mining, oil and gas, industries (coal, bauxite processing) and power generations

• Land degradation and peat subsidence risks due to peatland conversion for oil palm plantation and other economic activities

• Further deforestation due to possible virgin land (forest and peat) for mining and oil palm plantation activities

• Interactive impact on protected areas leading to habitat fragmentation and biodiversity loss (flag species) due to infrastructure development (e.g. roads, ports)

• Coastal ecosystem degradation (i.e. mangrove and coral loss) due to increased coastal development (ports, settlements) driven by MP3EI

• Public health risks related to cumulative impacts on air, water and human food (namely seafood) from MP3EI economic activities (i.e. mining, industries, power plants)

• Impact on economic opportunity and livelihood (e.g. loss of local livelihood) driven by MP3EI economic development

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• Pressures on public infrastructure capacities (water and waste management) from increased urban growth driven by MP3EI

• Social conflict over customary lands due to MP3EI oil palm and mining activities

Specific areas of concerns are also identified for each of the potential strategic issues generated from internal scoping (Appendix C) and summarized into specified area of concern based on concentrations of MP3EI development priorities and risks of likely large scale and/or interactive conflict as mentioned in section 2.1.

2.2.1 Areas of Concern: Samarinda, Balikpapan & Bontang City Broader Area

Baseline Information A region comprising three major cities located in the coastal area of East Kalimantan is characterized with high concentration of population and economic activities, including coal mining, offshore gas and oil drilling, and heavy industries. It can be regarded as one of the traditional sectors of development in Kalimantan. In rural areas the agriculture activities (both small and medium farms and industrial-scale plantations) are key factors in defining the land- use pattern. Remaining intact forests in the area are under pressure due to intensive logging and conversion into oil palm plantation, industrial timber plantations and coal mines. The largest remaining fragment of primary rainforest (Sungai Wain Protection Forest) is under immediate threat due to the proposed extension of Kariangau Industrial Area in Balikpapan. Several other conservation areas exist in the region, namely Kutai national park (under pressure from expanding economic activities), Muara Kaman Sedulang nature reserve and Bukit Suharto forest park. There are three major biodiversity hotspots along the shore between Balikpapan and Samarinda, which still remain unprotected. Balikpapan Bay is the most diverse ecosystem within the area of concern. It includes primary rainforests, primary mangroves, coral reefs and extremely high diversity of mammalian and bird species. Mahakam delta includes the most extensive mangrove forests within the area, although they are mostly severely degraded or facing increasing pressure from expanding aquaculture and affected by sedimentation. However even the degraded mangroves still host rich bird communities, especially during the migration season. Bontang Bay and the surrounding coasts represent an extremely important area for conservation of marine mammals, and include the best preserved coral reefs within the area. Another critically important area, which remain unprotected, are the Mahakam Lakes, which represent the most extensive freshwater habitat in Kalimantan and host a rich diversity of animal and bird species, including the only population of freshwater dolphins in Indonesia.

Water quality data indicates heavy pollution (TSS concentration exceeds the standard) in the Mahakam river system, mostly due to the upstream pollution in Kaman, Siran and Belayan watersheds. Increasing economic activities (industry, mining) in the region also contribute to the low river water quality (SLHE, 2011). Air quality measurements in urbanized areas such as Balikpapan, Samarinda and Bontang show high emissions from existing industries and traffic. Public infrastructure for waste management is often poor and its capacity is not adequate to cope with increasing volumes of wastes both from growing population and economic activities (e.g. oil & gas, industries, agriculture). Existing coal mining concessions cover a large territory and mining operations expansion can be an important factor of any future development scenario. A coastal development including port infrastructure, human settlement area expansion and intensive marine transportation are the current trends that are also likely to continue in the future.

Area Planning MP3EI economic activities designated in this area are dominated by oil and gas, coal and timber development nodes. These sectors are also represented by the specific projects identified within the MP3EI EC documents. In addition, infrastructure development projects such as ports, energy generation and transmission infrastructures and transport network constructions are envisaged.

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Internal Scoping

Environmental Risks and Concerns

Physiochemical Aspects Considering the development of future mining (i.e. mining concessions) and processing in the area, a further increase of (air & water) pollution can be expected. Future MP3EI-related mining activities can cause physical disturbance altering surface and underground water flows (watershed wide) as a result of territorial expansion of mining areas. Waste water discharge from new MP3EI investments in processing industries is likely to contribute to the worsening of existing pollution problem. With regard to the MP3EI ports development in the area, potential secondary impact to coastal water quality should also be considered, though this can be managed at EIA-stage. MP3EI processing industries will also increase GHG emissions and pose additional burden to already low air quality in urban area such as Balikpapan city. When taken together with other activities such as existing power generation and likely future traffic congestions, the impacts will be cumulative.

Ecosystems Future economic activities represented by coal and timber production nodes within the MP3EI, combined with concentrated investment in the KPIs are likely to reinforce existing deforestation driven, among other activities, by the palm oil production. If significant parts of existing mining concessions within the remaining forest area are utilized, it can lead to wide scale forest fragmentation. In addition, the planned MP3EI toll road from Balikpapan to Samarinda is likely to conflict with protected areas as it is proposed to cut through the area of Bukit Suharto Forest Park. The proposed extension of the road toward Balang Island also represents a major threat to the fragile ecosystem of Balikpapan Bay. Planned roads can also increase access to formerly inaccessible areas and increase opportunity or likelihood of illegal logging and poaching. Remaining intact forests in Kutai Timur and Kutai Kartanegara regency are particularly vulnerable in this regard. A number of new ports and upgrading of existing harbor capacities can exacerbate coastal ecosystem degradation in Mahakam delta area, Balikpapan Bay and Bontang Bay. Combined with the industrial development along the coast driven by the MP3EI implementation, the impact can be cumulative.

Socio-economic As urban air and water quality are likely to be affected by MP3EI economic activities (e.g. mining, heavy industries, oil & gas) and also considering the effects of the envisaged developments on the coastal area, there is a strong likelihood of secondary impact to public health due to worsening of urban air and water quality. Deterioration of water quality in Mahakam delta in particular, will put extra pressure on the existing economic activities (e.g. aquaculture development) and thus endanger livelihood of the local population. Balikpapan Bay and Mahakam Lakes support numerous fishing communities. Pollution, sedimentation and coastal/riverside forest destruction resulting from proposed industrial development, oil palm plantations and coal mining are likely to increase poverty in these local communities due to loss of livelihood. Toxins contained in the seafood due to the pollution from industries, mines and plantations are likely to impact the health of the human population, which largely depends on seafood as the source of protein. MP3EI development has a strong potential to induce further urbanization and incoming migration of workforce to the area. The influx of migrant workers can potentially increase risks of transmissible diseases contraction for the local population. Social problems related to potential high rates of immigration (i.e. change of local social and cultural structure, loss of employment for local people) can also be expected. Considering the future urban area expansion driven by MP3EI development in the area, there is a potential for land-use conflicts (conversion of the existing agriculture land). The potential urban expansion will also put pressures on the existing public infrastructures (e.g. water and waste management) that will exceed their normal capacity, if no additional infrastructure capacity is provided.

Illustration of the potential cumulative impacts in the affected areas can be viewed in below Figure 2.3

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Figure 2.3 Map showing area of strategic environmental impact around Samarinda, Balikpapan and Bontang city

2.2.2 Area of Concern: Kotabaru, Tanah Laut and Tanah Bumbu Regency

Baseline information The character of the area is influenced by the existence of an important industrial bases including mining, metallurgy and energy generation, developed through utilization of the large coal reserves. Coal mining concessions comprise a significant part of the area. Other economic activities relevant to this area, in particular of , include agriculture, forestry (timber) and processing industries. Original forest cover in the coastal and lowland areas has been removed to a large extent during the previous decades. Agriculture and plantation of oil palms are primarily responsible for land conversion, while strip mining and settlements expansion contribute to the overall trend. The remaining preserved forests are concentrated in the higher elevations. Official data/ and information regarding water quality and air quality are scarce, considering the existing economic activities concentrated in the area, water quality problems (wastewater & nutrients discharge from agriculture, contaminations from industrial waste waters) can be expected. The main watershed such as Barito and Batulicin watershed have also been reported to be in poor condition. Expansion of mining and plantation areas has also contributed to the land and soil degradation.

There are remaining important coastal ecosystems, which have been partially degraded due to the effects of sedimentation, industrial pollution, aquaculture development, urbanization, and coastal infrastructure development (i.e. ports).

Area Planning Planned MP3EI economic activities in this area include iron and steel, and coal production nodes, complemented by palm oil, timber and rubber production activities. To foster the economic development, MP3EI individual projects designated for coal mining, heavy industries (i.e. coal processing and metal smelting), oil palm (plantation & processing), and timber have

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Internal Scoping

been put forth. A number of power plants (mostly coal powered) and ports are also planned as part of the Connectivity development section of the MP3EI EC Kalimantan planning.

Environmental Risks and Concerns

Physiochemical Aspects With respect to the planned economic activities and KPIs designated for coal mining (including mining facilities) and processing (i.e. coal, iron-steel) in Kotabaru, Tanah Laut & Tanah Bumbu regency, direct impacts on the water and air quality can be anticipated. Considering the potential future expansion of mining areas driven by MP3EI and existing coal mines in the area, the risk of serious physical disturbances of surface and underground water flows will largely increase in the areas. Pollution from tailing leakages and wastewater discharge from the coal mine operations can also be expected, though these can be addressed during the EIA-stage, and managed at the project level. However, together with wastewater discharges from processing/heavy industries and nutrients discharges (oil palm plantation), the impacts are likely to have a cumulative nature. Mahakam, Barito and Batulicin river systems should receive particular attention in this regard. Air pollution from mining and raw materials handling operations is likely to occur as a result of MP3EI investments. In accumulation with atmospheric emissions from existing mining and MP3EI coal/iron-steel processing industries and energy generation (coal combustion), it can lead to the significant deterioration of regional air quality. Extensive future mining activities can also cause land degradation, when the removal of topsoil is not followed with good post-mining management practices. Combined with the impacts of intensive land-use from plantation and agricultural activities, the impacts are likely to be wide- scale and cumulative.

Ecosystems With increased economic activities (i.e. mining, oil palm) driven by MP3EI in the area, there will be a strong likelihood that deforestation will continue. If mining concessions in the remaining intact forest are utilized, the impact would be significant in scale. In addition, many mining concession are issued in potential conflict with protected areas and their future utilization can also lead to habitat fragmentation. Under MP3EI Connectivity plans, ports development in the sensitive coastal ecosystem will trigger further coastal degradation (including mangrove loss) and put additional pressure to the environmental quality in Marine Protected Areas in the surrounding Pulau Laut.

Socio-economic MP3EI economic activities are likely to have secondary impacts to public health as a result of air and water quality pollution from mining and mineral processing activities. Increased economic developments will also stimulate employment and therefore trigger incoming migration to the region. In addition, these increased economic activities and anticipated urban developments will also add extra pressure on public infrastructure (i.e. water and waste management capacities, health services). Other social problems related to immigration (i.e. changes of social and cultural structure, loss of employment for the local people, etc.) can also be expected if no mitigation measures are put in place to address likely future urban development issues.

Illustration of the potential cumulative impacts in the affected areas can be viewed in below Figure 2.4

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Figure 2.4 Map showing strategic environmental impact around Kotabaru, Tanah Laut and Tanah Bumbu regency

2.2.3 Area of Concern: Peat land Areas in Central Kalimantan

Baseline Information The concerned territory comprising of majority of Central Kalimantan and parts of South Kalimantan province, is known for its large peat-land areas, partially protected as conservation areas (i.e. Sebangau and Tanjung Puting National Parks). As the area is also characterized with relatively large remaining intact forest, it has a considerable biodiversity (most notably Orangutan). However, it has been under pressure of deforestation due to oil palm plantation and other land-intensive agroforestry and/or agriculture activities. The peat land conversion for oil palm plantations or other economic activities is of concern also due to the role of peatland in the carbon cycle and contribution of the land-use change to the increase of GHG emissions (CO2 release due to the peat drainage). Oil palm plantation concessions cover large parts of the concerned territory, in some cases in apparent conflict with protected areas and other designated land-use forms (e.g. mining concessions).

Air quality in the area is often compromised during the dry season due to the haze produced by large forest fires (in addition to the air pollution from industrial activities). As peat drainage motivated by desire for utilization of the land for economic activities is a common practice, land subsidence is often experienced followed by increase of associated risks of other natural disasters (floods, landslides, erosion, droughts). In addition, water quality monitoring stated that Kahayan River has been heavily polluted with mercury from artisanal gold mining in the area.

As population density and settlement are concentrated in urban areas like Palangkaraya and Sampit, increasing economic activities add extra pressure on the existing waste management capacities. Among the distinctive features of the concerned area are its culturally diverse population of indigenous people (known as Dayak tribes), who claim customary rights to a number of territories.

12 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Internal Scoping

Environmental Risks and Concerns

Physiochemical Aspects The MP3EI related investment in palm oil, timber, coal, iron-steel and food-agriculture sectors in this area will likely have impact on air and water quality. Considering the future expansion of coal mining areas within existing concessions, a physical disturbance to the surface and groundwater water flows can be expected. Pollution through leakages from tailing deposits and wastewater discharges can affect the water quality. In combination with emissions of nutrients discharged from the oil palm plantations, the impact on water quality can be cumulative. Air emissions resulting from mining and raw materials handling can usually be mitigated on the project level, however, cumulative effects with already existing air pollution and namely emissions from power generation (expected to increase as a result of MP3EI investments) may have significant negative impacts on the air quality. MP3EI oil palm development can potentially trigger further utilization of available oil palm plantation concessions on peat areas and thus will lead to peat-land degradation and to the further increase of the risks of land subsidence.

Ecosystems MP3EI driven oil palm plantation development will likely trigger the conversion of the remaining forests and peat areas and thus reinforce continuing loss and fragmentation of important ecosystems. Although there are no specific MP3EI mining projects located in the forested area, existing mining concessions and MP3EI mining strategy may contribute to further deforestation and peat loss. Potentially strong negative impacts on biodiversity are connected with habitat fragmentation especially if oil palm development occurs in ecological corridors of specific species (i.e. Orangutan). In coastal areas, the pressure on the remaining mangrove and coral ecosystems can increase as a result of the MP3EI investments in port development.

