Assessment Report / Checklist Verified Legal - Sarawak

Transcription

1 Assessment Report / Checklist Verified Legal - Sarawak Organization Details Company :Ta Ann Holdings Berhad Ref #: G Address :Ta Ann Building, Level 4B, No. 6, Jalan Rawang, Sibu, Sarawak, Malaysia. Contact: Mr. Nicholas Ting Kang Hwa (Ta Ann Holdings Berhad - Senior General Manager) Mr. Ting Liong Wui (Hariwood Sdn Bhd Senior Camp Manager) Tel: / Fax: tingkh@taann.com.my / bts@taann.com.my Statement of Compliance GFS LVS # GFS 019 LVS Issuance Date 19 Sept 2014 Expiration Date 18 Sept 2015 Assessment Details Scope of Assessment Tanjong Manis Holdings Sdn Bhd (Forest Timber License # T/3491) 121,741 ha Legality Standard LVS 005a v06 Feb 2014 (Verification Standard for Sarawak, Malaysia) Assessment Dates July 2014 GFS Lead Assessor Kevin Grace GFS assessor & experts Jessie Ooi Organization Staff Nicholas Ting, Ling Ting Tchin, Ting Liong Wui Report Date 6 August 2014

2 Summary Information Overview of Licensee Organization Information: Ta Ann Holdings Berhad is a resource-based company Berhad in Sarawak, Malaysia. It was founded in the mid 1980 s as a small trading company by the main founders Datuk Abdul Hamed Bin Haji Sepawi, Datuk Wahab Bin Haji Dolah, and Dato Wong Kuo Hea and started as forest concession licensee, timber harvesting, shipping operations and downstream wood-based industries. Ta Ann Holdings Berhad was then incorporated as public limited company in February 1997 and listed on the main market of Bursa Malaysia on 23 November The principal activities of resource-based Ta Ann are centred around sustainable harvesting of timber resources and value adding downstream activities such as the manufacturing of veneer, plywood, coated plywood, eco plywood, laminated veneer lumber and pachinko plywood, sawn timber and laminated moulding products. Ta Ann is one of the pioneers in reforestation in Sarawak and actively operates its reforestation programmes on which the Group places a strong emphasis. From the commitment to ensure sustainability of its forest resources, Ta Ann has embarked on research and development programmes to produce improved tree planting materials such as Acacia Hybrid and Acacia mangium Superbulk, which return higher quality and yield for veneer production. Such initiative is in tandem with the Group s plan to gradually shift to more plantation-based resources. Ta Ann emphasises environmental friendly business practices as an important requirement to meet the needs of its customers who are increasingly becoming environmentally conscious. Due diligence surveys are carried out by independent consultants prior to commencement of ground operations to ensure that areas containing high conservation values are protected. By year 2014, the Group had more than 7,000 staff. Ta Ann has 5 timber concession areas in Sarawak of which T/3491 Tanjong Manis total area was reduced to 121,741 to excise NCR land (Ref# WPO (ll) 109). The current total area of each concession is as follows (total area: 359,180 ha): T/ Pasin Sdn. Bhd. 49,858 ha T/ Woodley Sdn. Bhd. 83,307 ha T/ Raplex Sdn. Bhd. 72,251 ha T/ Tanjong Manis Holdings Sdn. Bhd. 121,741 ha T/ Borlin Sdn. Bhd. 32,023 ha Ta Ann has 3 licenses for Planted Forests area in Sarawak of which LPF 0040 total area was reduced to 194,855 to excise NCR land (Ref# WPO/P/106 (Metetun-'Raplex) III - 27). The current total area of each concession is as follows (total area: 310,713 ha for 60 years): LPF/0002-7,703 ha (Nov 1997) Zumida Sdn. Bhd.

