Home TIS Intelligence North Kalimantan Govt: We Need Sustainable Economy

North Kalimantan Govt: We Need Sustainable Economy

Hydro Power in Indonesia - Photo: Privacy

JAKARTA (TheInsiderStories) – As a new and the youngest province in Indonesia, North Kalimantan needs big investment, especially infrastructure to accelerate the development.

However, the North Kalimantan try to make a difference with the surrounding provinces in Kalimantan which is very depend on commodities such as coal. The North Kalimantan provincial administration wants to develop sustainable economy, including renewable energy. Therefore, they encourage the green investments in North Kalimantan.

The Insider Stories has opportunity to interview with North Kalimantan Governor, Irianto Lambrie that give insights about the potential economy and the need of investment in North Kalimantan.

Below are the full-transcript:

Q : How the prospect of development in North Kalimantan?
A : We have rivers, we have a vast land. River is the source of water. Therefore, we formulate a policy that is not only maintain or protect it but also how to utilize the forest and natural resources, to be a source for society life but at the same time we keep conservation efforts.

It has been done traditionally by our society and supported by the policy of local government. Therefore in North Kalimantan, we develop infrastructure development programs that directly related with conservation efforts. For example, we develop hydro power, then we reduce the limitation of mining exploitation permit like as coal, gold, and others. We also fully support efforts to reduce the use of forested areas for non-forestry activities.

But, we must also support efforts to agrarian reform because our forests are still huge and our society are still relatively poor, thus we utilizing non-productive forest areas for sustainable investment activities.

Q: What will you do in practices?
A: First, we keep the conservation area. We have a 1.3 million Ha conservation area that we do not touch until now. If anyone damage it, we will give punishment or fines. Our people, especially indigenous peoples, in Malinao, Nunukan, and Dayak, also make efforts to keep the forest safe.

The second, we protected forest area. We are planting to increase the number of trees in order to reduce these emissions. Then we also reduce the use of fossil-fuels. As a new province, we encourage the innovations to reducing the use of fossil-fuels, including coal use. Therefore, we develop renewable energy because in fact currently, there is no power plant based coal in North Kalimantan.

Q : So, you will push renewable energy?
A : Yes like as hydro power. Now this is what we focus on, and it will generate large electricity power, ten thousand of megawatt (MW). In addition, we also push natural gas use as alternative energy. Then, solar and biomass. We have oil palm plantation that can be used for energy.

Q : How are the investors-appetite?
A : There are interest from the domestic investor but they are still waiting for the administrative issues related to the cooperation with PT Perusahaan Listrik Negara (PLN). In Malinau for example, there are plans to built 2×30 MW to use biomass from plants, forests or oil palm in waste. But now it is still are processing.

Irianto Lambrie

I always encourage the investment to be realized but investment can only be realized if it has a profit prospect. They need buyer to buy the electricity that they are produced. For example with PLN. The process of cooperation with PLN sometimes takes time. But, from our side, we are fully support them.

Q: How you deal with deforestation?
A : I think the local government has limit power in terms of forest utilization. The power lies on in the central government. For example, natural forest management permit. They will usually submit an annual work plan such as how much they will cut the trees down. It is central government authority. We can only make recommendations.

Q : You held Kaltara Investment Forum in March 2017. What the results?
A : A lot of investors have expressed interest. Some of them also have conducted feasibility studies. For example, we have Memorandum of Understanding (MoU) with Hyundai (Korea) for hydro power and industrial area.

There are also a lot of interest from China investors. The last one is Tsingshan Group, HBSTI (Hubei Science & Technology Investment Group), China Power Investment, Serawak Energy Berhad from Malaysia. There is also interest from Canada company, Athabasca who will build oil refinery.

Q : Do you have investment target?
A : As much as possible. We are open. For example is if hydro power plant has been realized in five years or 900 MW, it is required investment of US$ 2.7 billion or Rp30-40 trillion. The Tsingshan Group plans to build in industrial area with an investment plan of Rp30-40 trillion for steel processing industry and smelters as well.

We also already have the MoU with state-owned aluminium processing PT Inalum (Indonesia Asahan Aluminium). With potential of big electricity power supply, they will shift their industry to North Kalimantan. It has been approved by the Minister of Industry that directly directed by President.

Q: How about progress Belt Road projects in North Kalimantan?
A : Yes, we already offer projects in hydro power, industrial area, and international port. We have already done feasibility study that we provide an industrial area of ​​25,000 Ha as a whole. The first phase we offer 7,500-15,000 Ha and it was becoming the largest industrial area in Indonesia with various industries that located in Tanah Kuning. (RF)

(Written by Linda Silaen, Email: linda.silaen@theinsiderstories.com)