Socio-economic In regard to socio-economic issues, MP3EI oil palm sector development will likely have the spatial conflict with customary lands as some oil palm plantation concessions are located on the territories claimed by the indigenous communities. Increased economic activities (i.e. industrial plantation) will also trigger potential land-use conflicts with subsistence agriculture. The expected increase in urbanization, driven by MP3EI stimulated economic growth, will put extra pressure on the existing public infrastructures, including water and waste management capacities. In connection with the anticipated impacts of the MP3EI implementation on the air and water quality, the increase of risk of the negative impacts on public health will be plausible consequences.

Illustration of the potential cumulative impacts in the affected areas can be viewed in below Figure 2.5

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Figure 2.5 Map showing strategic environmental impact around peat areas in Central Kalimantan

2.2.4 Area of Concern: West Kalimantan (Ketapang, Kuburaya, Landak, Sanggau, Sekadau regency)

Baseline Information The territory is characterized by presence of large intact forests and peat-land areas, and comparatively low human settlements and population density. The area is known as a biodiversity “hotspot” with migration corridors of important species (including orangutan). Several parts are protected with conservation status such as Gunung Palung National Park in . Despite the considerable area of remaining intact forest, large segments of the landscape has already been subjected to deforestation and land conversion for oil palm plantation and other developments. Along the west coast there is a marine protected area in Karimata Island (Marine Nature Reserve) with remaining important coastal ecosystem.

The area is characterized by the presence of significant cultural diversity in a number of locations inhabited by indigenous people, claiming customary rights to their traditional territories. Main economic activities in the region include large scale agriculture farming and animal husbandry, oil palm plantation and timber logging. Important segment of the economy is also industries, both light and heavy (including bauxite processing).

Despite the lack of comprehensive information regarding water quality for this area, it is acknowledged that intensive artisanal gold mining activities reported in the number of areas in Bengkayang, Sintang, Sanggau and regency have caused significant impacts in terms of water pollution (namely mercury contamination) as well as impacts on the land and soil in the affected watersheds. Water and soil degradation are also experienced throughout the areas of intensively cultivated plantations.

14 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Internal Scoping

Area Planning Main MP3EI interventions in the concerned areas are intended to support palm oil, timber and bauxite production (see node of economic activities in Figure 2.6). A number of KPIs designated for investment in palm oil, timber and bauxite sectors are also planned in this area. To support the aforementioned economic developments, a number of port constructions are envisaged, and a road project is planned to provide connection from Sekadau to Sanggau Tayan (263.8 km).

Environmental Risks and Concerns

Physiochemical Aspects The extensive oil palm development is driven by MP3EI and is likely to have a major impact on further water resources degradation (both in quantity and quality). The increased irrigation demand for palm oil production will put pressure on available water resources. In addition, the conversion of virgin lands (both forests and/or peat lands) for oil palm plantation may also contribute to changes in water regime in affected watersheds. Together with climate change related effects (e.g. change in precipitation) it can lead to local water shortages. Namely, Kapuas Hulu watershed should receive attention considering the expected intensification of economic activities supported by the MP3EI implementation. Concerns regarding the impact of bauxite mining and processing on the air quality exists, however the risks can probably be well controlled at project level, whereas emissions from bauxite processing to water may contribute to cumulative impacts on water resources. Soil erosion and peat-land degradation are prevalent in most of agriculturally utilized areas.

Ecosystems MP3EI-related economic development based on oil palm plantation and timber extraction will likely accelerate deforestation in the area (considering the potential areal available for the future expansion). The plantation land expansion may also convert the remaining forests and peat areas, which will likely affect the terrestrial ecosystem and lead to habitat fragmentation, at the expense of many vulnerable species (i.e. Orangutan). Considering the high conservation value and the presence of important bird areas, the direct impact on forest can also lead to a significant biodiversity loss. Further analysis is needed to see the scale of oil palm development with or without the forest moratorium.

Socio-economic A major potential issue related to the MP3EI development in the concerned area is the existence of land-use conflicts over customary lands, most notably in the context of new oil palm plantation development. Land-use conflict over protected areas and remaining forests area can also be expected when MP3EI-supported palm oil and timber production will result in pressure towards utilization of already issued concessions in those areas. Promotion of industrial-scale plantation can also out-compete subsistence agriculture, and thus affect livelihood of local communities and contribute to social tensions. Public health risks can be attributed to the degradation of safe water resources due to cumulative effects of pollution from existing artisanal gold mining and discharges from palm oil production.

Illustration of the potential cumulative impacts in the affected areas can be viewed in Figure 2.6

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Figure 2.6 Map showing strategic environmental impacts around West Kalimantan

2.2.5 Area of Concern: Pontianak Broader Area

Baseline Information The area of concern covers parts of Pontianak, Bengkayang, Sambas, Landak and , with the main focus concentrated on Pontianak broader area. Despite the existence of remaining forest and peat-land areas, partially registered as conservation areas such as Gunung Raya Pasi Nature Reserve with considerable biodiversity value (i.e. meranti, marabatu and Eugenia sp flora) and Niyut Penrissen Nature Reserve, the majority of the concerned territory has a record of intensive deforestation, followed in some regions by intensive agriculture cultivation and industrial development. Of importance is the cultural diversity of the region with number of territories claimed as customary lands and locations inhabited by indigenous people in Pontianak and (referring to customary lands data from Participatory Mapping Working Group [JKPP] in 2013). The extent of mining and oil palm plantation concessions in the area is considerable and thus potential for future conflicts over land-use exist.

Among apparent environmental problems, there are heavy pollution in Kapuas River caused not only by the mercury contamination (artisan gold mining), but also by wastes discharge from factories and agriculture (e-coliform bacteria and pesticides). An NGO, WALHI, reported in 2011 that mercury contamination occurs namely in upstream areas of Sekadau and , where it exceeded any acceptable levels. As Kapuas River is still a significant source of water for domestic use, concerns over clean drinking water provision are arising. Soil degradation is another known environmental issue related to the intensive agriculture activities, including oil palm plantation. The existing agriculture did not only affect the water quality but also the water quantity due to the intensive use of water both for agriculture and oil palm irrigation, and products processing.

16 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Internal Scoping

Area Planning Main MP3EI economic development designated in this area belongs to the timber and palm oil production sectors, represented by the Timber production node and number of individual projects of various economic activities, including heavy industry projects (mangan processing/smelter) located in investment zone (KPI) of Bengkayang. MP3EI roads development is also planned to connect Singkawang-Pontianak-Sanggau-Sekadau. Several power generation units are also planned to provide energy supply for the related economic activities and urban development.

Environmental Risks and Concerns

Physiochemical Aspects MP3EI economic developments in oil palm development and heavy industries are likely to increase air and water pollution. Considering the existing water pollution from mercury contamination is caused mainly by the artisanal gold mining, nutrients discharges and pesticides use, the MP3EI palm oil production activities are likely to contribute to cumulative impact on water quality. Similarly, the MP3EI heavy industries (bauxite or mangan smelter) may also contribute to the worsening of air quality. If mining concessions are fully utilized in the future (driven by MP3EI mining strategy), the impact may be cumulative and can affect the regional air quality. The monoculture nature of oil palm plantation can also affect soil quality and lead to soil degradation. Soil erosion and its effects in important watersheds and impacts on the environmental quality in the downstream area are also of importance.

Ecosystems The MP3EI support for palm oil and timber production may contribute to continuation of deforestation and possibly lead to the habitat fragmentation and loss of biodiversity. Considering the extent of area with already issued concessions (both mining and oil palm plantation), the magnitude of the impact will be of strategic importance should majority or all of the concessions be utilized. Although mining is not priority MP3EI supported activity in this area, if mining concessions in the protected areas are utilized, there will be clear conflict and strategic impact on ecosystems and habitat fragmentation.

Socio-economic Potential socio-economic issues related to the MP3EI include increased risks to public health due the secondary impact from water contamination (i.e. metals processing and palm oil production). The existing contamination from mercury and E. coli bacteria together with pesticides use from MP3EI-promoted palm oil production may cause the water quality to exceed acceptable levels compared with clean-drinking water standards. Of particular importance is the potential land use conflicts over customary lands related to oil palm plantation development. This in turn might also trigger social conflicts with the indigenous people that are protecting their territorial customary rights. As the economic activities grow, triggered by MP3EI policies and investments, they are likely to generate extra pressures on public infrastructure, especially in terms of water supply and waste management capacities. If additional capacities are not provided, the impact may be significant to the population. Illustration of the potential cumulative impacts in the affected areas can be viewed in Figure 2.7.

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Figure 2.7 Map showing strategic environmental impact around Pontianak broader area

2.2.6 Others In addition to expected impacts occurring in the above indicated areas of concern, several other issues have been identified as potentially having large scale or strategic impacts from the MP3EI EC Kalimantan planning. One of the major projects planned in the Kalimantan EC is the development of KIPI Maloy (Integrated Industrial Zones and International Port), located in Kutai Timur regency, East Kalimantan Province. To support the access to this area, a road is planned to cut through Sangkulirang Peninsula and karst, which represents one of the most diverse forests in Kalimantan. A key strategic impact from this development is the potential habitat fragmentation and physical disturbance to terrestrial ecosystem, triggered by the open access to formerly inaccessible forests that can lead to increased illegal poaching or logging2. Considering the potential scale of impact triggered by activities related to the international port development, there can be anticipated strategic impact to the coastal ecosystem (i.e. remaining corals and mangroves). KIPI Maloy is located very closely to Miang Island, which is the major migration area for several species of large whales and belongs to a habitat of the most diverse community of marine mammals in Kalimantan waters. Development of the international port in close proximity of the island, as well as proposed development of a coal terminal on the Miang Island, would lead to disturbance and eventual disappearance of these large animals. In addition, impacts on the social situation might emerge as well, such as an increase of immigration-related problems that may entail the public health risks (e.g. possible transmissible diseases occurrence and water quality supply issues) as well as socio-cultural concerns due to changes of local social and cultural structure.

2 Feedbacks obtained from the stakeholder consultation in EC pre-scoping workshop, in Balikpapan, October 2012.

18 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Internal Scoping

2.3 Summary of Scoped Issues for Further Analysis

Drawing from the results obtained during the scoping activities, each identified strategic issue was preliminarily assessed in terms of potential geographic locations in which the conflict could occur. Table 2.2 presents a summary of the identified strategic conflicts for further analysis along with the details of the affected Kalimantan EC areas. These issues will also be considered in further analysis carried out during the next SEA stages.

Table 2.2 Issues for further SEA analysis related to corresponding areas of Kalimantan EC

Type Conflict Areas of concern

Samarinda, Balikpapan (e.g. Increase of air & water pollution from Wain river), Bontang, Kotabaru economic activities regency, Tanah Bumbu regency

Areas of agriculture activities (oil Environmental Land and soil degradation due to oil palm) in East Kalimantan, Quality palm plantation and mining activities Central Kalimantan and West Kalimantan

Peatland areas in Central Peat land degradation and land Kalimantan and West subsidence risks Kalimantan

Further deforestation due to oil palm Pontianak broader area, areas plantation and mining activities, within oil palm concessions in including impact on legally protected East Kalimantan and West areas Kalimantan

Habitat fragmentation and loss of Kutai National Park and other Ecosystem biodiversity (e.g. flag species) due to protected areas and unprotected infrastructure development and biodiversity hotspots in East economic activities Kalimantan

Coastal ecosystem degradation due Pulau Laut, Balikpapan Bay and to ports and coastal development Mahakam delta coastal areas

Increased pressures on water and Urbanized areas in Samarinda, waste management capacities in Balikpapan, Bontang city and urban areas Kotabaru regency

Customary lands in East Land use conflicts over customary Kalimantan, West Kalimantan land and indigenous communities and Central Kalimantan Socio-economic Agriculture areas in East Land-use conflict between industrial Kalimantan, West Kalimantan plantations and subsistence farming and Central Kalimantan

Public health risks related to Urbanized areas in Samarinda, environmental quality (air, water and Balikpapan, Bontang city and food contamination) Kotabaru regency

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2.4 Preliminary Recommendations

Following the internal scoping exercise, the following preliminary recommendations are proposed.

2.4.1 Agroindustry It is recommended that palm oil productive areas should be firmly established/ limited in line with principles outlines in the Roundtable Sustainable Palm Oil (RSPO) Production/Meja Bundar untuk Produksi Kelapa Sawit Berkelanjutan. For Kalimantan EC, this should be applied in all potentially impacted areas.

It is also recommended that provincial spatial plans should apply criteria for allocation of oil palm plantation areas based on the ‘soil categorization’/kesesuaian lahan developed by Ministry of Agriculture.

In addition, irrigation capacities that should be planned in the context of integrated watershed management planning in order to prevent depletion and degradation of water resources

Possible MP3EI / RPJMN Policy Suggestion is to legislate, enact and enforce principles outlined in the ‘Roundtable on Sustainable Palm Oil (RSPO) Production’

2.4.2 Mining In order to mitigate the adverse impact from mining activities, it is recommended to apply strict control of implementation during mining closure and reclamation plans (including their regular update during the mine operation phase). For Kalimantan EC, this should be applied to both existing and future mining activities.

In addition, possible MP3EI / RPJMN Policy Suggestion are as follow:

1. Introduce strict mining regulations for the design facilities related to, or management of :

- Hazardous material and tailings ponds (including restriction on deposition of tailings/mining waste to the rivers/sea/lakes)

- Site water and waste management

- Site closure (re-cultivation)

- Also, firmly establish legal liability in relation to site emission, contamination or accidents

2. Develop strict mining selection criteria for the EC/Provinces and require that all future mining applications (via EIA procedures) comply with the regulations.

2.4.3 Heavy Industry / Connectivity – Power Generation It is recommended to require that all planned industrial zones and identified pollution ‘Area of Concerns’ undergo an appropriate level of environmental assessment (SEA) to determine the likelihood of cumulative environmental impacts and to determine the need to:

• Relocate the planned industrial activities and/or • Require the need to implement programmes to achieve cleaner production

20 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Internal Scoping

Related to the above recommendation, particular attentions in Kalimantan EC should be given to Kotabaru and Tanah Bumbu regency, Balikpapan Bay, Bontang city, Sanggau, Mempawah and Ketapang regency.

In addition, possible MP3EI / RPJMN Policy Suggestion include as follow:

• Make application of Best Available Techniques (BAT) a requirement in all new EIA (permitting procedures), and permit renewals

• Ensure consistent enforcement of compliance of industrial facilities with air and water quality standards

2.4.4 Connectivity It is recommended to develop new planning rules for the routing of roads or location of ports and/or required mitigation measures (establishing ecological corridors, compensation actions).

In addition, it is advised to extend water and wastewater management initiatives for all growing urban centres, as well as initiatives supporting alternative and clean public transport.