3 LPF/ ,125 ha (Dec 1998) Ta Ann Plywood Sdn. Bhd. LPF/ ,885 ha (Oct 2005) Ta Ann Plywood Sdn. Bhd. Raplex Division (2013): Hectares, PTD 6, Hectares (PTD = project-to-date) Melekun Divison (2013): Hectares PTD Hectares Tanjong Manis Holdings Sdn. Bhd. ( X) is a 100 % subsidiary of Ta Ann Holdings Berhad, a public company listed on the Main Board of Bursa Malaysia (then Kuala Lumpur Stock Exchange) on 23 rd November Key regulations for legal origin: The legal framework is provided in the following laws (ordinances), rules and regulations: - Statement of Forest Policy (1954) - Forests Ordinance (1954, 2003, 2006) - Forest Rules (1954) - National Parks Ordinance (1956) - National Parks and Nature Reserves Ordinance (1998) - Wildlife Protection Ordinance (1958) - Sarawak Timber Industry Development Corporation Ordinance (1973) - Sarawak Timber Industry (Registration) Regulations (2008) - Sarawak Forestry Cooperation Ordinance (1995) - State of Sarawak Forest Timber License (FTL) - Inter-agency Standard Operating Procedures (SOPs) for Performance of Forestry Functions in Sarawak (Ministry of Resource Planning and Environment, 2012) Description & Licenses: Tanjong Manis Holdings Sdn. Bhd. (a 100% subsidiary company of Ta Ann Holdings Berhad) has been issued a Forest Timber License T/3491 which is located to the South of Kapit town, in the Kapit District of the 7 th Division of the State of Sarawak. The license area is bordering the Rajang River and Baleh River in the North. The eastern boundary is defined by Sg. Sut, Sg. Bena, Sg. Entawan and Sg. Setapang. The southern boundary follows Sg. Gaat, Sg. Balang and the common boundary with License T/3135. The western boundary shares a common straight N/S line with license T/3346.The forest area is known as the Sut Gaat Management Unit, comprising a gross area of 121,741 ha. About 80,241 ha or 65.9% of the area consist of Mixed Dipterocarp Forest with the balance containing shifting agriculture areas, cropland, plantations and noncommercial forest areas. The total estimated net industrial stem wood volume has not been determined in the FMP but is regulated through a monthly production limit. Timber inventory volumes are available for currently worked harvesting coupes. Management / Land Tenure: The licensee, Tanjong Manis Holdings Sdn. Bhd. holds a Forest Timber License T/3491 issued by the Sarawak Forest Department (SFD), valid from 12 June 2007 to 11 April 2021.

4 Mangement planning (FMP): The Sut-Gaat Forest Management Plan forms part of the Forest Timber License (1 st Schedule), covering the entire FMU. The FMP has been approved by the Director of Forests of the Sarawak Forest Department on 12 th June According to the FMP the original minimum diameter for harvesting of commercial timber species had been set at 60 cm DBH for Dipterocarp, and at 45 cm DBH for Non-Dipterocarp species. These cutting limits were reduced to 30 cm DBH for both species groups by approval letter of Director of Forests dated 19 th August With effect of 15 th July 2010, DF Circular No. 4/2010 the Royalty Rate as per 1 st Schedule of the FMP has been changed to flat rates. Operational activities: The licensee has appointed Hariwood Sdn. Bhd. as its main contractor for road construction and maintenance, timber harvesting and log transportation. Hariwood Sdn. Bhd. is a registered logging contractor certified by SFD according to the provisions of the Forests Ordinance. The Certificate of Registration as logging contractor (No. R.0071/2007) is valid until 12 th July 2015, by approval of Director of Forests. Area classification Area (ha) Total concession area as per FMP, consisting of 121,741* a. Natural Forest Management Area / Operable area (estimated net production area) 80,241 b. Protected Forest / Terrain IV & Conservation Areas 9,748 c. Non-forest areas: social, community & shifting cultivation areas (SHC 31,320 ha; Alienated land 3,683; Agriculture area 168 ha) 31,772 d. Area difference FMP / company GIS 488 Notes: - area figures a. c.: as per General Harvesting Plan (derived from Geographic Information System) and updated by appointed consultant RMG Survey SB on 20 th April area figure d.: Gross area calculated as per GIS is 125,160 ha, exceeding the gross area stated in the FMP by 0.39% * Resized to 121,741 ha (FDS #: WPO (II)-109 dated 21 st May 2013), exclusion of NCR land Description of forest area: Harvesting operations in this area started in The forest area mainly consists of Mixed Dipterocarp Forest classes MDF II, III and IV, and shifting cultivation areas, as mapped and quantified in the Forest Type Map B of the FMP. The original cutting cycle was 22 years ( ). Part of the area was subsequently worked under Forest Timber License T/3400A (Coupes 1A to 5A), before the current License T/3491 was issued to Tanjong Manis Holdings Sdn. Bhd. in year Current annual coupe areas of T/3491 range from 2,862 ha to ha, consisting of a total of 20 Coupes. Each coupe is subdivided into blocks, typically ranging from 50 to 100 ha. No overall resource data exist for the license area. Forest Inventory data (10% intensity) are only available for currently worked Coupes/Blocks. Estimated average commercial volumes range from m3/ha.

