Environmental licensing – who needs it?

Liga ba Lisensamentu Ambientál – hodi proteje ita hotu, verzaun Tetum artigu ne'e atualiza iha Novembru 2018

Protecting Timor-Leste's fragile environment is essential for national development and improving the quality of people’s lives. It allows us to farm, eat, drink, fish and breathe. If we allow it to be damaged, we get famine, flooding, pollution, toxic waste and disease. This is recognized in Article 61 of Timor-Leste’s Constitution: “Everyone has the right to a humane, healthy, and ecologically balanced environment and the duty to protect it and improve it for the benefit of the future generations. … The State should promote actions aimed at protecting the environment and safeguarding the sustainable development of the economy.”

As the 2011-2030 Strategic Development Plan explains, “The people of Timor-Leste have a strong relationship with the natural environment. For generations, our ancestors depended on the environment for food, clothing, building materials and everything else essential for life. We lived in harmony with the environment, using it sustainably to support our families.”

To achieve these goals, and to protect Timor-Leste’s unique geology and ecosystems, projects with significant environmental risk need to be evaluated and licensed before they are built, including both assessing possible environmental impacts and planning how to manage them, during both construction and operational phases. Since 2011, Timor-Leste has had our own environmental licensing law, and before that the Indonesian AMDAL law applied here. Nevertheless, very little is known about the licensing processes for environmentally risky projects which were started or built in the last three years.  Many never even bothered to apply.

RDTL Decree-Law no. 5/2011 of 9 February on Environmental Licensing  (Portuguese original) requires projects which could have significant environmental effects to prepare Environmental Impact Assessments and Environment Management Plans (Art.4). The National Environment Directorate (DNMA, part of the Ministry of Commerce, Industry and Environment) creates a committee (Art.10) to evaluate the EIA and EMP, conduct public consultation (Art.11), and require improvements (Art. 12.3, 14.3) before recommending (Art.13) that a license be issued (Art.14). No one can begin implementing a project without a license (Art.23.5), subject to up to a quarter-million-dollar fine (Art.34.5). Licenses (as well as reasons for denial or special requirements) are to be published in the Jornál da Repúblika (Art.14.4, 21.4) and DNMA must maintain a public register of licenses, evaluations and other information (Art. 38).

Although the Decree-Law is not perfect, it could help protect Timor-Leste’s delicate ecosystems … if it were actually implemented. A few years ago, La’o Hamutuk participated in consultations on exploratory offshore drilling, and we also learned that the Suai Supply Base received a license last year (with no public consultation), but the Jornál da Repúblika has never mentioned an Environmental License.

Last January, La'o Hamutuk joined discussions with an ADB technical assistance project to improve environmental licensing processes, and it became clear that this law is violated far more often than it is obeyed.

We asked how many licenses had been granted, and a few weeks later ADB included a list from DNMA in a workshop presentation, showing that DNMA had issued eleven licenses, and five more were in process. Only two of the eleven were for large projects with major environmental impact (Category A under the Decree-Law): the now-abandoned Pelican Paradise resort project in Tasi Tolu, and the Suai Supply Base (SSB).

DNMA’s list said that the SSB License was “issued with political interference,” a precedent they didn’t want to repeat. As La’o Hamutuk has explained, the SSB license was issued last year without any public consultation or the required project-specific Environmental Management Plan. When we suggested that DNMA should implement clause 2.4 of this License -- “Due to serious violation of the EIA, EMP and Environmental License procedures, the RDTL environmental authority will suspend or cancel environmental license as described in Article 35(c) of Decree-Law No. 5/2011” -- everyone at the workshop smiled.

La’o Hamutuk then made a formal request (Tetum original) for information on licensing to date, and DNMA staff was cooperative. Although the public register doesn’t yet exist, in March they provided the table of licenses at right, as well as some of the licenses and other information.

Later, they told us that they were reviewing another Category A project, Esperanca Timor Oan (ETO)’s planned fuel depot in Hera, and provided the terms of reference for its upcoming licensing application.

However, we were sad to learn that many significant projects never contacted DNMA to initiate the licensing process. Multi-story buildings on two or more hectares of land are Category A, but DNMA has heard nothing from the builders of Timor Plaza (Tony Jape, Comoro), the Ministry of Finance building (Kampung Alor) or the Palm Business and Trade Center (Jackson Lay, Surik Mas), even though construction is far along for all three of these.