For Kalimantan EC, particular attentions in relation to the above recommendations should be given to Balikpapan, Samarinda and Bontang city and Kotabaru and Tanah Bumbu regency

Possible MP3EI / RPJMN policy suggestion is to set strict goals, investment levels, and operationalized steps to meet national goals for clean drinking water, sustainable modes of transportation, and wastewater/waste management facilities.

2.4.5 Social Issues In order to timely address social dimension (namely potential conflicts), it is recommended to ensure that EC developments respond to the needs for quality and capacity of services in urban areas (waste management, clean water and sanitation, education and health services) with respect to the expected intensification of migration flows and presence of considerable migrant population. Particular attention in Kalimantan EC should be given to Balikpapan, Samarinda and Bontang city; Pontianak city and urban areas in Kotabaru regency

In addition it is recommended to ensure that EC developments respect the livelihoods and territorial rights of indigenous people to avoid social conflict: In this regard, particular attention in Kalimantan EC should be given to all relevant areas.

Consideration needs to be given to local fishing communities, whose livelihood depends on production of the healthy freshwater and marine ecosystems, and also to the fact that the major proportion of the population living along Kalimantan coast and rivers depends on fish and seafood as the major source of protein, and their health will be affected by increasing levels of toxins contained in this food.

Aiming at the higher level of planning, possible MP3EI / RPJMN Policy suggestions that can be proposed are as follow:

• Ensure coordinating and technical assistance of responsible ministries (i.e. Coordinating Ministry of Social Welfare, Ministry of Health etc) in order to systematically address social issues resulting from the MP3EI developments

• Ensure availability of financial funds to develop infrastructures and services necessary to accommodate anticipated additional needs resulting from the MP3EI developments

• Ensure streamlining/coordination of policy related to acknowledgement and protection of customary lands and indigenous peoples’ rights.

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3 Stakeholder/Public Consultation

Stakeholder and Public Consultation is a key part of the SEA process. Consultation constituents a key procedural step after the initial environment scoping analysis. Results of the consultation process will be combined with the Scoping results and feed into the further detailed analysis of strategic environmental issues.

Public and stakeholder consultation is a legal requirement of SEA as per Law No. 32/2009 concerning Environmental Protection and Management (Article 18, paragraph (1)) and the State Ministry of Environment’s Regulation No. 09/2011 concerning General Guidelines on Strategic Environmental Assessment (Introduction; Sections 3, 5, and 6). Consultation will:

• Greatly enhance the legitimacy of PPP for the community • Ensure the commitment of all stakeholders • Allow additional information to be gathered • Gain an overview of the relationship between community groups and institutions

3.1 Organisation and Methodology

3.1.1 Stakeholder Mapping and Workshop Attendees Stakeholder mapping was carried out during the SEA Inception Phase for the purpose of all consultative initiatives for the Project. The approach to develop a list of attendees for the Kalimantan Scoping Workshop was to prioritise inviting the attendees and organisations that were invited to the Pre-Scoping workshop. This list was communicated with both Bappenas and KLH; and, after some minor revisions, the attendee list was finalised. Key stakeholders organisations that participated in the sessions included Bappeda, BLHD, PPE (Ecoregion Office), academics, professional associations, and NGOs.

The Stakeholders that attended the workshop are detailed further within Appendix D

3.1.2 Objective and Approach

The objectives of the Stakeholder Consultation on MP3EI SEA for Kalimantan EC were:

• To carry out planning level ‘scoping’ capacity building for future application for the involved agencies and, also, to enhance stakeholder feedback

• To present preliminary findings from Internal Scoping

• To document and respond to questions or concerns from stakeholders for consideration in subsequent analysis stages of the SEA

• To obtain additional baseline information and expert input that will aid subsequent analysis stage of the SEA

This approach for achieving these objectives was to hold a day and half workshop, where the first third of the workshop was dedicated to capacity building and the last two thirds of the workshop was focused on presenting Internal Scoping results and obtaining feedback from the workshop participants.

The session included tailored presentations or exercises, with supporting information in the form of hand-outs and maps distributed to the attendees. The approaches and content for the workshop are further explained in the underlying bullets points.

22 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Stakeholder/Public Consultation

• Capacity building slides aimed to communicate

- The position of ‘scoping’ within the overall SEA process as well as it strengths and limitations

- Various methods and tools for scoping

- What ‘good’ scoping consist of

- The MP3EI approach and GIS database

- Presenting generic animated slides illustrating the definition of strategic issues at the EC level and further illustrating this with real mapped examples uncovered from the MP3EI internal scoping

- Carrying out a hands-on scoping exercise of an identified area of concern

• Internal Scoping results focused on presenting or seeking

- The importance of stakeholder inputs and position of the scoping analysis with the overall MP3EI EC SEA process

- The EC projects and Strategies (e.g. Nodes and KPIs)

- Each ‘Area of Concern’ and carefully outlining key baseline features, the MP3EI plans, and the key strategic risk identified

- Immediate comment or feedback from the stakeholders regarding the findings

- Preliminary recommendations

- Opening the floor in plenary style discussions.

3.1.3 Overview of Proceeding Results The Scoping Workshop and Stakeholder Consultation were conducted in Jakarta on 18-19 March 2014. In Day-1, a hands-on scoping exercise was undertaken to demonstrate to the participants the approach to the execution of SEA scoping. An introductory presentation on the key objectives and procedures of scoping were delivered, as well as the applicable general approach usually used in scoping, together with illustration of generic scoping examples. Following discussion of appropriate Scoping methods and procedure, the participants were asked to undertake scoping exercise using MP3EI cases while using baseline information from GIS database and discussing potential impacts from the MP3EI planning. In the end of the workshop, evaluation forms were distributed to each of the participants to obtain their feedbacks.

In Day-2, preliminary findings from the internal scoping were presented to the participants to get their feedbacks for verification of issues and additional information for further SEA stages. A number of substantial reactions and inputs were obtained from the workshop and documented for the next stage of analysis. The responses addressed different aspects of MP3EI and SEA in the economic corridor such as new baseline information, inputs to preliminary scoping results and suggestions for improvement of the preliminary recommendations for MP3EI / RPJMN. The detail description of stakeholders’ feedbacks together with documentation of the workshop, are provided in Appendix E.

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An outline of the agenda for the Scoping Workshop is presented in the following table.

Table 3.1 Agenda for Kalimantan EC Stakeholder Consultation

Day 1, 18 March 2014 (Half Day)

Time Agenda Remarks

12.00 – 13.00 Registration and lunch Registration desk

13.00 – 13. 15 Opening

 Opening speech from KP3EI Connectivity Working Group KP3EI Connectivity  Opening speech from EC PIC Ministry Working Group

13.15 – 13.35 Introduction to MP3EI SEA MP3EI SEA Team  Review of General & MP3EI SEA processes  Scoping Phase

13.35 – 14. 20 Session I: SEA Scoping Methods and Principles MP3EI SEA Team a. Purpose b. Common Approaches and Limitations c. MP3EI Approach/ GIS Overlay-Matrix

14.20 – 14. 35 Coffee Break

14.35 – 16.05 Session II: Hands-on Scoping Exercise MP3EI SEA Team a. Definition of strategic issues b. Application of scoping matrices c. Example how to use GIS Database d. Execution of hands-on scoping for MP3EI cases

16. 05 – end Wrap up and closing

19.00 – end Dinner

Day 2, 19 March 2014 (Full Day)

Time Agenda Remarks

08.00 – 09.00 Morning registration Registration Desk

09.00 – 09.45 Introduction MP3EI SEA Team  General Review of MP3EI SEA and Objectives of Consultation Sessions  Overview of MP3EI Policies, Plans and Programs in EC  Definition of Strategic Issues

09.45 – 10.00 Coffee Break

10.00 – 12.30 Session I : Internal Scoping Findings MP3EI SEA Team a. Scoping Approach/Expert Scoping b. Presentation of internal scoping findings of MP3EI SEA team using GIS maps c. Discussion and Q&A.

12.30 – 13.30 Lunch

13.30 – 14.30 Continued previous session (If needed) MP3EI SEA Team

24 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Stakeholder/Public Consultation

Time Agenda Remarks

14.30 – 15.00 Session II : Preliminary recommendations for EC SEA MP3EI SEA Team

15.00 – 15.30 Coffee Break

15.30 – 17. 00 Session III : Plenary discussion Paparan Kelompok

17.00 – 17.15 MP3EI Next Steps MP3EI SEA Team

17.15 Closing

3.2 Summary and Resolution of Key Feedbacks

The key public comments were concerned with the environmental and social impacts of the MP3EI planning in the economic corridor, and the planned infrastructures or connectivity projects. This includes concerns over environmental carrying capacity of the region/provinces in relation to MP3EI economic activities (oil palm, mining, heavy industries, etc); risks and impacts to important ecosystem and biodiversity in the region, and how the traditional culture (including customary rights) might be impacted by the new development driven by MP3EI.

Following are the list of key concerns documented from the stakeholder consultation, structured along the area of concern. Details of consultation responses are provided in Appendix A.

Table 3.2 provides the list of these key concerns and the corresponding section within the SEA where resolutions are provided.

Table 3.2 Key concerns & responses from Stakeholder consultation session in Kalimantan EC

No. Key Concern

Samarinda, Balikpapan and Bontang City Hotspot

MP3EI policies to designate Kalimantan as national centre for energy production will add 1 pressures to energy supply for the local, particularly for East Kalimantan.

MP3EI toll road from Balikpapan to Samarinda is likely to conflict with protected areas and 2 biodiversity hotspots

Kotabaru, Tanah Laut and Tanah Bumbu regency Hotspot

1 Public safety issues related to flood risks to MP3EI industrial activities in Kotabaru regency

Watershed management related to MP3EI mining and heavy industry activities in the vicinity of 2 watershed areas. Particular concern: Batulicin watershed

Central Kalimantan (Peat land) Hotspot

Upstream MP3EI activities (industries) in West Kalimantan is likely to affect the watershed 1 quality and quantity in downstream area of Central Kalimantan

Upstream MP3EI oil palm and heavy industries activities will have secondary impact to coastal 2 ecosystem in Sukamara regency

West Kalimantan Hotspot

Extreme landscape differences between West Kalimantan and Central Kalimantan may cause 1 impact from upstream activities in Central Kalimantan.

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No. Key Concern

Other key concerns relevant to Kalimantan

Strategic impact from MP3EI individual project, i.e. Integrated Industrial Zones and International 1 Port in Maloy, Kutai Timur. Possible cumulative and interactive impact to the forest fragmentation, coastal degradation and social issues.

Issues of overlapping land-use permits between different sector (i.e. plantation, mining, protected 2 areas) will cause the delay legislation of provincial spatial plans.

3 To include groundwater regime within water quality analysis

4 To include impact from emissions in physio-chemical parameter To include the water quantity (resources) concern in the watershed management measures, 5 impacted from mining activities (also relevant for processing/ heavy industries)

6 To include the issues of new and renewable energy into the analysis

To include land suitability analysis (kesesuaian lahan) to identify land capacity suitability for 7 MP3EI oil palm activities.

The consultation responses as detailed within Table 3.2 were generally in line with the scoped issues as presented in Section 2 (Strategic Issues in Areas of Concerns). In some cases, specific issues raised were at a level of detail more suitable for further assessment through an individual project EIA / AMDAL process. However, all comments provided during the consultations session were noted and addressed at a strategic level in the SEA assessment.

3.3 Relevance for Scoped Issues

Following the presentation of the results from the internal scoping exercise and some round table discussion of these findings, stakeholder feedback was invited and discussed at the final session.

The main topic that came up repeatedly at the stakeholder consultation workshop was that of changing land-use (particularly from peat land areas to oil palm plantation and other land conversion for mining activities), which in turn cause upstream watershed degradation that affect the environmental quality in the downstream areas. Most of the stakeholders commented in agreement that the present impacts of oil palm development and were very concerned by the future impacts in land conversion due to the increased economic development driven by MP3EI. The resultant impacts that were highlighted were the wildlife (protected areas) and watershed issues (where upstream watershed converted and can affect to downstream environmental quality). Others also concerned with the land suitability and environmental carrying capacity of the areas that will be converted and utilized into oil palm plantations as it will also have impacts to land and water resources degradation.

Some legislative recommendations (e.g. limitations of plantation growth area and utilizing the degraded land for future development; introduction of stricter mining regulations and green mining practices) were put forward (as provided in the minutes in Appendix C), but this is outside the scope of the SEA. It was recommended that oil palm plantation and their supply chains should be certified by either Roundtable for Sustainable Palm Oil (RSPO) or Indonesian Sustainable Palm Oil (ISPO).

As energy production is the main theme of MP3EI economic development in the region, participants also stressed out the importance to explore alternative renewable energy sources to reduce the dominant use of coal to supply the needs of MP3EI activities and prevent the energy

26 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Stakeholder/Public Consultation

depletion risks for domestic use. This could include the use of geothermal sources, biodiesel and recycled waste (can be used as fertilizers to supply agricultural demands as well).

Overall, the views appear to indicate that the impacts considered to be the most important were direct present-day impacts from land-use conversion (especially forests and peats) that were already affecting the population. Indirect future impacts, e.g. public health risks from increased industrialisation or urbanisation, were not considered to be immediate, and therefore significant, threats.

27

4 Priorities for Further Analysis

The results in this section were obtained from a synthesis of the results from the internal scoping workshop (Section 2) and the feedback from the stakeholder consultation workshop (Section 3). In terms of identifying the key strategic environmental issues, the findings can be summarised under three major headings.

Environmental Quality Implementation of the MP3EI will lead to an intensification of pollution in terms of air and water quality from infrastructure development and increased economic activities (e.g. mining, plantations, oil and gas, industries). Decreasing level of underground water, land and soil degradation (including peat subsidence risks) through peat conversion for oil palm plantation, the risk of complete loss of upper layer of fertile soil due to repeated planting of oil palms, as well as unsustainable coal mining practices will also become more prevalent in certain areas. Downstream impacts of these activities (sedimentation, periodic floods and droughts) will in some cases lead to environmental disasters.

Ecosystem Forest-based ecosystems will be severely impacted, including those within legally protected areas and where peat forests are converted. This is mostly through changing land-use for oil palm plantations along with urban and industrial development. Habitat loss and fragmentation due to infrastructure developments and increased economic activities will lead to loss of biodiversity, especially impacting on already endangered and important flag species. Coastal development, leading to water pollution and increased sediment loading will also cause degradation of proximal coastal marine ecosystems (e.g. mangrove and coral loss).

