Tourism threat: The Raja Ampat island chain in Indonesia. Covering a marine conservation area of roughly two million ha, Raja Ampat is a top destination for diving enthusiasts because of its stunning undersea landscapes. — Skyscanner
JAKARTA: The Indonesian Hotel and Restaurant Association (PHRI) has expressed concern over potentially adverse impacts on the country’s tourism industry from a nickel project in the Raja Ampat regency, Southwest Papua.
State-owned miner PT Aneka Tambang (Antam) purchased stakes in a smelter-owned by PT Jiu Long Metal Industry, a subsidiary of global nickel giant Eternal Tshingshan Group of China, a move many fear could expedite mining activities and harm to environmental damage on Gag Island in the Raja Ampat island chain, a so-called super priority tourism destination at the heart of the Coral Triangle.
Antam subsidiary PT Gag Nikel acquired 30% shares in Jiu Long worth US$102mil, it said in an exchange filing on Oct 7, Reuters reported.
Gag Nikel operates a mine on its namesake island in the Raja Ampat Islands that is estimated to contain over 42 million dry tonnes of nickel ore reserve, according to Antam’s annual report last year.
The mine also contains the company’s third-largest limonite and saprolite reserves.
The company, which started operations in 2018 after obtaining a work contract in 1998 and an environmental permit in 2014, has an operating licence that covers the entirety of Gag Island, which is categorised as a protected tropical rainforest.
PHRI chairman Hariyadi Sukamdani said that while the project was expected to have a positive impact on local hotels in cities like provincial capital Sorong by increasing accommodation demand and business opportunities, but he doubted the same could be said for tourism in Raja Ampat.
“If it is related to tourism, stakeholders must be careful about the environmental impacts, because like it or not, mining will damage the surrounding nature,” he told The Jakarta Post on Nov 4.
“We cannot just put our attention on generating profit. We must protect the environment, too,” Hariyadi said.
The regional branch of Greenpeace International has echoed the hotel association’s environmental concerns in relation to the Gag Nikel mine.
“We are concerned that Antam’s move to purchase shares in the Tsingshan Group’s nickel facility indicates that the company will expedite nickel ore mining on Gag Island,” Arie Rompas, forest campaign team leader at Greenpeace South-East Asia, told the Post on Tuesday.
Antam did not immediately respond to requests for comment.
Covering a marine conservation area of roughly two million ha, Raja Ampat is a top destination for diving enthusiasts because of its stunning undersea landscapes.
Last year, the regency attracted around 20,000 domestic and foreign visitors, according to Statistics Indonesia (BPS) data.
Gag Island is located five km outside Raja Ampat Marine Park, but damage to its ocean ecosystem could have a wider impact on the protected area as a whole, Kompas.com reported in 2022.
Indonesia is at a juncture of protecting the environment and scaling up nickel production to meet skyrocketing demand for electric vehicle batteries and clean energy.
Despite having the largest nickel reserves and being the largest nickel producer in the world, Indonesia has imported a record amount of nickel from neighbouring countries like the Philippines and Australia to meet demand from its smelters, which has been rising in number over the past years.
In 2023, South-East Asia’s largest economy imported 374,468 tonnes of nickel ore valued at US$16mil, according to the BPS’ foreign trade data.
Ahmad Zuhdi Dwi Kusuma, a mining industry analyst at state-owned lender Bank Mandiri, said operating mines in protected forests should be a last resort, after other locations had been explored.
He noted that mining remained a “tricky business”, however, since many greenfields were located close to or within protected areas.
Experts said that easily accessible coastal deposits are mostly depleted, prompting miners to move their activities away from coasts and further inland, including into protected forests.
Consequently, the mining industry will have a greater impact on biodiversity and the environment, including water sources and the marine ecosystem.
“But if we want to be stringent about environmental protection, there should be no mining and (mineral) processing activities on land that is prioritised for nature conservation,” Mandiri’s Zuhdi told the Post on Nov 5.
He also suggested that the government could impose stricter supervision and expand sanctions to help mitigate the greater environmental impact of mining.
The Geological Agency estimated in 2022 that the country had 3.68 billion tonnes of saprolite reserves with 1.5% nickel content.
Based on this figure, the Indonesian Nickel Miners Association estimated that if domestic smelters processed 584.9 million tonnes of saprolite each year, the reserves would last only until 2029. — The Jakarta Post/ANN
