- The Bantaeng Industrial Estate is a 3,000-hectare ore processing zone in Indonesia’s South Sulawesi province.
- President Joko Widodo has banned exports of raw mineral ores to compel companies to construct smelters to produce value-added nickel.
- But South Sulawesi communities living alongside the smelters report health impacts from pollution generated on site. Relocation plans have yet to be enacted.
BANTAENG, Indonesia — Stepping into Mustajab Syahrir’s home in the village of Papan Loe feels like treading on a beach of fine sand.
“What am I supposed to do?” Mustajab said. “As long there is wind, the dust is going to get inside.”
Mustajab’s home in Papan Loe village is adjacent to a nickel processing center operated by PT Huadi Nickel-Alloy Indonesia, a local subsidiary of China’s Huadi International Group. In 2018, the Nasdaq-listed metals manufacturer was the first company to produce nickel in the Bantaeng Industrial Park, here in South Sulawesi province.
The Bantaeng Industrial Park is a national priority infrastructure project and aims to be one of the world’s largest processing sites for nickel. It was established by regional government decree in 2012.
Indonesia has the world’s joint-largest reserves of nickel, a raw material for the batteries used in electric vehicles, which are expected to reduce both emissions and pollution from transportation over the coming decade.
In 2020 the value of Indonesia’s unprocessed nickel ore exports was around $200 million.
But in 2021 President Joko Widodo installed a new ban on exports of unprocessed ores in a bid to catalyze a domestic nickel processing industry.
Indonesia’s chief investment minister, Luhut Panjaitan, said in September that investment in the Morowali Industrial Park, in Central Sulawesi province, was set to almost triple between 2019 and 2022 to around $18 billion.
The Bantaeng site extends more than 3,000 hectares (7,400 acres) and overlaps with six villages, including Papan Loe.
Two hamlets in Papan Loe are caked in dust from morning to night. It lines the walls of homes. Dust coats the skin after just a quarter of an hour speaking with Mustajab. It blackens the nose.
The dust sticks to the community’s plants. People have to scrub clean moringa before consuming the fruit, which is high in protein and other key nutrients.
“It’s brown,” one resident told Mongabay. “If you don’t clean it, it’s toxic to eat.”
Adam Kurniawan, former director of the South Sulawesi-based Balang Institute, an NGO, has monitored living conditions among residents near the industrial park since 2013.
At a meeting with the provincial parliament, Adam told lawmakers on Aug. 29 that local communities likely face significant undocumented health risks.
“There are residents who have been coughing for months,” he said.
Mustajab signed away his family land to the company in 2014. The price per square meter was 50,000 rupiah ($3), which he shared with his brother.
At first the siblings did not want to sell. But Mustajab received a visit from the police and the military, who took him to the residence of Nurdin Abdullah, the elected head of Bantaeng district.
The district chief laid on food and good humor.
“At the meeting everything was good,” Mustajab said, recounting the tone of what he was told. “If the company operates it can bring prosperity, our children will be recruited to the company, we will be given free electricity.”
But Mustajab remains skeptical of the benefits brought by the strategic development project and feels that giving up his family land was a fait accompli.
“The company built a fence and my land was right in the middle,” he said. “I couldn’t enter, so I sold it.
“I was not forced to sell my land — but I was forced to sell it,” he said.
Anecdotal reports from residents of Mustajab’s hamlet suggest complaints of impaired lung function may indicate a hidden health crisis.
During the day the volume of dust is not as apparent, but at night the headlights of company trucks moving back and forth from site locations illuminate a dense fog of particulate matter.
A survey by the NGO indicated 37 ground wells had dried up since PT Huadi Nickel-Alloy Indonesia began operating in 2018.
“Almost all the wells near the [industrial park] have run dry,” Mustajab said.
The Balang Institute has questioned the validity of how the company acquired land from local residents, as the land appeared to have been directly acquired from individuals instead of via the local government.
On July 4 the Ministry of Environment and Forestry enacted a list of administrative sanctions against PT Huadi Nickel-Alloy Indonesia covering several environmental violations.
The ministry also stated that construction of the fourth stage of the company’s two-burner plan was not covered by the environmental impact assessment published in 2020.
In response, Huadi spokesperson Lily Candinegara said the company continued to listen to the concerns of local residents.
“It is not that we want to turn a blind eye, not at all,” Lily said.
Addressing the issue of groundwater depletion, Lily said the company coordinated with the regional office of the Ministry of Energy and Mineral Resources, which had conducted field checks on Huadi’s operations.
At the meeting with regional parliament lawmakers, they discussed plans to relocate communities affected by the nickel operations.
“How much money does the government come up with? Who will oversee the relocation? Or will they wait for everyone to get sick first?” said Junaedi Hambali, from the Balang Institute.
At the time of writing, three companies were licensed to operate in the Bantaeng industrial Park: PT Dowstone Energy Material Indonesia, PT Hengsheng New Energy Material Indonesia and PT Unity Nickel-Alloy Indonesia.
When PT Huadi Nickel-Alloy Indonesia began operating in 2018, the company sought to assuage local concerns by emphasising its use of environmentally sound technology to dispose of waste.
But after only a year, residents began to complain as communities turned into dust bowls.
“This is only one company operating — and we have suffered like this,” Mustajab said. “What will happen when all of them are operational?”
Banner: Piles of coal in the Bantaeng Industrial Park. Image by Eko Rusdianto for Mongabay.