Socio-economic Increased urban and industrial development will lead to increased pressures on both water and waste management. Expanding urbanisation and economic activities (i.e. oil palm and mining) increases the risk of conflicts between developers and indigenous communities over customary lands and potentially large risk of losing traditional/subsistent livelihoods from industrial scale economy. MP3EI strategy on energy generations for national supply will also increase the likelihood of local energy shortage for Kalimantan itself. Pollution, sedimentation and coastal/riverside forest destruction resulting from proposed industrial development, oil palm plantations and coal mining is likely to increase poverty in local fishing communities due to the loss of livelihood. Toxins contained in the seafood due to the industry, mines and plantations, are likely to impact health of the majority of human population, which largely depends on seafood as the source of protein. There will also be increased public health risks related to the environmental quality of air and drinking and bathing water.

In summary, Table 4.1 represents the key strategic issues to be considered further within the SEA assessment.

Table 4.1 Summary table of EC strategic issues for further analysis

Receptor Applicable Areas of Specific Areas for Further Identified Strategic Issues Type Concern Analysis

• Mahakam River and related watershed Samarinda, Increase of air and water Balikpapan, Bontang, • Balikpapan Bay pollution from economic Kotabaru regency, activities watershed and Batulicin Tanah Bumbu regency watershed

Physiochemical

28 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Priorities for Further Analysis

Receptor Applicable Areas of Specific Areas for Further Identified Strategic Issues Type Concern Analysis

Penajam Paser Utara (East Areas of agriculture Land and soil degradation due Kalimantan), Sanggau and activities (oil palm) in to oil palm plantation and mining (West Central Kalimantan and activities Kalimantan), Kutai Timur West Kalimantan regency

Pulang Pisau and Katingan Peat land areas in Peat land degradation and land regency (Central Kalimantan) Central Kalimantan and subsidence risks and Kubu raya and Ketapang West Kalimantan regency (West Kalimantan)

Further deforestation due to oil Pontianak broader palm plantation and mining area, areas within oil Sanggau and Kapuas Hulu activities, including impact on palm concessions in regency legally protected areas West Kalimantan

Habitat fragmentation and loss Kutai National Park, of biodiversity (e.g. flag species) Kutai National Park and Balikpapan Bay, Bukit due to infrastructure other protected areas in Suharto Forest Park, development and economic East Kalimantan Mahakam Lakes.

activities Ecosystem

Coastal ecosystem degradation Pulau Laut and Coral reef and seagrass beds in Balikpapan Bay and due to ports and coastal Mahakam delta coastal Mahakam delta, Mangrove development areas and marine protected areas in Pulau Laut

Urbanized areas in Increased pressures on water Samarinda, and waste management Balikpapan, Bontang Balikpapan capacities in urban areas city and Kotabaru regency

Customary lands in Land-use conflict over Areas are widespread and

East Kalimantan, West customary lands and indigenous specific area to be further Kalimantan and Central communities determined Kalimantan

Land-use conflict between Agriculture areas in Areas are widespread and industrial plantations and West Kalimantan and specific area to be further

subsistence farming Central Kalimantan determined Socioeconomic

Likelihood of local energy shortage from MP3EI EC East Kalimantan Balikpapan strategy on energy generations

Public health risks related to Urbanized areas in Samarinda, Balikpapan, environmental quality (air, water East and South Bontang city and urban area and food contamination) Kalimantan in Kotabaru regency

29

5 List of Reference

Jaringan Kerja Pemetaan Partisipatif (JKPP). 2013. Peta Indikatif Wilayah Adat Indonesia. Bogor: JKPP

Kementerian Lingkungan Hidup. 2011. Status Lingkungan Hidup Ekoregion Kalimantan. Balikpapan: PPE Kalimantan

Kementerian Lingkungan Hidup. 2008. Status Lingkungan Hidup Indonesia 2007. Jakarta: Kementerian Lingkungan Hidup (KLH)

Kementerian Lingkungan Hidup. 2007. Laporan Pelaksanaan Pemantauan Kualitas Air di 33 Provinsi. Jakarta: KLH

Kementerian Lingkungan Hidup. 2009. Indeks Kualitas Lingkungan Hidup. Jakarta: KLH

Kementerian Koordinator Bidang Perekonomian. 2013. Revisi Draft Masterplan Percepatan & Perluasan Pembangunan Ekonomi Indonesia. Jakarta: Kemenko

Law No 32 Year 2009 regarding Environmental Protection and Management (Undang-Undang Perlindungan dan Pengelolaan Lingkungan Hidup)

Miettinen, Jukka; Hooijer, Tollenaar, D; Page, Sue; Malins, Chris; Vernimmen, Ronald; Shi, Chenghua; and Liew, Soo Chin. 2012. Historical Analysis and Projection of Oil Palm Plantation Expansion on Peatland in Southeast Asia. Washington DC: NUS-Deltares-ICCT

30 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

APPENDICES

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APPENDIX A – List of Baseline Data Contributor

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A Baseline Data Sources

A.1 National Data

Data Date No. Content Language Source Format Received 1 Land Ecoregion Map SHP Bahasa Ministry of Environment 22-07-13 2 Sea Water Quality Monitoring in Indonesia Book Bahasa Ministry of Environment 22-07-13 3 Lake Water Quality Monitoring in Indonesia Book Bahasa Ministry of Environment 22-07-13 4 Population Excel English Statistic Indonesia 26-07-13 5 Illiteracy Rate Excel English Statistic Indonesia 26-07-13 6 School Participation Rate 2012 Excel English Statistic Indonesia 26-07-13 7 Percentage of Poor People Excel English Statistic Indonesia 26-07-13 8 Indonesia Basemap (Regency, Province) SHP Bahasa Bappenas 30-07-13 9 Indicative Moratorium Map Rev. 4 SHP English UKP4 30-07-13 10 MP3EI Road SHP English Bappenas 30-07-13 11 Investment Focus Area SHP English Bappenas 30-07-13 12 MP3EI Infrastructure Project SHP Bahasa Bappenas 30-07-13 13 GDP Rate Excel English Bappenas 28-08-13 14 Open Unemployment Excel English Bappenas 28-08-13 15 Indonesia Conservation Areas Map SHP English Ministry of Forestry 30-08-13 16 Moratorium Area Map (Forest, Peatland) SHP Bahasa Ministry of Forestry 30-08-13 17 Mangrove Area Map SHP Bahasa Ministry of Forestry 30-08-13 18 Fire Hotspot 2005 - 2013 SHP English Ministry of Forestry 02-09-13 19 Peatland SHP English Ministry of Forestry 02-09-13 20 Mangrove Area Map SHP English Ministry of Forestry 02-09-13 21 World Heritage SHP English UNESCO 06-09-13 22 Health facilities by province PDF Bahasa Statistic Indonesia 13-09-13 23 HIV/AIDS Cases PDF English Statistic Indonesia 13-09-13 24 Malaria Cases PDF English Statistic Indonesia 13-09-13 Ministry of Marine Affair 25 Marine Protected Area SHP English 18-09-13 and Fisheries World Resources 26 Oil Palm 2010 SHP English 23-09-13 Institute 27 Kalimantan Island Spatial Planning (RTRW) SHP Bahasa Ministry of Public Works 27-09-13 28 Sumatera Island Spatial Planning (RTRW) SHP Bahasa Ministry of Public Works 27-09-13 29 Jawa-Bali Island Spatial Planning (RTRW) SHP Bahasa Ministry of Public Works 27-09-13 30 Sulawesi Island Spatial Planning (RTRW) SHP Bahasa Ministry of Public Works 27-09-13 31 Maluku Islands Spatial Planning (RTRW) SHP Bahasa Ministry of Public Works 27-09-13 32 Papua Island Spatial Planning (RTRW) SHP Bahasa Ministry of Public Works 27-09-13

Data Date No. Content Language Source Format Received Nusa Tenggara Islands Spatial Planning 33 SHP Bahasa Ministry of Public Works 27-09-13 (RTRW) 34 MP3EI Main Activities SHP Bahasa KP3EI 07-10-13 LIPI (Indonesian Institute 35 Coral reefs distribution SHP Bahasa 21-10-13 of Science) LIPI (Indonesian Institute 36 Sea grass distribution SHP Bahasa 22-10-13 of Science) 37 Land Cover 2006, 2009, 2011 SHP Bahasa Ministry of Forestry 23-10-13 Deforestation 2003-2006, 2006-2009, 2009- 38 SHP Bahasa Ministry of Forestry 23-10-13 2011 39 Indicative Moratorium Map Rev. 4 SHP Bahasa Ministry of Forestry 23-10-13 40 Peatland (source: Ministry of Agriculture) SHP Bahasa Ministry of Forestry 23-10-13 41 Illiteracy Rate 2011 and 2012 Excel English Statistic Indonesia 23-10-13 42 School Participation Rate 2011 and 2012 Excel English Statistic Indonesia 23-10-13 BNPB (National Agency 43 Disaster Maps GDB English 24-10-13 for Disaster) BNPB (National Agency 44 Disaster Risk Maps GDB English 24-10-13 for Disaster) Ministry of Marine Affairs 45 Coral reefs distribution SHP English 31-10-13 and Fisheries Ministry of Marine Affairs 46 Sea grass distribution SHP English 31-10-13 and Fisheries Ministry of Marine Affairs 47 Mangrove distribution SHP Bahasa 31-10-13 and Fisheries 48 Indonesia Land Customary JPEG Bahasa Ministry of Environment 06-11-13 Wetlands International 49 Peatland SHP English 12-11-13 Indonesia Orangutan, Tiger, Elephant, and Maleo Wildlife Conservation 50 SHP English 12-11-13 distribution Society 51 Important Bird Area SHP English Burung Indonesia 20-11-13 Fauna and Flora 52 Aceh forest 2006, 2009, 2011 SHP English 22-11-13 International Fauna and Flora 53 Orang Utan distribution in Aceh 2007 SHP English 22-11-13 International Fauna and Flora 54 Elephant habitat in Aceh 2009 SHP English 22-11-13 International Fauna and Flora 55 Tiger Distribution in Aceh 2009 SHP English 22-11-13 International Waters Concervation Area in Aceh 2012- Fauna and Flora 56 SHP Bahasa 22-11-13 2013 International Fauna and Flora 57 Mammals in Central Kalimantan SHP Bahasa 22-11-13 International Fauna and Flora 58 Orang Utan Habitat in Borneo SHP English 22-11-13 International

59 HCV Wild Life in Ketapang SHP Bahasa Fauna and Flora 22-11-13

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Data Date No. Content Language Source Format Received International Dipterocarpaceae, Migran Bird, Tiger 2011 in Fauna and Flora 60 SHP Bahasa 22-11-13 Lombok International Fauna and Flora 61 Mammals in Nusa Kambangan SHP English 22-11-13 International Elephant and Tiger in Kerinci Seblat National Fauna and Flora 62 SHP Bahasa 22-11-13 Park International Fauna and Flora 63 Tiger in West Sumatera SHP Bahasa 22-11-13 International 64 Sumatera Vision SHP Bahasa WWF-Indonesia 26-11-13 65 Kalimantan Vision SHP Bahasa WWF-Indonesia 26-11-13 66 Papua Vision SHP Bahasa WWF-Indonesia 26-11-13 67 Sumatera IBA and KBA SHP Bahasa WWF-Indonesia 26-11-13 68 Traditional Site_Merauke SHP English WWF-Indonesia 26-11-13 69 Settlement_Asmat SHP Bahasa WWF-Indonesia 26-11-13 70 Settlements_Mappi SHP Bahasa WWF-Indonesia 26-11-13 BIG (Badan Informasi 71 Customary Land SHP Bahasa 17-12-13 Geospasial) BIG (Badan Informasi 72 Custom Community SHP Bahasa 17-12-13 Geospasial) BIG (Badan Informasi 73 Mangrove SHP Bahasa 17-12-13 Geospasial)

A.2 Kalimantan EC Data Data Data No Content Language Source Province Format Received Laporan Status Lingkungan Hidup BLHD Kalimantan Kalimantan 1 Daerah Provinsi Kalimantan Timur Book Bahasa 2/10/2013 Timur Timur Tahun 2012

Buku Data Status Lingkungan Hidup BLHD Kalimantan Kalimantan 2 Daerah Provinsi kalimantan Timur Book Bahasa 2/10/2013 Timur Timur Tahun 2012

Database Pengaduan Kasus Tahun Hand BLHD Kalimantan Kalimantan 3 Bahasa 3/10/2013 2013 out Timur Timur

Ringkasan Diperluas: Identifikasi Landskap Kawasan Hutan Bernilai Bahasa WWF Kalimantan Kalimantan 4 Konservasi Tinggi Di Dalam dan Book and 3/10/2013 Timur Timur Sekitar Heart of Borneo, Kalimantan English Timur

RAD-GRK (Rencana Aksi Daerah - Bappeda Kalimantan 6 PDF Bahasa 11/10/2013 Gas Rumah Kaca) Kalimantan Timur Timur

Bappeda Kalimantan 7 RPJPD Kaltim 2005-2025 PDF Bahasa 11/10/2013 Kalimantan Timur Timur

Data Data No Content Language Source Province Format Received Laporan FGD MP3EI dan RAD-GRK Bappeda Kalimantan 8 PDF Bahasa 11/10/2013 Kaltim Kalimantan Timur Timur

Bappeda Kalimantan 9 Visi Misi RPJM Kaltim DOC Bahasa 11/10/2013 Kalimantan Timur Timur

Data lokasi pemantauan kualitas air BLHD Kalimantan Kalimantan 10 DOC Bahasa 29/10/2013 dan udara Timur Timur

Kalimantan 11 Peta Laju Deforestasi Kaltim- WWF JPG Bahasa WWF 16/10/2013 Timur

Pemerintah Kalimantan 12 National issues overview Kaltim DOC Bahasa Provinsi 13/10/2013 Timur Kalimantan Timur

PDF, Bappeda Kalimantan 13 Draft RTRW Kaltim DOC, Bahasa 29/10/2013 Kalimantan Timur Timur XLS

Bappeda DOC, Kalimantan 21 Laporan KLHS TIMDU Kemenhut Bahasa Kalimantan 29/10/2013 XLS Tengah Tengah

Bappeda SHP & Kalimantan 22 Peta SHP RTRWP Kalteng Bahasa Kalimantan 3/10/2013 JPEG Tengah Tengah

Bappeda Kalimantan 23 Raperda RTRWP Kalteng 2011 DOC Bahasa Kalimantan 4/10/2013 Tengah Tengah

