Kota Kinabalu: The first phase of the controversial carbon deal between the Sabah Government and Hoch Standard has begun with a 600,000-hectare area of forest reserves, said Deputy Chief Minister Datuk Seri Jeffrey Kitingan.
Called the Nature Conservation Agreement (NCA), he said the first phase involved designating the areas to be allocated before groundwork can proceed.
“We now have about 200,000 hectares so we are waiting for the other portion. I have had discussions with the Forestry Department and the Chief Minister, and he said the 600,000 hectares will be made available,” he said.
“No such thing as a pilot project. It is the initial launch,” he said during an online talk on the “Sabah Way Forward” Facebook platform hosted by Kupi Kupi FM.
SPONSORED CONTENT Daily Express members: Enjoy 1 for 1 signature cocktails and more at Hyatt Centric Kota Kinabalu Kota Kinabalu: DAILY EXPRESS is partnering with Hyatt Centric Kota Kinabalu to offer an exclusive deal for our members. Read more Jeffrey, who is State Agriculture, Fisheries and Food Industry Minister, said the area will involve different classes of forest reserve, for example, the Trus Madi, the second tallest mountain in the country.
He said the NCA involves a total of two million hectares, but this will depend on the success of the first phase. “We will do the rest once the government is satisfied,” he said.
He said the project would take up to 18 months to get off the ground and see results as they will need to arrange for satellite, planes, drones, forest rangers and human capital on the ground.
“There will be a data room to indicate what we have. Then people need to verify that data and from there we can create certification then can start the process of grading so on.
“And before that a lot of preparation goes into it and the company will have to come up with all the expenses in order to mobilise and get it started before results can be seen.
There are project developers in other areas, off takers, auditors, and so on. A lot of processes. So, at the end of the day, it will be a year before results can be seen,” he said.
Jeffrey said there was urgency to get the project off the ground claiming the state was losing out on lucrative profits up to RM8 million per day, every day the project was not on.
He claimed that there were parties determined to derail the project, with the latest move being a court application for a judicial review to question the processes of the NCA.
Jeffrey, who is also Chairman of the Steering and Management Committee for the Implementation of the NCA, claimed that all due diligence has been carried out, and that the project would conform to the latest international standards of carbon credit management and sales.
“Maybe one year from now we can see results, then the people who were against it, those taking much effort to delay the start the project, one day they will blame themselves because they were carried away by certain people because of misunderstanding and greed.
“One year can prove to critics that this is the right thing to do for Sabah,” he said.
He questioned the motives of the move.
“They should be careful that their motive is genuine, otherwise it will backfire on them,” he said.
Hence, he said the October 28, 2021 NCA deal with Singapore-based Hoch Standard Ltd (owned by Dr Ho Choon Hou) was still under implementation to meet various international requirements.
Hoch Standard has since been taken over by the British Virgin Island-based company Lionsgate. The deal involves management of carbon credit sales of two million hectares of forest reserves for a period of 100 years.
Jeffrey said there is nothing sinister about the offshore company as insinuated by some groups as the owner of Lionsgate is Dr Ho Choon Hou.
“I have nothing to do with it,” he said.
He defended the firm, saying they have onboard the advisory board former chief judge Tun Mohamed Rauf Sharif among other specialists to provide legal and technical expertise.
He, instead, pointed out another carbon deal which should be scrutinised, between Permian Malaysia Sdn Bhd, the Sabah government and Yayasan Sabah subsidiary and Rakyat Berjaya, signed on August 6, last year, involving an 80,000ha-logged-over forest in Kuamut.
“Who are the Luxemberg buyers?
“I have studied three agreements. I am sorry to tell you it is nothing compared to the NCA deal which costs us nothing.
The Permian deal is 84,000 hectares and takes five per cent from gross sales or RM40,000 a year goes to the government. But the government has to pay RM250,000 per year for five years.
“And there is no requirement for free, prior and informed consent,” he said, adding that the company is given a free hand to dictate the pricing of carbon sales and provide for discounts under the proposed deal.
In comparison, under the NCA Sabah, the assigned party — Hoch Standard will deal with the major global management groups involved in carbon trading.
He said that the state government has already engaged with and gotten the blessings via signatures of 16 native groups and would continue to engage with more indigenous groups which fulfils its obligation for free, prior, and informed consent to the people involved.
“To me, it’s more than enough, but we will keep going, so they’re also in the monitoring group,” he said.
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