Even if a project uses less than two hectares, it still requires a license as Category B. The Prime Minister himself laid the cornerstone for AGP Square (Tommy Winata, Arthagraha Group Peduli, Kaikoli) last November, but DNMA has heard nothing about this project. Other large projects – the Hera and Betano power plants, Comoro bridges, tourism beach developments -- have also defied  licensing requirements. We listed a few of them in the following table, and we encourage people who know of other projects which require licenses (the criteria are annexed to the Decree-Law) to tell DNMA about them.

Project	Location	Owner	Status	Land Area	Cat.	License status
Timor Plaza 5-story building and several others	Comoro, Dili	Tony Jape	Some buildings finished, other construction continues	4 Ha	A	Never applied. Ground-breaking in 2009, opened 2011.
AGP Square 26-story building	Kaikoli, Dili	Tommy Winata, Arthagraha Group Peduli	Cornerstone laid, no work since	1.5Ha	B	Not yet applied. Ground-breaking Nov. 2013
Palm Business and Trade Centre	Surik mas, Dili	Jackson Lay	Mostly built	2 Ha	A	Never applied. Construction began in 2011, opened 2013.
Ministry of Finance 11-story Building	Kampung Alor, Dili	RDTL MoF	Mostly built	2 Ha	A	Never applied. Construction began in 2011, not yet finished.
Hera power station	Hera	EDTL, MOP	Built	3.5 Ha	A	Never applied. Construction began in 2009, operation in 2011.
Betano power station		EDTL, MOP	Built	82 Ha	A	Never applied. Construction began in 2010, operation in 2012.
Pacific Beach Resort	Dolok-oan	Tony Jape	Land clearing  started recently	22 Ha	A	Not yet applied
Dollar Beach	Metinaro	Tony Jape				Not yet applied
Trafigura fuel depot	Hera	Sacom Energia			A	Not yet applied
ETO fuel depot	Hera	Esperanca Timor Oan			A	TOR approved, application in process
Offshore oil drilling	Bayu-Undan, Kitan	Conoco-Phillips, Eni			A	Never applied to DNMA, new wells in 2013-4
MSS Building	Kaikoli, Dili	RDTL MSS	Built	0.7 Ha	B	Never applied, already built
Comoro Bridges I+II	Comoro, Dili	MTC/MPS	70% built	250m	B	Never applied, mostly built

After La’o Hamutuk’s inquiries, DNMA became more pro-active in publicizing licensing requirements, and started distributing a notification letter (right) to state agencies and private sector developers. We hope that this will be followed up with enforcement.

Among the long list of projects whose proponents have not engaged with DNMA, two are especially dangerous and worrisome. Trafigura, a European commodities trading company, plans to build a fuel storage depot in Hera, with the capacity to hold 90 million litres of oil, nine times the amount needed for Category A.
Together with their local partner Sacom Energia (headed by Abilio Araujo), Trafigura received a $73 million contract last March to supply fuel for the Hera and Betano power plants and delivered the first 12 million liters on 2 April. Trafigura comes with a long record of corruption and environmental devastation, including a recent $750 million case in Angola and one which poisoned 100,000 people in Côte D’Ivoire in 2006, and we hope that DNMA and other regulators will prevent them from inflicting similar damage in Timor-Leste.

Tony Jape, the developer of Timor Plaza, has never applied for a single environmental license. He recently began clearing more than 20 hectares of beachfront land in Dolok-oan, between Cristo Rei and Hera, for a tourist resort. Some have asked how Jape got permission to develop this public land and a similar tract at “Dollar Beach” in Metinaro (his projects in Darwin are also problematic), but this article focuses on environmental regulation. The precedents set here could protect (or endanger) many parts of Timor-Leste’s beautiful and fragile shoreline.

Timor-Leste has not had effective environmental protection during twelve years of independence, or for centuries before that. Although we appreciate the work of the State Secretariat for Environment in discouraging littering and planting trees, the most imminent dangers to our ecosystems are from large construction and industrial projects, which involve huge quantities of toxic chemicals that endanger health and could contaminate river ecosystems, ground water, agricultural land, oceans and the atmosphere.

We hope that Timor-Leste’s Government will become more effective in keeping our land and waters safe, clean and habitable, strengthening some communities’ use of Tara Bandu to protect their local areas. Government and project owners must make information available, consult with the people, and obey and enforce our laws, so that everyone can work together to protect Rai Furak ida ne’e.

Update, June 2016: During the two years after this blog was written, environmental licensing continue to be applied sporadically and ineffectively. On 31 May 2016, La'o Hamutuk wrote an open letter to the Provedor (Ombudsman) for Human Rights and Justice, urging his office to look into this breakdown in the of rule of law and make recommendations about how it can be addressed.