JPEG Bappeda (Peta) Kalimantan 24 SK Menhut No. 529 2012 Bahasa Kalimantan 16/10/2013 &JPEG Tengah Tengah SK

Bappeda Kalimantan 25 Data-data Pengairan PPT Bahasa Kalimantan 6/10/2013 Tengah Tengah

Bappeda Kalimantan 26 Kalimantan Tengah Dalam Angka PDF Bahasa Kalimantan 7/10/2013 Tengah Tengah

Bappeda Perda No.1 Tahun 2011 tentang Kalimantan 27 PDF Bahasa Kalimantan 8/10/2013 RPJMD Kalteng 2010-2015 Tengah Tengah

Bappeda Kalimantan 28 Peta Sebaran Gambut JPEG Bahasa Kalimantan 9/10/2013 Tengah Tengah

Bappeda RPJPD Prov. KALTENG 2005-2025 Kalimantan 29 PDF Bahasa Kalimantan 10/10/2013 (Perda No 4 Tahun 2010) Tengah Tengah

Kalimantan 30 Buku Laporan SLHD Kalteng 2012 Doc Bahasa Bappeda 20/11/2013 Tengah

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Data Data No Content Language Source Province Format Received Bappeda Kalimantan 31 Peta Laju Deforestasi 2003-2008 JPEG Bahasa Kalimantan 11/10/2013 Tengah Tengah

Kalimantan 32 Buku Data SLHD Kalteng PDF Bahasa Bappeda 19/11/2013 Tengah

RPJMD Kalimantan Selatan 2011- Kalimantan 33 PDF Bahasa Bappeda 6-Nov-13 2015 Selatan

RPJPD Kalimantan Selatan 2005- Kalimantan 34 PDF Bahasa Bappeda 6-Nov-13 2025 Selatan

Pemerintah Kalimantan 35 RPJMD Kalimantan Barat 2008-2013 PDF Bahasa Provinsi 11/10/2013 Barat Kalimantan Barat

Kalimantan 36 RPJPD KALBAR 2008-2028 PDF Bahasa Bappeda 12/11/2013 Barat

Kalimantan 37 Buku Data SLHD Kalbar DOC Bahasa Bappeda 14/11/2013 Barat

Kalimantan 38 Buku Laporan SLHD Kalbar DOC Bahasa Bappeda 14/11/2013 Barat

Pusat Pengelolaan Status Lingkungan Hidup Ekoregion Ekoregion Kalimantan 39 PDF Bahasa 25/10/2013 Kalimantan (Laporan Tahun 2011 Kalimantan- EC Kementerian Lingkungan Hidup

Peta Ekosistem, Land cover, land Pulau 40 shp English WWF 26/11/2013 system Kalimantan

Pulau 41 hph kalimantan shp bahasa WWF 26/11/2013 Kalimantan

Pulau 42 Laporan MP3EI Kalimantan DOC bahasa WWF 26/11/2013 Kalimantan

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APPENDIX B – List of MP3EI Economic Activities and Connectivity Projects in Kalimantan EC

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MP3EI Planning Information in Kalimantan Economic Corridor

B MP3EI Planning Information in Kalimantan Economic Corridor

B.1 List of Economic Development Projects

Investment Starting End No Project Name Value (IDR Developers KPI Period Period Billion) Main Economic Activities - Coal Coal mining exploration in Muara Wahau, 1 40.000 Private 2010 2015 Kutai Timur Kutai Timur

Coal Production Capacity Improvement, PT 2 1.410 Private 2010 2012 Kutai Timur Kaltim Prima Coal Coal Mining in Bangkalan Dayak village, Kec 3 Kelumpang Hulu, Kab Kotabaru, South 4.500 Private 2011 2012 Kotabaru Kalimantan 4 Coal mining in Serongga 1.170 Private 2014 2017 Kotabaru

5 Coal mining in Sungup Sembuluan 196 Private 2014 2017 Kotabaru

6 Coal mining in Bangkalaan 196 Private 2014 2017 Kotabaru NPLCT (North Pulau Laut Coal Terminal) - 7 378 2010 2013 Kotabaru CBU (Continous Barge Unloader) Private Over Land Conveyor development in Kelanis 8 2.160 2010 2014 Barito and Crushing Plant development in hail road Private Metallurgical Coal development project 9 76.500 2012 2013 BHP Billiton (IndoMet Coal) Private 10 CPP OLC West Mulia 658 Private 2010 2013 Tanah Laut 11 Asam-asam CPP and OLC 460 Private 2010 2013 Tanah Laut Coal production and exploration in Coal in Tanah 12 100 2010 2016 Batulicin Private Bumbu Coal facilities development for upgrading plant 13 360 2008 2014 Balangan in haul road km 68 Private 14 Pit Crushing Conveyor (4 unit) 5.400 Private 2008 2014 Tabalong Main Economic Activities - Bauxite Bauxite Development and Bauxite/Alumina 1 7.220 Private 2010 2016 Ketapang Processing factory development Bauxite refinery and processing factory 2 10.000 SOE 2010 2015 Mempawah development: Smelter Grade Alumina Alumina CGA Factory Operations and SOE- 3 4.500 2009 2014 Sanggau Development in Kecamatan Tayan Hilir Private Main Economic Activities - Iron & Steel Iron ore refinery and processing facilities 1 1.200 2011 2015 Kotabaru development in South Kalimantan Private

Iron & Steel Making Plant (Iron-steel Industry 2 1.500 2011 2014 Tanah Laut development from basic form to iron crushing) Private

Basic Iron-Steel industry development in 3 100 2014 2016 Tanah Laut Kabupaten Tanah Laut, South Kalimantan Private

Infrastructure development for Batulicin Tanah 4 1.900 2011 2014 Industrial Zones Private Bumbu

B-1

Investment Starting End No Project Name Value (IDR Developers KPI Period Period Billion) 315,000 TPY Direct Reduction Rotary Kiln SOE- Tanah 5 1.381 2012 2014 Plant, Kalimantan Ironmaking Project Private Bumbu

Main Economic Activities - Palm Oil Palm oil plantation and raw vegetabble oil 1 149 2009 2012 Kutai Timur industries in Kutai Timur Private

Palm oil plantation and raw vegetabble oil 2 142 2008 2013 Kutai Timur industries in Kutai Timur Private Palm oil plantation and raw vegetabble oil 3 159,5 2008 2013 Bulungan industries in Bulungan Private Added Value Enhancement by increasing the 4 volume of CPO derivatives product and 2.634 Private 2011 2015 Kotabaru packaging product

Palm Oil plantation areal development with 5 10.000 2011 2015 Kotabaru total of 200.000 Ha Private

Palm oil processing factory to convert to 6 1.200 2011 2013 Kotabaru cooking oil Private 7 Palm oil plantation and CPO factory 820 Private 2009 2016 Pontianak Palm oil plantation and raw veggetable oil 8 1.194 2007 2012 Kapuas Hulu industries Private Palm oil plantation and raw veggetable oil 9 1.194 2007 2012 Kapuas Hulu industries Private 10 Palm Oil factory development in Pamukan 53,5 SOE 2011 2012 Kotabaru Capacity enhancement of palm oil factory in 11 25,2 2014 2014 Tanah Laut Pelaihari SOE Tanah 12 CRF development in Batulicin 43,5 2011 2012 SOE Bumbu Additional investment for new palm oil plant in 13 88 2011 2013 Sanggau Sanggau SOE Palm oil factory enhancement capacity in 14 20 2011 2013 Sanggau Rimba Belian SOE Palm oil factory enhancement capacity in 15 20 2011 2011 Landak Ngabang SOE Palm oil factory enhancement capacity in 16 24 2011 2011 Landak Kembayan SOE Additional investment of the new palm oil plant 17 101,7 2011 2013 Landak in Landak SOE Main Economic Activities - Oil & Gas Indonesia Deepwater Development (IDD) Rapak dan 1 70.000 Private 2014 2017 Project in Rapak dan Ganal Ganal

Bottom up grading to add up the production 2 capacity of fossil fuels, non-fossil fuels and 6.000 SOE 2011 2015 Balikpapan petrochemicals in Refinery Unit 5

Gas pipeline development from Simenggaris 3 330 Bulungan to Methanol refinery in Bunyu SOE

Management of open access centralized 4 4.400 2012 2015 crude terminal in Lawe- lawe SOE Paser Utara Main Economic Activities – Timber

Timber-cutting processing factory 1 7.294 Private 2011 2015 Berau development (IPHHK) in Berau Industrial Plantation Forest development in Kutai 2 5.250 2011 2012 Kutai Kertanegara Private Kartanegara

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MP3EI Planning Information in Kalimantan Economic Corridor

Investment Starting End No Project Name Value (IDR Developers KPI Period Period Billion) Industrial Plantation Forest development in 3 349,95 2009 2013 Sukamara Sukamara Private Industrial Plantation Forests development in 4 1.291 2008 2013 Ketapang Pontianak, Ketapang Private Industrial Plantation Forests development in 5 715 2011 2015 Ketapang Ketapang and Kayong Utara Private Industrial Plantation Forests development in 6 100 2011 2012 Ketapang Ketapang Private Timber-cutting processing factory Kotawaringin 7 893 2009 2013 development (IPHHK) in Kotawaringin Barat Private Barat Industrial Plantation Forests development 2nd 8 44,96 SOE 2010 2014 Kotabaru Rotation 14.624 ha Primary Industrial Plantation Forests 9 120,87 2010 2014 Kotabaru development, 12.769 ha SOE Industrial Plantation Forests development in 10 178,65 2012 2014 Banjar Banjar SOE Rubber Industrial Plantation Forests Murung 11 21 2012 2012 development in Santilik and Puruk Cahu SOE Raya Industrial Plantation Forests development in 12 126 2012 2016 Tanah Laut Pelaihari SOE Main Economic Activities - Copper Copper smelter and processing factory 1 12.000 Private 2009 2013 Bontang development in Bontang Main Economic Activities - Food Agriculture 1 Food estate in Bulungan 655 Private 2011 2014 Bulungan 2 Food estate in Pontianak 105 Private 2011 2014 Pontianak Main Economic Activities - Others Tourism destination development for Derawan 1 150 2011 2015 Berau and Tanjung Batu islands Private Tourism destination development for Parai Kutai 2 100 2011 2015 Kumala - islands Private Kartanegara Primary macro single nutrient artificial fertilizer 3 10.500 2012 2016 Kutai Timur industries in Kutai Timur Private 4 Pabrik EGAN Factory development 342 Private 2007 2012 Bontang 5 Nitrate Ammonia factory development 3.150 Private 2006 2013 Bontang Mining, factory development, Mangaan 6 processing and smelter development in 850 Private 2009 2015 Bengkayang Betung river Rubber Industry Forests development (1000 7 41,9 SOE 2010 2013 Kotabaru ha) Pupuk Kaltim 5 (fertilizer) factory development 8 6.100 SOE 2011 2013 Bontang in Bontang *) SOE = State-Owned Enterprise (BUMN)

B-3

B.2 List of Main Planned Infrastructure Projects

No Main Planned Infrastructures Developers Description 1 Road: Sekadau-Sanggau Tayan Ministry of Public Works Length 263,8 km 2 Tayan Bridge Ministry of Public Works Length 3 km 3 Steam Powerplant in Sampit PT. PLN Capacity 2 x 25 MW 4 Road: Sampit-Pangkalan Bun-Runtu Ministry of Public Works Length 277,6 km 5 Tanjung Ayun Bridge Local Government Length 3 km PT. Pelindo III & Ministry of 6 Sea Port Batulicin Transportation 7 Road: Tenggarong-Samarinda Ministry of Public Works Length 408,2 km

8 Steam Powerplant in Balikpapan Bay PT. PLN Capacity 2 x 110 MW

9 Sepinggan Airport, Balikpapan PT. Angkasa Pura I Operated in 2012 BPJT- Ministry of Public 10 Express Way Samarinda-Balikpapan Length 99,02 km Works 11 Maloy Port Ministry of Transportation International Airport Railway : Puruk Cahu-Bangkuang- 12 Ministry of Transportation Length 290 km Mangkatip

13 Road: Tanjung Selor--Maloy Ministry of Public Works Length 523 km 14 Bangkanai Steam Powerplant PT. PLN Capacity 280 MW

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MP3EI Planning Information in Kalimantan Economic Corridor

B.3 List of KPI and its Allocation for Economic Activities

Zones of Investment No Allocation/Designation Province Focus 1 Balikpapan Timber, Oil & Gas East Kalimantan 2 Berau Timber, Palm Oil, Coal, Tourism East Kalimantan

3 Kutai Kartanegara Timber, Palm Oil, Oil & Gas, Tourism, Pulp East Kalimantan 4 Kutai Timur Coal, Timber, Palm Oil, Fertilizer East Kalimantan 5 Rapak and Ganal Oil & Gas East Kalimantan 6 Kutai Barat Timber, Palm Oil East Kalimantan 7 Bulungan Timber, Palm Oil, Food Agriculture, Oil & Gas North Kalimantan Copper, Fertlilizer, Nitrate Amonium, Basic 8 Bontang East Kalimantan Chemical Industry 9 Penajam Paser Utara Oil & Gas East Kalimantan 10 Banjar Timber, Palm Oil South Kalimantan 11 Kotabaru Timber, Coal, Iron-steel, Palm Oil, Rubber South Kalimantan 12 Murung Raya Coal, Palm Oil Central Kalimantan 13 Pontianak Timber, Palm Oil, Food Agriculture, Oil & Gas West Kalimantan 14 Ketapang Timber, Palm Oil, Bauxite West Kalimantan 15 Kotawaringin Barat Timber, Palm Oil, Iron-Steel Central Kalimantan 16 Kotawaringin Timur Palm Oil, Timber Central Kalimantan 17 Kapuas Palm Oil, Timber, Food Agriculture Central Kalimantan 18 Tanah Laut Iron-steel, Coal, Timber, Palm Oil South Kalimantan 19 Tanah Bumbu Timber, Iron-Steel, Coal, Palm Oil South Kalimantan 20 Tabalong Coal South Kalimantan 21 Balangan Coal South Kalimantan 22 Barito Coal, Palm Oil Central Kalimantan 23 Sanggau Palm Oil, Bauxite West Kalimantan 24 Sintang Timber, Rubber West Kalimantan 25 Kapuas Hulu Palm Oil West Kalimantan 26 Lamandau Palm Oil Central Kalimantan 27 Katingan Palm Oil Central Kalimantan 28 Sukamara Timber, Palm Oil Central Kalimantan 29 Seruyan Palm Oil Central Kalimantan 30 Sambas Palm Oil, Timber West Kalimantan 31 Kubu Palm Oil West Kalimantan 32 Landak Palm Oil, Timber West Kalimantan 33 Melawi Palm Oil, Timber West Kalimantan 34 Penajam Paser Palm Oil East Kalimantan 35 Bengkayang Palm Oil, Mangan West Kalimantan 36 Mempawah Bauxite West Kalimantan 37 Other KPI Timber, Palm Oil, Coal, Iron-Steel, Bauxite others Source: Kemenko Perekonomian, 2013

B-5

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APPENDIX C – Scoping Matrix

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Scoping Matrix

C Scoping Matrix

C.1 Mining (Including Oil & Gas Drilling)

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification

Receptors lative of Strategic Issue u

mate required

Related

Cli

Change

Potential Planning

Conflicts

WideScale Cum

Environmental Quality

Particular risk of wide scale pollution Potential massive territorial expansion of mining discharges to Mahakam, Barito, and areas – e.g. Kota Baru regency and existing coal Batulicin River systems. mines present there – may lead to physical (-) (-) Further analysis regarding the estimation of Yes disturbance to surface / underground water flows potential future impacts from overall mining (watershed wide) development to watersheds in Kalimantan is needed. Water Areas of concern: similar to above location Pollution and contamination of water from tailings leakages and waste water discharge in the area of Extension of already existing extensive Kota Baru. coal base in Kota Baru regency (e.g. Pulau (-) (-) Laut island) Yes Potential effects of tailings and coal disposal (intentional or accidental) directly to sea Further analysis regarding the estimated water/coastal areas risks of the water pollution in the mining concession areas is required.

