Deal #1166

Location

Location #1

Spatial accuracy level
Exact location
Location
Manga, Republic of the Congo

Latitude
-0.34125562486381283
Longitude
16.058998006884735
Target country
Congo, Rep.
Comment on location
The majority of the land (402,637 hectares) is in Cuvette Province

Location #2

Spatial accuracy level
Exact location
Location
Makoua, Republic of the Congo

Latitude
0.6876311642004528
Longitude
15.282340256249995
Target country
Congo, Rep.
Comment on location
The remaining 67,363 hectares are in Mokeko District in Sangha Province.
General info

Land area

Intended size (in ha)
470000
Size under contract (leased or purchased area, in ha)
[2010] 470000
Size in operation (production, in ha)
[2013] 400
[2014] 570
[2017] 750
Comment on land area
Atama says it will develop palm oil plantations on 180,000ha. 15000 cubic meters of timber has been felled for 120 hectares- thus to clear 180 000 would result in a sale of timber valued at more than $500 million.

Intention of investment

Intention of investment
Biofuels, Agriculture unspecified, Timber plantation (for wood and fibre), Renewable Energy
Comment on intention of investment
180000 of palm groves, & 290000 for ancillary industries, for industrial production of palm oil estimated at 90000 tonnes per year. Palm oil will be processed, with waste being used to generate electricity. The company has admitted that “timber extraction is a necessary part of the process to make available land for an oil palm plantation”- The potential profits from harvesting this timber may be one of the main driving factors behind the development. A report by found that the company had many irregularities regarding the timber removed (i.e. not recorded, clearing for roads). The planting program for palm oil is envisaged to be carried out in 10 phases over a 15-year period and the first phase commenced in 2013. The government suspended the fraudulent logging activities in February 2017- but the suspension only relates to one block within the plantation. There are concerns that large portions of the land is in fact un-suitable for palm oil cultivation.

Nature of the deal

Nature of the deal
Lease

Negotiation status

Negotiation status
[2008] Intended (Under negotiation)
[2010] Concluded (Contract signed)
Comment on negotiation status
On 17 December 2010, after 19 months of negotiations, the Minister of Agriculture and the Minister of Land Affairs and Public Domain in the Republic of Congo signed a concession agreement with a company called Atama Plantations to ‘occupy’ 470,000 hectares of federal land for the development of an oil palm plantation and associated industrial complexes. Company website states 60 year lease, other sources state 30 year lease.

Implementation status

Implementation status
[2013] In operation (production)
Startup phase (no production)
Comment on implementation status
To date, Atama has begun clear felling forests for roads and an oil palm nursery in one area of 5,000 hectares at Epoma in Sangha, while a second 5,000 hectare section of forest in the concession in Cuvette has also been signed off for logging and clearance. These areas overlap with a national park and a Ramsar site. The company has not finished clearing these sites (2017). 400ha planted between March and June 2013. Planting rate targeted is 5000ha per annum. The planting will occur in ten phases, over a 15 year period. The goal was to have 2000ha planted by the 1st quarter in 2015. Unlikely that the company will reach their goal of 180 000ha planted- timber extraction occurring more rapidly than planting of seedlings. The government suspended the fraudulent logging activities in February 2017. Planting of oil palm has not taken place in 2017- focus on logging. Also the company stated that they are considering abandoning the plantation. Grain states the plantation is failed. It seems that the palm oil plantation is abandoned, but the logging continues.

Leasing fees

Annual leasing fee
2500
Annual leasing fee currency
Congolese Franc
Annual leasing fee type
per ha
Comment on leasing fees
The licensee has to pay royalties of CFA 2,500 (US$5) per hectare of planted land (half the rate which will eventually be paid by Olam in Gabon, from when palm oil production starts, but is exempted from customs duties or VAT on imports of equipment, and from all taxes on profits for the first five years of production. The company registered a pre-tax loss of USD5.0 million in 2014.

Contract farming

Contract farming
No
Contracts

Contract #1

Contract date
2010-12-17
Duration of the agreement (in years)
30
Comment on contract
Company states a total of 60 year lease-- 30 years, with additional 30 years renewable. The contract signed in December 2010 granted rights over 30 year period, this was reduced to 25 years renewable lease by a presidential decree in August 2011.
Employment

Number of domestic jobs created

Jobs created (domestic)
Yes
Planned number of jobs (domestic)
20000
Current number of employees (domestic)
[2017] 15
Comment on jobs created (domestic)
Atama promises meaningful long-term employment for locals
Investor info

Operating company

Operating company
Atama Plantation SARL (#35660)
Comment on investment chain
Wah Seong has majority shareholding in the project (51%), other shareholding interests unknown. Wah Seong reduced its interest from 51% o 49% in 2015 (it is not clear who took the 2% shares) and was looking to exit completely. Agro Panorama took over the shares of Wah Seong in 2017. It appears Agro Panorama is a shell company.

