Sabah Forestry Dept denies delays in carbon trade deal, says land given for pilot project


KOTA KINABALU: A 190,051ha area of totally protected forest has been allocated to Singapore-based Hoch Standard to carry out its pilot programme to harness carbon credit, says Conservator of Sabah Forests Datuk Frederick Kugan.

He dismissed claims that the Forestry Department is delaying the implementation of the Nature Conservation Agreement (NCA) with Hoch Standard, saying that the pilot plot at Nuluhon Trusmadi Forest Reserve (Class I reserve) has been allocated to the company.

Kugan said that the allocation was made after Deputy Chief Minister I Datuk Seri Dr Jeffrey Kitingan made a formal request in June 2023.

"The department had viewed the request at that time as reasonable as the pilot site could test the framework for parts of the NCA and the potential gains due to the state (through carbon credit sales)," he said in a statement.

Kugan was responding to Kitingan's political secretary Anuar Abdul Ghani's claims at the recently concluded Borneo Rainforests Law Conference that the delays in the implementation of the NCA were "self-induced" by the department

"The comments ( by Anuar) are misleading," Kugan said, adding that Anuar's suggestion that Hoch Standard could possibly sue the state government for its untrustworthiness was totally uncalled for.

"On behalf of the Sabah government, the Forestry Department is of the view that Anuar's comments that Hoch Standard should sue the state government and insinuating untrustworthiness on the part of the state government are uncalled for," Kugan said.

He said that it was now up to the company to meet other requirements including obtaining additional unencumbered forest areas to develop the natural capital for the carbon project.

The issue of Sabah's NCA deal became a spotlight on the sidelines of discussions at the recent Rainforest Law conference organised by the Commonwealth Lawyers Association and Sabah Law Society.

Anuar had presented a talk on the NCA, saying that he was reflecting the views of Kitingan; among other things, he had said that the NCA controversy blocked Sabah from cashing in on the carbon credit trade.

At another session at the conference, state government legal advisor Tengku Datuk Ahmad Fuad said that the Oct 2021 NCA deal to carry out carbon trading on two million hectares could not be implemented as it was legally flawed.

He said that the agreement did not conform with the Sabah Biodiversity Enactment 2000 on designated areas, and added that it also lacked transparency on carbon credit sales.

Ahmad said that the agreement fails to take into account the legal requirements that were needed to be obtained from the Biodiversity Council and Biodiversity Centre which oversees all conservation and sustainable use of natural capital.

He added that totally protected forests cannot be used for carbon credit trade generating projects as it was not in line with Article 6 of the Paris Agreement which specified carbon credits can only be generated if the area concerned is under threat of deforestation.

Ahmad then said that there were various issues on the NCA deal that were vague and needed to be clarified.

Meanwhile, Sitiwin & Jintoni, advocates for former chief justice Tun Richard Malajun denied Anuar's claim that Malajun had ever given the opinion that the NCA was legal, valid and enforceable.

"We are instructed to put on record that Tun Richard Malanjun has never expressed any professional opinion (or otherwise) on the legality or status of the Nature Carbon Agreement," his lawyers said.

They said that Malajun had never sighted the "fair copy" of the agreement and as such Anuar's statement was "erroneous and untrue."

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