C-1

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification

Receptors lative of Strategic Issue u

mate required

Related

Cli

Change

Potential Planning

Conflicts

WideScale Cum

Possible concerns regarding waste water Provisions for safety and sound discharge from Oil & Gas activities (e.g. water environmental management of oil & gas (-) treatment from maintenance of the infrastructure), processing operations needs to be ensured however these can be addressed at a project level. at the project / EIA level.

Considering the scale, and cumulative effects (combination with heavy industry and energy generation), the issue is of strategic importance. Air emissions resulting from mining and raw material handling operations – particularly dust Of particular impacts to Kota Baru regency particles. Potential clustering with other existing (-) (-) (Pulau Laut), Tanah Bumbu and Tanah Yes mining activities, the produced emissions can Laut Regency Air & Climate cause impacts to regional air quality. Potential risk of increased emissions from local burning in households (burning of coal collected by local poor population) should be investigated further.

Increased GHG emissions from peat land degradation (particularly CO2 and CH4 from the (i) (i) (-) See details below regarding Forest peat drainage and deforestation.

C-2 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification

Receptors lative of Strategic Issue u

mate required

Related

Cli

Change

Potential Planning

Conflicts

WideScale Cum

Additional analysis of whether increase in atmospheric emission will lead to unacceptable air quality at the project area of Bontang needs to be conducted Oil & Gas related air polluting emissions (e.g. NOx,

SO2 and others) from new project expansion in (-) (-) The analysis should also result in Yes Bontang in area, with already low air quality. recommendation if the likely impacts can be adequately dealt with at the project / EIA level.

Land-use conflicts of mining concessions Large scale land up-take will result from expansion and Timber and Palm oil developments of mining operations (including tailings deposition). (conflicts of MP3EI planning and provincial Continuation of inconsistent and irregular planning, e.g. Central Kalimantan (-) (-) (-) Yes application of the ex-post management and control Province) of mining sites (reclamation)

Land & Soil Although there are no pinpointed projects in peatland areas (only existing concessions), there is a risk of the land subsidence from future mining projects and related drainage of peat covered Particular areas are Kendawang areas development. (-) (-) (-) watershed, Barito watershed and Kapuas Yes watershed.

C-3

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification

Receptors lative of Strategic Issue u

mate required

Related

Cli

Change

Potential Planning

Conflicts

WideScale Cum

Ecosystems

Deforestation resulting from the surface mining expansion. Overall MP3EI policy can lead to wide- scale deforestation through a number of relatively Conflict between the mining and palm oil ‘small’ mining plots. permits and conservation areas conflict Although there are no specific MP3EI mining (-) (-) (-) (-) Locations widely spread in overall projects in the forests area, existing mining Kalimantan concession areas (incl. palm oil concession) and the MP3EI mining strategy may continue to Forest & others contribute to deforestation/forest fragmentation.

Areas of concern: areas adjacent to Singkawang city and (West Kalimantan) where peat areas are apparent. Peatland degradation due to coal mining (-) (-) (-) (-) development on peat forests by draining the peat. Spatial analysis of forest / peat land area to be likely affected both by existing concessions and potential MP3EI projects is needed.

Risk of increased impacts from additional major MP3EI offshore drilling and mining project – Particular areas concentration of impact resulting from (i) direct destruction of habitats and along the coast of Kotabaru regency, Tanah disturbance of ecosystems (mangroves, coral), and Bumbu, . Coastal Areas (ii) secondary impacts through changes in water (-) (-) Yes quality due to accidental spilling, discharge of Analysis of likely cumulative impacts from wastewater (e.g. acid water runoff can change the existing concessions and potential MP3EI pH of the coastal water and present disturbance to projects is needed. coastal ecosystem).

C-4 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification

Receptors lative of Strategic Issue u

mate required

Related

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Change

Potential Planning

Conflicts

WideScale Cum

Downstream Oil & Gas developments adjacent (plants – settlements - urbanization, servicing Relevant for area adjacent to the coast of infrastructure developments) will further (-) ? (-) Yes Buntang exacerbate the negative impacts on coastal ecosystems Conflict of mining concessions with Direct disturbance and loss of biotopes from the conservation areas and sensitive habitat. mining areas expansion; and fragmentation of Particular areas in Ketapang regency, biotopes Melawi and Sintang regency (corridors of Mining and oil & gas offshore exploration can important species located) cause degradation of environmental quality (marine Areas of concerns are affected coastal areas Biodiversity and terrestrial environments). These may lead to (-) (-) (-) (riverine and coastal waters) Yes stresses to surrounding sensitive habitat and Fragmentation of forest in association with critical important species that can contribute to the mining access roads loss of biodiversity. In coastal areas it can cumulate Further spatial analysis of likely conflicts with water pollution from other sources should result in recommendations towards (households, existing industries) the project / EIA level (i.e. what issues should be addressed at these levels)

Socio- economic Aspects

Increased employment opportunities, will increase Migrant population will constitute extra migrations and thereby increase the likelihood of (-) burden on existing underdeveloped health the transmissible diseases to the local residents. services

Human Health Health impacts from environmental degradation - ( Project-specific. Potentially important in related to mining (e.g. water pollution, atmospheric - Samarinda/ urbanized/populated areas emission etc) may be significant especially in (-) ) accumulation with impacts from other pollution In combination with heavy industries, it has sources (transport, improper waste management) ? potential cumulative effects

C-5

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification

Receptors lative of Strategic Issue u

mate required

Related

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Change

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WideScale Cum

Employment opportunities can contribute to the Poverty (+) alleviation of poverty

Former traditional livelihood will be impacted by the Risk of customary land-related conflicts influx of alternative culture and values brought by the migrant mining workers. Increased migrant (-) (-) Areas of concern: Kotabaru, Yes workers also create extra pressure on services

(water, sanitation, health, education).

In areas where mining activities take up customary land for its expansion or production, a clear risk of Spatial analysis of likely conflicts between land-use disputes and social conflicts with indigenous communities and both existing (-) (-) indigenous people are apparent. In cumulation with concessions and potential MP3EI other economic activities (e.g. palm-oil) the impacts development is needed may be wide scale. Livelihood MP3EI mining activities can open new employment opportunities and thus improve the livelihood of the Analysis of mining-related economic population, though this may benefited a few group (+) incentives, benefits and costs is needed. in the community as mining sector usually have more high-skilled workers.

MP3EI projects do not indicate any Illegal mining can be an important source of correlation with illegal mining. However, livelihood in some communities. Expansion of (-) artisanal and small scale mining usually is industrial mining can strip them of livelihood usually apparent in gold mining (relevant in West Kalimantan)

C-6 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

C.2 Heavy Industry (Steel, Copper, Bauxite, Mangan – processing & smelting, and Oil & Gas processing)

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification Receptors of Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideScale Cumulative

Environmental Quality

MP3EI heavy industry activities in Kalimantan will Analysis of likely impacts of acid leaching involve the discharge of large amount of waste to water sources from the potential MP3EI water (often containing toxic & polluting development compounds) Potential problem of capacity of Definite cumulative impacts in association with wastewater treatment facilities. The other activities, palm oil and mining concessions. integrated system for handling the water in Additional heavy industries and the related water technological process (including final discharges can lead to cumulative non- treatment) should be required at the project compliances with water quality guidelines standard (-) (-) level (EIA, project design approval) Yes (Palm oil processing have the impacts of nutrients discharge to surface water). Risked area: Kotabaru regency (Pulau Water Laut), Tanah Bumbu regency, Kutai Timur Regional wide risks from the breach of tailing regency, Balikpapan city plus West ponds particularly from bauxite and coal processing Kalimantan, Mahakam delta areas to the water quality There is a study by USAID regarding The MP3EI industrial development can further coastal management of Balikpapan bay, worsen already poor water quality in Balikpapan may be available in PKSPL Bogor) Bay (with existing siltation issue).

Regional wide risks from breach of tailing ponds (particularly bauxite and coal processing) to water Further spatial analysis of potential impacts (-) (-) bodies. However, looking this could be managed at to the watersheds is needed. the project-level.

C-7

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification Receptors of Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideScale Cumulative

Locations as similar to the above. Potential problem of capacity of water resources. The balance of water resources MP3EI heavy industry will increase pressure on (availability of water for other purposes and water resources as it will require large amount of (-) (-) human use) shall be ensured through the water. planning at the regional level (before the project level decision making is concluded) Further study on projections of water balance is required

MP3EI heavy industry will produce atmospheric emissions (e.g. SO2, NOX). In existing urban or industrialised areas, there is a clear risk of Kotabaru regency, Tanah Laut regency, cumulative impact. If these industries use their Kutai Timur regency and some areas in own power, coal will likely be the major source of West Kalimantan. power. (-) (-) (-) Risk of cumulative air quality impact to the local Scale of impacts would largely depend on residents in Balikpapan from combined activities technology and level of environmental Air & Climate from heavy industries and future power generations management of the facilities. and existing power generations and likely future traffic congestion.

High energy-intensive industries can trigger increased GHG emissions by creating high energy Emissions generated by power supply are demand which will be mainly satisfied by fossil- (-) (-) (-) fuels based energy. considered in the Energy sector

C-8 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification Receptors of Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideScale Cumulative

Soil uptake as a result of territorial expansion of the Kotabaru regency, Tanah Laut regency, industrial facilities can lead to soil degradation. Kutai Timur regency and areas in West However this risk should be addressed through (-) Kalimantan provincial / local spatial planning and at the project level (and related environmental assessments). Land & Soil Risk of soil contamination both in situ (from tailing ponds) and through toxic (atmospheric) deposition. Non-ferrous metals industry is associated Uncontrolled industrial landfills, in principle can (-) (-) with highly toxic emissions throughout the lead to potential wide-scale impacts to groundwater whole production process and soils quality but it can be managed in a project level.

Ecosystems

There is no direct strategic impact from heavy industry projects to forests, however secondary impacts in association with supporting infrastructure for these industries will have likely risks. This will be addressed in Connectivity section. Relevant only for the new pipelines – Bunyu

No major strategic impacts expected from Oil and island – Simmengaris block Forest & others Gas processing but possible risks fragmentation from pipelines is apparent., which however can be addressed at the levels of provincial spatial planning and project design (and relevant environmental assessments)

Substantive risk of increased pressure on forest Long-range pollution possible from acidic atmospheric deposition, however

C-9

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification Receptors of Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideScale Cumulative

analysis of likely air emissions coming from all Effects depends on resilience of ecosystems MP3EI development in Kalimantan to see possible (e.g. limestone bedrock areas less cumulative impacts is required vulnerable)

MP3EI energy generations use hydropower, there is potential likelihood to significant forest degradation.

MP3EI heavy industries will cause primary impact to coastal areas via emissions and disposal of East Kalimantan (Bontang and Balikpapan); wastes to coastal water which will lead to South Kalimantan (Kotabaru) and West Coastal Areas secondary impact on coastal degradation (e.g. (-) Kalimantan mangroves, sea grass and coral). Especially integrated industrial development around ports will have cumulative impacts.

Possible risks of contamination through wastewater Developments take place mostly in already from industries can lead to changes in the water degraded areas, nevertheless additional Biodiversity (-) ??? (-) Yes quality and thus negatively affect biodiversity in burden constitute a critical situation for aquatic ecosystems. certain sensitive species.

Socio- economic Aspects

Locations are similar with affected areas of High occupational health risks from smelting and air and water quality section. related industries in association with secondary impacts from water/air quality, however the impact Analysis of likely air emissions coming from Human Health (-) (-) Yes is more localized and can be dealt in project level. all MP3EI development in Kalimantan is Likely impacts to the population living around needed to estimate the likely overall MP3EI industrial sites will have larger scale too. impacts and its cumulation with other sources

C-10 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification Receptors of Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideScale Cumulative

Increased migrant workers in heavy industry Areas of concen: Balikpapan city, Bontang projects can cause risks in transmissible diseases (-) city, Tanah Bumbu and Kota Baru regency. for population adjacent to the industrial sites.

New employment opportunities can contribute to the alleviation of poverty, however further analysis Poverty (-) Yes regarding employment rate in industry is required to identify the scale of impact in regional level.

Increase of employment opportunities for certain professions in industry will change the former Locations in new urban/industrial areas in livelihood, taken together with other economic Tanah Bumbu and Kotabaru regency activities the impact may be cumulative. Possible Further economic analysis of costs and Yes loss of livelihood for certain communities (e.g. benefits related to industrial development on agriculture, tourism) in the vicinity of industrial regional level is needed sites.

Potential risks of limiting access to clean water for communities downstream of the industry due to Areas of concern are urban industrialised Livelihood pollution of water resources and/or depletion of areas in Tanah Bumbu and Kotabaru water resources (due to increased demand from (-) regency. More stresses may occur in industry). Balikpapan and Bontang city where existing Likely secondary impacts to human health are water quality is already poor. described in the respective section above.