5 Environmental Impact Assessment: No EIA was conducted for Licence T/3491. However, Ecosol Consultancy Sdn. Bhd. conducted an EIA (May 2006) for the License for Planted Forests LPF 0040, issued to Ta Ann Plywood Sdn. Bhd. This area overlaps with the area of the natural forest timber license T/3491. The EIA carried out under LPF 0040 is following behind the harvesting operations carried out under the natural forest license T/3491 and consequently, it cannot address the environmental impacts and precautionary measures to be undertaken in license T/3491. Key EIA Findings: Not available for T/3491. EIA is based on LPF 0040 license area that overlaps Licenses T/0560 & T/3491. Environmental Protection & Monitoring: Monitoring records are not available for T/3491. Focuses on the protection of large rivers using 20-50m buffer zones (as prescribed in the Detailed Harvesting Plan) protection of smaller streams and monitoring measures have not been implemented. Social Assessment: Tanjong Manis Holdings Sdn. Bhd has not conducted a social impact assessment for T/3491. Since the area is in the process of progressively being developed into a forest plantation a SIA was conducted by Ta Ann Plywood Sdn. Bhd. in February 2013 under the subsequent License for Planted Forests - LPF This license area is identical with the area of Forest Timber Licence T/3491. Tanjong Manis (Hariwood) has established agreements with all long houses that claim forest land within the license area T/3491. Key Findings of Social Assessment: Not reported for T/3491. SIA is based on LPF 0040 license area that overlaps Licenses T/0560 & T/3491. Social Monitoring: Not reported for T/3491. Itinerary of Assessment 20 July 2014 Travel from KUL-Sibu (overnight in Sibu) Sunday 21 July 2014 Monday 22 July 2014 Tuesday Opening meeting at Ta Ann office, document review, travel to Kapit town (overnight at Kapit) Kapit to Raplex, Contractors camp A (Raplex / Sg. Pila), Logging Operation at compartment 10AR (1), Block Boundary at Block 28/31, Block 28A/B, Streams, Riparian Reserve for Sg. Lemai, existing HCVF marking (overnight at Raplex camp) Raplex Nursery Camp, LPF Block 13A (Coupe 7A), Block 46 (Coupe 8A), Raplex Log Pond (overnight at Kapit) 23 July 2014 Wednesday 24 July 2014 Hariwood Office, Site Visit to LPF 0040 and T/3491 Coupe 13 (Harvesting)- Block 5,

6 Thursday Riparian Reserved (Block 32/37 Coupe 5B), Buffer zone marking (Block 25/26), Hariwood base camp, RH Madang (overnight at Kapit) 25 July 2014 Friday Hariwood logpond, travel back to Sibu, document review (overnight in Sibu) 26 July 2014 Saturday Document review, closing meeting, travel back to Kuala Lumpur Highlights of Assessment Tanjong Manis Holdings Sdn Bhd has demonstrated compliance to the GFS LVS-005a v06 for Sarawak, Malaysia as no major gaps were identified in the assessment. Tanjong Manis has addressed minor GAP 002/2013, however 2 minor gaps raised in 2013 are still outstanding and GAP 005/2014 minor was issued on identification and buffering of streams in relation to NREB guidelines. Tanjong Manis holds a valid harvesting license for Forest Timber License T/3491 from Sarawak Forestry Department, covering a total gross area of about 121,741 ha. The License expires on 11 April Hariwood Sdn. Bhd. has established agreements for all longhouses that have claims on the forest license area. Harvesting systems are based on conventional logging of the block area in accordance to diameter limits for commercial species without reduced impact logging or sustainability requirements. Harvesting operations are in compliance to the legal requirements but lack clear identification of buffer zones for smaller streams based on NREB guidelines GAP 005/2014 (Minor). Logs extracted from the harvesting area are identified and tagged at the forest log landing sites and can be traced back to individual coupes and blocks. A legal verification system of log identification, registration, assessment for royalty collection and transportation has been developed by the responsible government agencies. The Log Tracking System (LoTS) ensures a chain-of-custody from the forest to the inland destination (for local processing) and to the log export point. There is consistency in log registration and tracking from the forest block to the logpond. GAPs : 2014 GAP # Type Checklist # Description 005/2014 Minor Stream buffer zones are not marked in the current coupe area based on NREB guidelines (refer EIA LPF 0040; pages C5-8).

7 Previous Gaps : 2013 GAP # Type Checklist Status Description 002/2013 Minor Closed 003/2013 Minor Outstanding 004/2013 Minor Outstanding No evidence of Tanjong Manis is harvesting within defined buffer zones that are also identified as HCV areas. Storage, handling and protection of fuel, oil and lubricants are inadequate. Ta Ann is in process of developing Environmental Management Plan (EMP) for selective timber harvesting for overlapping licenses LPF/0040, T/0560 and T/3491. The EMP still needs to be completed and approved. The EMP is planned to be complete by Highlights of Close Out Visit (if applicable) Not Applicable. Recommendations Tanjong Manis Holdings Sdn. Bhd. has demonstrated compliance to the GFS Forest Legality Standard for Sarawak Malaysia (Doc # LVS-005a v06 Feb 2014). GFS Malaysia shall re-issue a Statement of Compliance to Tanjong Manis Holdings Sdn. Bhd. - Forest Timber License T/3491. The three Minor Gaps shall be addressed by the next assessment in August End of Summary Report