Potential social conflict with indigenous people. Areas of likely affected: customary land and However, since the location of MP3EI industry indigenous community in Kotabaru, Barito (-) (-) (-) Yes projects are only indicative, it is hard to locate the Selatan, Ketapang and Landak regency. exact affected areas. Considering the future development under MP3EI EC planning in Further verification on delineation of

C-11

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations Potential Issues of Concern Verification Receptors of Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideScale Cumulative

designated node for coal mining, palm oil and designated node for coal, palm oil and timber timber activities, the impact would be significant as activities is required. they overlap with customary lands and areas of indigenous community.

C-12 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

C.3 Agro-forestry (Palm Oil, Timber)

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors Strategic Issue

ated required

Rel

Climate

Change

Potential Planning

Conflicts

WideScale Cumulative

Environmental Quality

Conversion of virgin land (forests, peat-lands) for Areas of concerns in association with peat palm-oil plantation especially in cumulation with conversion: Kapuas Hulu regency, Mahakam timber processing activities creates pressures on river and Kapuas river. available water resources and triggers changes in the hydrology regime. This can lead to local water Areas of concerns for Kotabaru, Kutai Timur, shortage especially in combination with climate- Bulungan change induced change in precipitations and the (-) (-) (-) (-) Yes Plantation developments compete with likes. Though the impacts from timber development conventional crops for water resources may not be as large scale as palm oil plantation, it is noteworthy to acknowledge the similar risks to Further analysis regarding water balance of water resources. relevant areas needs to be established to Water identify risk of water shortages.

Sambas river, and certain areas in West Water pollution from pesticides, fertilizers, Kalimantan sediments, and dissolved organic carbon from Areas of concerns for water shortage and plantations and wastewater from timber pollution related to timber processing: processing. The release of pollution from peat- (-) (-) (-) (-) Kotawaringin Barat (Central Kalimantan), Yes lands can also contribute to deterioration of water Berau (North/East Kalimantan). Water quality quality (peat-land disturbance). in those areas is already in poor condition due to illegal mining and other factors. Potential conflicts with other policy and

C-13

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors Strategic Issue

ated required

Rel

Climate

Change

Potential Planning

Conflicts

WideScale Cumulative

activities such as REDD+ and tourism development

Spatial analysis to identify the areas of concern is required Further study on the scale of likely amount of polluted waters and level of pollution (from timber processing) as well as location regarding the proximity to watersheds, is required

LULUCF related emissions of GHG are major contributor to the GHG of Indonesia. Development of new plantations on forests and peat-land needs to be in general Conversion of virgin land (forests and peat-lands) minimized and offset by effective mitigation for palm-oil plantation triggers LULUCF related measures, otherwise it conflicts with national GHG emissions (especially from peat-land CC related policy. burning). Likely impacts from timber development (-) (-) (-) (-) Areas of concerns: peat land areas in are of smaller extent, however the risks are Air & Climate Landak and Kapuas Hulu regency (MP3EI noteworthy. palm oil projects) Under MP3EI policy in Kalimantan EC, a node of oil palm development in (where peat areas are apparent) should also be considered as areas of concern.

Deterioration of air quality due to direct impact from (-) (-) (-) (-) Further analysis to identify peat fires Yes peat fires (in sensitive peat fires areas or activities

C-14 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors Strategic Issue

ated required

Rel

Climate

Change

Potential Planning

Conflicts

WideScale Cumulative

of burning the peat-land) leading to haze pollution sensitive areas is needed. to other neighbouring countries (i.e. Singapore, Malaysia)

Areas of concern: peat land areas in Landak Peat land degradation from drying, melioration and and Kapuas Hulu regency (MP3EI palm oil

burning practices of peat for palm oil resulting in projects); Kubu Raya regency (overlap of land subsidence. MP3EI node of palm oil activities and (-) (-) (-) peatland areas)

Soil degradation (pollution or erosion) in association with clear-cutting logging practices and (-) (-) Land & Soil intensive n agriculture techniques.

Locations are widespread, specific concerns Risks of unsustainable land management. Under are areas in West Kalimantan (Ketapang & MP3EI policy, strong planning initiative to utilize Kuburaya regency) where node of palm oil broad search of lands for palm oil can lead to (-) (-) (-) activities are planned. unproductive lands with less economic value in the Areas in Landak, Pontianak, Sanggau and future if it is not managed sustainably. Kotabaru regency are also of important concerns (MP3EI palm oil projects).

Ecosystems

Data from forest cover change shows that Exacerbation of existing deforestation trends deforestation mostly occurred in palm oil Further analysis regarding the forest cover Forest & others development areas. (-) (-) (-) (-) Yes change due to the palm oil/timber Therefore further forest conversion for palm oil and development is required (considering both timber development will drive large-scale existing concessions as well as possible

C-15

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors Strategic Issue

ated required

Rel

Climate

Change

Potential Planning

Conflicts

WideScale Cumulative

deforestation. If palm oil concession areas are fully M3PEI.driven development) utilized, the risks to forest habitat will be significant Location is widespread but further GIS in scale. analysis is needed to illustrate the risked deforestation areas.

Mangrove forests loss in association with logging for timber development (forestry products). This will Lumber mills excessive capacity contributes creates pressures on environmental quality on as major driver for mangroves loss in coastal ecosystem depending on mangrove (-) (-) Kalimantan context. Yes forests. Though the footprint produced from timber Further spatial analysis to establish location sector is not as significant as peat and palm oil of sensitive areas is required. plantations, the risks are noteworthy.

Secondary impact from draining peats in the coastal areas for palm oil will lead to the land Coastal Areas subsidence and thus increased risks of seawater (-) (-) intrusion can cause damages the coastal ecosystem.

Secondary impact of the water pollution in upstream area to coastal water quality. Combined Widespread in coastal areas (close with increased amount of river flows through rainy correlation between watershed affected by period, the impact will be cumulative in nature. On (-) (-) mining and palm oil plantation). the other hand, large flow may help to dilute the Further analysis of potential level of water concentration of pollutants down to the acceptable pollution (see above) is required. level.

Wide-scale deforestation in essential terrestrial Direct conflict with remaining intact Biodiversity biodiversity habitats leading to habitat destruction (-) (-) (-) biodiversity rich territories of World and fragmentation, (with direct impact on

C-16 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors Strategic Issue

ated required

Rel

Climate

Change

Potential Planning

Conflicts

WideScale Cumulative

endangered species) e.g loss of orang-utan due to importance logging and forest conversion. Locations of Orangutan habitat distribution in Central Kalimantan (Sebangau and Tanjung Putting National Parks) Some of endangered species include hornbill, proboscis monkeys, gibbons

Secondary impact to coastal biodiversity – due to mangroves conversion for timber as well as potentially due to increased water pollution in coastal waters. Of particular importance are species (both marine and terrestrial) relying on Spatial analysis is required to further (-) (-) Yes mangrove ecosystems. Other indirect impacts to determine sensitive locations. biodiversity may result from increased risks of poaching in newly opened areas and their accessibility via palm-oil / timber related infrastructure.

Socio- economic Aspects

Occupational health issues of plantation workers exposed to pesticides, however looking at the scale Not strategic it may not be of strategic importance.

Human Health Areas of concern: settlement areas adjacent Secondary impact from water pollution (e.g. to following river system, e.g. Kayan, Cengal, pesticide, fertilizers, dissolved organic carbon) to (-) Bangkalan, Batulicin and Kapuas River Yes main water sources for communities living adjacent Systems. to plantation areas and downstream. Further analysis on water quality on main

C-17

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors Strategic Issue

ated required

Rel

Climate

Change

Potential Planning

Conflicts

WideScale Cumulative

river system used for water supply is required

Customary land is partially recognized, Potentially large risk of conflict with traditional however its protection not enforced livelihood of rural communities, (subsistence (-) (-) (-) Areas of concern include customary land in Yes farmers, partially dependent of forest resources, Kotabaru regency and indigenous etc.) community in Pontianak, Landak and Ketapang regency.

Secondary impact from peat land drainage for palm Similar to areas of concern in peat land oil plantation which lead to peat land subsidence degradation section and increase the risks of flooding (due to sea water Yes intrusion) into urban/settlement areas adjacent to Further analysis of the scope of the likely the coast where major peat areas are located. impacts is needed. Livelihood Risks of depletion of the water resources due to conversion of virgin land (forests, peat-lands) for palm-oil plantation leading to pressures on available water resources and triggering changes Further spatial analysis of potentially affected in the hydrology regime (especially in cumulation (-) (-) (-) population is needed to determine Yes with timber processing activities). This can lead to significance and scope of likely impacts local water shortage especially in combination with climate-change induced change in precipitations and the likes.

Land-use conflicts in association with overlap of Locations are widespread. Key locations palm oil and mining concessions due to poor (-) (-) (-) (-) need to be established using extrapolation of Yes planning coordination. concession maps.

C-18 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

C.4 Connectivity – Infrastructure (including Energy generation)

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors icts Strategic Issue

required

Climate Related

Change

Potential Planning

Confl

WideScale Cumulative

Environmental Quality

Waste water discharges from in association with Likely affected areas: Tanah Laut regency, Water power generations will contribute to water pollution Kota Baru regency, Penajam Paser Utara, of the river systems. Kota Singkawang, Sambas regency

Increased atmospheric emissions that can affect the air quality from ports development and power generations. More considerations are required for

future industrial land-use around the new ports and Likely affected areas: similar to areas of Air & Climate (-) (-) location of the power plants regarding urban (-) water quality concerns (above) areas.. Coal based energy generation will also increase GHG emissions.

There seems to be no strategic impacts from Land & Soil connectivity infrastructure projects on land and soil.

Ecosystems

MP3EI planned roads cutting through protected forests or peat land areas will trigger a strong likelihood of land-use conflict between protected Areas of concern: Kutai National Park, Forest & others forests and infrastructure development. When this (-) (-) (-) (-) Forest areas in Kutai Timur and Kutai followed with other expected development in the Kartanegara regency vicinity of forest areas, it can lead to forest habitat fragmentation. Direct impact from footprints of the

C-19

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors icts Strategic Issue

required

Climate Related

Change

Potential Planning

Confl

WideScale Cumulative

forestry and the roadways itself to forest and other sensitive habitats.

Increased roadway access to formerly inaccessible Location of risked areas need to be areas leading to increased opportunity and (-) (-) established likelihood of illegal logging (forestry activities)

Impacts to coastal degradation from ports Risked areas in locations close to Pangkalan development and if some power plants planned Bun. adjacent to coastal areas. Not only newly Coastal Areas (-) constructed, but also upgraded roadways along the Risks to mangrove sensitive areas in coastal areas will contribute to disturbance to Pontianak city, Kotawaringin and Kutai Timur coastal ecosystem (e.g. mangroves) regency

Areas of concern: mangroves sensitive areas Secondary impacts to coastal biodiversity where as mentioned in coastal areas section; forest ports development are planned in/adjacent to coral and protected areas in Kutai Timur and Kutai or mangrove areas will put pressures on Kartanegara regency environmental quality, which may be critical for When road developments in protected areas species depending on coral/mangroves habitat. (-) (-) Yes are followed with residential settlement, it will Secondary strategic impacts to protected create pressures to environmental quality for Biodiversity (terrestrial) species due interaction of bio- sensitive/endangered species. corridors/fragmentation with wide scale impacts in correlation to endangered protected species. Further spatial analysis of potential conflicts is needed.

Increased roadway access to formerly inaccessible Areas of concern: forest areas adjacent to areas leading to increased opportunity and (-) (-) planned MP3EI roadways (East Kalimantan likelihood of illegal poaching and West Kalimantan)

C-20 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors icts Strategic Issue

required

Climate Related

Change

Potential Planning

Confl

WideScale Cumulative

Socio- economic Aspects

Areas of concern: coastal urban areas in Air and water pollution from infrastructure projects Bontang, Balikpapan, , Tanah (ports and power plants) is likely to have effects to Laut regency, Kotabaru regency (Pulau the public health of community living adjacent to Laut). the development areas. Such impacts will likely to (-) (-) be cumulative and wide-scale especially in areas Further analysis of air and water quality where clustered development (i.e. mining & heavy impacts is needed as well as spatial analysis Human Health industry) takes place. regarding locations of proposed development in proximity to settlements.

Ports development trigger urban industrial areas near coastline and drive increased migrant workers Areas of concern: Kotabaru regency, Tanah (-) with potential vectors of transmissible diseases Laut regency, Kota Samarinda (HIV/AIDS).

Improved mobility in the EC will open new employment opportunities. The impact however may not be strategic considering the majority of Poverty (+) population in Kalimantan still depending on agroforestry sectors and extracting industries usually employ more high-skilled workers.

As known, extractive industries (oil & gas Infrastructure developments provide better facilities Livelihood (+) and mining) is the major contributing Yes leading to potential increased wealth. sectors to regional GDP in Kalimantan. Majority of infrastructure development will

C-21

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of Potential Issues of Concern Verification Receptors icts Strategic Issue

required

Climate Related

Change

Potential Planning

Confl

WideScale Cumulative

increase employment from this sector. Further analysis on the main type of livelihood and contribution of improved infrastructure to regional disparity is required.

MP3EI planned roads cutting through protected forests or peat land areas will trigger a strong Areas of concern: protected forests as (-) (-) likelihood of land-use conflict with other economic mentioned in forest section. activities.

Potential social conflicts or disturbance to indigenous people where planned roadways/infrastructures take-up their customary Areas of concern: indigenous community (-) (-) lands or provide access to the formerly in Pontianak and Landak regency. inaccessible areas with high cultural conservation value.

Potential loss of livelihood due to exploitation (deforestation) or losses of the natural resources (e.g. pollution of coastal waters can lead to losses Further economic analysis considering (-) ??? (-) Yes of fish stocks) for local communities (fishermen, major environmental risks is needed small farmers, indigenous forest-depending communities)

C-22 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

C.5 Others (Tourism, Fertilizers, Food Estates)

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of

Potential Issues of Concern cale Verification Receptors Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideS Cumulative

Environmental Quality

Increased demand for irrigation of agriculture activities in food estate area and tourism activities Areas of concern: Bontang, Kutai Timur (i.e. hotels) creates pressure on available water regency resources. The impact may only be project-specific, (-) (-) Yes however cumulative with other development Further analysis of possibility of cumulative (industry, palm-oil) affecting water resources. . impacts is required.

Water

Underground waters and water bodies’ contamination/pollution due to the waste from fertilizers industry. If the wastewater treatment is (-) (-) insufficient in area where tourism development are planned, possible risks of water pollution may occur.

Increased traffic (from transportation) to tourism destination and associated waste burning activities Areas of concern: Bontang, Kutai Timur Air & Climate (-) (-) will likely affect the air quality in tourism regency development area.

Risk of soil pollution and contamination from pesticides and fertilizers due to fertilizer industry Land & Soil development as well as through nutrients deposition.

C-23

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of

Potential Issues of Concern cale Verification Receptors Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideS Cumulative

Uncontrolled industrial landfills, in principle can lead to potential impacts to groundwater and soils quality but it can be managed in a project level.

Ecosystems

Potential localized impacts from tourism activities Forest & others though it contributes only small footprints in the (-) deforestation issues

Potential localised impacts on costal ecosystem - due to direct destruction of the coastal ecosystems ( coral, mangroves, seagrass) and through Coastal Areas (-) increased pollution of coastal waters (e.g. due to tourism development and insufficient waste water management systems)

Potential primary impact from physical disturbances. – tourism activities (diving, boat trips) + anything else? Secondary impacts from coastal Biodiversity (-) and oceans degradation as a result of ???? could have cumulative impact to the protected biodiversity in EC.

Socio- economic Aspects

Secondary impacts from tourism migration leading Areas of concern: Bontang, Kutai Timur Human Health (-) to possibility of diseases vectors (i.e. TBs, AIDS) regency

Poverty Potential increased wealth from tourism activities (+) Areas of concern: community living in

C-24 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Scoping Matrix

Strategic Risk/Opportunities Categories

Further Sustainability Further Explanation & Likely Locations of

Potential Issues of Concern cale Verification Receptors Strategic Issue

required

Climate Related

Change

Potential Planning

Conflicts

WideS Cumulative

may lead to reduced poverty rate but probably only surrounding Derawan & Tanjung Batu relevant for particular groups (community living islands. near tourism area). Impacts may be however limited only to population living adjacent to development sites.

Decreased access to clean water and sanitation due to waste from tourism activities – this is more Livelihood probable then the one below (-) Potential impacts on conflicts with the local culture in the community

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C-26 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

APPENDIX D – Stakeholder Consultation

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SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Stakeholder Consultation Meeting

D Stakeholder Consultation Meeting

D.1 List of Attendees at Stakeholder Consultation

Day 1 – 18 March 2014 No Name Institution/Organisation 1 Henny Magdalena Universitas Mulawarman 2 Eddy Thamrin Universitas Tanjungpura MoHA – Directorate General for Regional 3 Sondang L G Development 4 M Teddy Setiadi PIC Ministry for Kalimantan – Ministry of Agriculture 5 Astria Hernisa PIC Ministry for Kalimantan – Ministry of Agriculture 6 Rahmiyanti Bappeda Provinsi Kalimantan Selatan 7 A Ristanto PPE Kalimantan 8 Esau A Tambang BLHD Provinsi Kalimantan Tengah 9 Arif Wardani BLHD Provinsi Kalimantan Selatan 10 Didit Wahyudi Bappeda Kabupaten Katingan 11 Astu Gagono Bappenas 12 Humala Pontas BLHD Provinsi Kalimantan Tengah 13 Timothy Jessup GGGI 14 Syarifuddin Kadir Universitas Lambung Mangkurat 15 Tim Mac Hansen Royal Danish Embassy 16 Sugeng Raharjo Flora Fauna International – Indonesia Program 17 Wiwin Effendy WWF 18 Rahmat S Jaringan Kerja Pemetaan Partisipatif (JKPP) 19 Montty Giriana KP3EI Connectivity Working Group - Bappenas 20 Nizhar Marizi KP3EI Connectivity Working Group - Bappenas 21 Jevelina Punuh IFACS 22 Erlina D Kementerian Lingkungan Hidup (KLH) 23 Isluyandri KLH 24 Roby Dwiputra KP3EI Connectivity Working Group – Bappenas 25 Fahmi Himawan BLHD Provinsi Kalimantan Timur 26 Sri Oka Rachmadita Bappenas 27 Sugito Said Bappeda Provinsi Kalimantan Selatan 28 Ariadi Noor Bappeda Provinsi Kalimantan Selatan 29 Hasbi Berliani Kemitraan/Partnership for Governance Reform 30 Taswin Munier DANIDA ESP3 31 Nanda Ratna A KP3EI Connectivity Working Group – Bappenas 32 Wayan Deddy NS KP3EI Connectivity Working Group – Bappenas 33 Afrike WS Kemenko Perekonomian 34 Hakimatul M Kemenko Perekonomian 35 Heri Herdiansyah Kemenko Perekonomian 36 Ikrar Eka PG Kemenko Perekonomian 37 Budi Nugraha Bappenas 38 Achmad Daraja Bappenas 39 Mochammad Ikbal Bappenas

D-1

Day 2 – 19 March 2014 No Name Institution/Organisation 1 Trine Bargsteen DANIDA ESP3 NCU 2 Kurnya Boesad CCCI 3 Heri Susanto PPE Kalimantan 4 Peter Oksen DANIDA ESP3 NCU 5 Silva Bertus Coni Bappenas 6 Rahmiyanti BappedaKalsel 7 A. Ristanto PPE Kalimantan 8 Esau A. Tambang BLH Prov. Kalteng 9 Arif Wardani BLHD Prov. Kalsel 10 Didit Wahyudi Bappeda Kab. Kaltim 11 Henny Magdalena Universitas Mulawarman 12 Eddy Thamrin Universitas Tanjungpura 13 Wiwin Effendy WWF 14 Rahmat S JKPP 15 Jevelina Punuh IFACS 16 Erlina D KLH 17 Isluyandari KLH 18 Fahmi Himawan BLHD Provinsi Kalimantan Timur 19 Sri Oka Rachmadita Bappenas 20 Ariadi Noor Bappeda Provinsi Kalimantan Timur 21 Hasbi Berliani Kemitraan 22 Taswin Munier DANIDA ESP3 NCU 23 Wayan Deddy N.S KP3EI Connectivity Working Group – Bappenas 24 Afrike W.S Kemenko Perekonomian 25 Hakimatul M. Kemenko Perekonomian 26 Heri Herdiansyah Kemenko Perekonomian 27 Ikrar Eka P.G. Kemenko Perekonomian 28 Sugeng Raharjo Flora Fauna International – Indonesia Program 29 C CSDMSW Bank Dunia 30 Humala Pontas BLHD Provinsi Kalimantan Tengah 31 Syarifuddin Kadir Universitas Lambung Mangkurat

D-2 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

D.2 Copies of Attendance of Scoping Workshop/Stakeholder Consultation

D-3

D-4 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

D-5

D.3 Minutes Meeting of Stakeholder Consultation

MP3EI SEA

Minutes of Meeting

Date: 18-19 March 2014 Meeting: SEA MP3EI Scoping Workshop for Economic Corridor (Kalimantan EC) Time: Attendees: As attached Venue: Grand Kemang Hotel, Absent : - Jakarta

Issues Action/Remarks Day 1 – 13 March 2014 1. Introduction As attached in  Opening speech from KP3EI Connectivity Working Group Bappenas presentation  Round Introductions of participants  Objectives of the workshop 2. Review of General and MP3EI SEA Processes 3. SEA Scoping Principles and Methods  Purpose  Common Approaches and Limitations  Scoping Examples  MP3EI Approach 4. Hands-on Scoping Exercise  Definition of Strategic Issues  Application of Scoping Matrix  Example of how to use GIS Database  Execution of hands-on scoping MP3EI Cases 5. Wrap up/ Closing

Questions & Feedbacks Bappeda Kalimantan Tengah All to note - Concern over updated data over permits issued for palm oil concession and selection criteria used to propose the MP3EI projects has not considered the land suitability (soil category) for palm oil plantation - Suggested to also look at the upstream sectorial and ministry’s PPP and not only the projects for the analysis Bappeda Kalimantan Selatan All to note - Request to provide preliminary/initial reading of the reports (prescoping) so they will be more prepared BLH Kalimantan Selatan All to note - Most rivers in South Kalimantan are already heavily polluted from mining, agriculture activities and domestic waste. - Data of water quality monitoring is available Syafruddin – Universitas Lambung Mangkurat All to note - Suggested to also use the data/studies of watershed management in South Kalimantan - Batulicin watershed has been determined as prioritised area for integrated watershed management initiatives. Data is available in Ministry of Forestry - There are three important watersheds in South Kalimantan affected from economic activities: Satui, Batulicin and Kusan Day 2 – 14 March 2014 Agenda As attached in • Introduction presentation • Review of the Definition of Strategic Issues • Review of Baseline Information & Autonomous Planning

D-6 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Issues Action/Remarks • Presentation of Findings − Approach to Expert Scoping − Illustration of EC SEA Scoping findings − Discussions and Q-A session • Lunch • Continued: EC SEA Scoping Findings and Discussion • Preliminary Recommendations • Plenary Session • Next Steps in MP3EI Discussion and Q-A session for presentation of findings Samarinda, Balikpapan and Bontang Hotspot

Wiwin (WWF) - Concern to consider individual project with cumulative and wide scale impact such as KIPI Maloy (industrial zone and international port) in East Kalimantan. - Potential conflict with forest conversion for road development to the port (KIPI Maloy) as well as potential natural capital loss (i.e. biodiversity) - Suggest to include offshore oil and gas production in the coastal ecosystem impacts Heri (PPE Kalimantan) - To adopt or use the information in the report for Greening MP3EI developed by KLH - Suggested to develop more specific/ detail baseline information (location or areal of land degradation, water pollution etc) as well as measurable further analysis. Hasbi Berliani (Kemitraan) - Suggested to include the social conflict cases from secondary sources not only the spatial data of the indigenous people distribution - To include the issues of overlapping of land-use permit as Kalimantan is one of the prominent area due to this overlapping of land-use (no Provincial Spatial Plans are finalised) Pak Fahmi (BLH Kalimantan Timur) - Concern over contradiction between MP3EI policies and Central Government policies. A proposed pipeline (out of MP3EI) will be developed to distribute the energy production from Kalimantan to Java island. This creates concern as Kalimantan itself already experiencing risks in energy supply. - Concern over proposed toll road from Balikpapan-Samarinda that will conflict with Forest Park in East Kalimantan (no spatial plan has been finalised for this protected areas)

Kotabaru and Tanah Bumbu regency Hotspot

Pak Ariadi (Bappeda Kalimantan Selatan) - To use the primary data and valid information as the recommendation will be suggested for RPJMN that may affect the PPP in RPJMD Pak Humala Pontas (BLH Kalimantan Tengah) - To not focus on the projects (spatial) location of MP3EI but also possibilities of other activities within the MP3EI policies (e.g. cooking coal industries in South Kalimantan) - Suggested to include flood risks issues in the analysis - Suggested to include the forest moratorium map into the analysis with other existing activities and MP3EI planning in the EC Rahmat (JKPP) - New indicative customary land maps have been updated with additional area of 52 ha. Suggested to include the new updated area into the analysis

Central Kalimatan Hotspot

Pak Syafruddin – Universitas Lambung Mangkurat - Concern over extreme landscape differences in Central Kalimantan. Impact from upstream forest ecosystem to the peat land ecosystem should be included in the analysis

Pak Umar (BLH Kalimantan Tengah) - Concern to consider watershed management issues in integrated and holistic view, as some watershed in Central Kalimantan sometimes affected from the

D-7

Issues Action/Remarks upstream activities in West Kalimantan and vice versa. - Concern over permits issuance for MP3EI projects in protected areas - Concern over secondary impact from upstream activities (i.e. palm oil, industries) to coral reef in the coastal area of Sukamara regency

Further comments/feedbacks on overall findings

- To include groundwater regime within water quality analysis - Recommend rehabilitation/reclamation as mitigation measures for mining activities - To include impact from emissions in physio-chemical parameter - To consider issue of freshwater fish stock from upstream economic activities in socio-economic impacts - To include the water quantity (resources) concern in the watershed management measures impacted from mining activities (also relevant for processing/heavy industries) - Recommend integrated watershed management as stipulated in the PP No 39 of 2012

Discussions and Q-A for Preliminary Recommendations Agroindustry sector - Recommend to strictly stop forest conversion but to utilize the existing deforested/degraded land for palm oil activities - Specifically for East Kalimantan to address the issue of water supply management and protection of agricultural (food-agriculture) land-use from conversion into plantation. - To include the latest forest land-use in East Kalimantan, referring to Ministry of Forestry’s Decree SK No 92/2012 as amendment to SK No 554 of 2012 - To also include requirement of carbon stock replacement (compensation) for peat land areas converted for palm oil activities - To propose application of ISPO (Indonesian Sustainable Palm Oil) principles for palm oil production instead of RSPO Mining sector - Suggested to also consider the issue of mining permits management regarding to ‘borrowed and used’ system for small-scale mining. Concern over manipulative practices by large scale mining companies to divide their mining activities into small-scale mining so no AMDAL is needed. - Mining activities with PKP2P permits (increase of mining production). To also include the strict requirement of post-mining management measures (East Kalimantan Regional Regulation/Perda states to require the mining companies to undertake revegetation as of 70% of total forest cleared for mining activities) - Include new energy and renewable energy resources as strategic issues and to be addressed in the recommendation - To also include the Kalimantan island spatial plan and Heart of Borneo spatial plan in relation to potential conflict with mining activities or other economic activities

Heavy Industry sector - Suggested to put recommendation related to water supply for industrial activities - To improve the selection criteria for site/location-identification for industrial zones/ activities. Social Issues - Suggested to put recommendation for developing/strengthening equal partnership scheme with the indigenous communities by acknowledging their indigenous rights. - Propose recommendation for issuance of industrial concession or other activities that conflict with customary lands (mining, palm oil etc) to consider the indigenous rights stipulated by Constitution Court (Putusan MK No. 35/2012 regarding Customary Forest)

D-8 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

D.4 Activity Photos

Montty Giriana, Head of KP3EI Connectivity Working Group officially opened the workshop

Tim MacHansen (left), representative from Royal Danish Embassy Jakarta, accompanied by Martin Smutny gave his opening speech at the workshop

D-9

Situation during the scoping workshop in day-1

Participants at the scoping workshop

D-10 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05

Sondang LG, representative from MoHA delivered her feedbacks at the workshop

Ariadi, Head of Bappeda Kalimantan Selatan, delivered his feedbacks at the workshop

D-11

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D-12 SEA for Indonesian Master Plan for Accelerated Economic Development (MP3EI) / Scoping Report / JVB / 2014-05