 

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Data sources

Data source #1

Data source type
Media report
URL
http://farmlandgrab.org/post/view/18424;
File
Date
2011-01-06
Comment on data source
Farmland Grab- DRC: Oil Palm invasion era

Data source #2

Data source type
Research Paper / Policy Report
File
Comment on data source
Rainforest Foundation- Seeds of destruction, February 2013, case studies of new oil palm developments in the Congo basin

Data source #3

Data source type
Media report
URL
http://www.africanconservation.org/news/item/atama-plantations-sarl-will-create-largest-oil-palm-plantation-in-congo-basin
File
Date
2013-03-17
Comment on data source
African Conservation Foundation- Atama Plantations SARL will create largest oil palm plantation in Congo Basin

Data source #4

Data source type
Company sources
URL
http://atamaplantation.com/site/index.php?cat=7
File
Comment on data source
Company website

Data source #5

Data source type
Media report
URL
http://www.jeuneafrique.com/mag/255185/economie/congo-brazzaville-la-renaissance-des-pepinieres/
File
Date
2015-08-20
Comment on data source
Jeune Afrique -- Congo-Brazzaville : la renaissance des pépinières

Data source #6

Data source type
Research Paper / Policy Report
File
Comment on data source
Forest Trends Report Series- Forest Trends Report Series Forest Trade and Finance September 2014 Consumer Goods and Deforestation: An Analysis of the Extent and Nature of Illegality in Forest Conversion for Agriculture and Timber Plantations, September 2014. pg 97 and 99

Data source #7

Data source type
Media report
URL
http://www.bloomberg.com/news/2012-02-02/atama-of-malaysia-plans-congo-palm-oil-plantation-ministry-says.html
File
Date
2012-02-02
Comment on data source
Bloomberg Business- Atama of Malaysia Plans Congo Palm -Oil Plantation, Ministry Says

Data source #8

Data source type
Research Paper / Policy Report
URL
http://www.redd-monitor.org/wordpress/wp-content/uploads/2013/02/Seeds-of-Destruction-February-2013.pdf
File
Comment on data source
The Rainforest Foundation- Seeds of Destruction : EXPANSION OF INDUSTRIAL OIL PALM IN THE CONGO BASIN: POTENTIAL IMPACTS ON FORESTS AND PEOPLe, February 2013

Data source #9

Data source type
Other (Please specify in comment field)
URL
https://www.farmlandgrab.org/27492
File
Date
2017-09-24
Comment on data source
Interview with researcher in the country. Article first appeared on WRM (World Rainforest Movement) website under bulletin 233 September 2017- link to bulletin on website not working.

Data source #10

Data source type
Company sources
URL
http://www.wahseong.com/index.php?option=com_content&view=article&id=727&Itemid=55
File
Comment on data source
Company website

Data source #11

Data source type
Media report
URL
http://www.farmlandgrab.org/post/view/22258
File
Date
2013-06-24
Comment on data source
Farmland Grab -- Congo: Détruire 180.000hectares de forêts pour planter des palmiers à huile

Data source #12

Data source type
Media report
URL
http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=270126685
File
Comment on data source
Bloomberg Businessweek- Atama Plantations

Data source #13

Data source type
Company sources
URL
http://www.wahseong.com/investor-relations/
File
Comment on data source
2014 Annual Report

Data source #14

Data source type
Research Paper / Policy Report
URL
https://www.grain.org/article/entries/5958-failed-farmland-deals-a-growing-legacy-of-disaster-and-pain
File
Date
2018-06-06
Comment on data source
Grain- Failed farmland deals: a growing legacy of disaster and pain

Data source #15

Data source type
Research Paper / Policy Report
URL
https://www.rainforestfoundationuk.org/central-africas-rainforests-and-people-suffering-from-the-expansion-of-palm-oil-and-rubber-plantations
File
Publication title
Palmed Off: An investigation into three industrial palm oil and rubber projects in Cameroon and the Republic of Congo.
Date
2019-05-01

Data source #16

Data source type
Media report
URL
https://asia.nikkei.com/Business/Markets/Nikkei-Markets/Malaysia-s-Wah-Seong-Corporation-To-Sell-Unit-WS-Agro-Industries-For-6-Mln
File
Publication title
Malaysia's Wah Seong Corporation To Sell Unit WS Agro Industries For $6 Mln
Date
2017-12-21

Data source #17

Data source type
Media report
URL
https://www.thestar.com.my/business/business-news/2016/10/17/wah-seong-to-exit-plantation-business/
File
Publication title
Wah Seong open to exit plantation business
Date
2016-10-17
Local communities / indigenous peoples

Names of communities / indigenous peoples affected

Comment on communities / indigenous peoples affected
Official documents show that 17 villages can be affected by the plantation, Rainforest UK estimate that more than 70 villages are affected in different ways.

Consultation of local community

Community consultation
Not consulted
Comment on consultation of local community
RainForest foundation report "Palmed Off" details the community engagement which occurred- which is not considered consultation of the project.

How did the community react?

Comment on community reaction
No evidence that a social impact assessment study was undertaken.

Presence of land conflicts

Comment on presence of land conflicts
Land conflicts could be present, but can't be confirmed. Some of the land allocated to the company was already subject to land claims by communities.

Displacement of people

Comment on displacement of people
The developments forces them to hunt very far from their villages and they are “almost being driven off their land”.

Promised benefits for local communities

Promised benefits for local communities
Health
Education
Roads
Other
Comment on promised benefits for local communities
Atama promises Corporate Social Responsibility actions to contribute to the communities. It does not provide any details as to how it will deliver on theses promises. The annex of the contract states the company will support agricultural production activities, supply medicine to clinics, provide supplies to schools, maintain roads and water sources, and leaving a community development zone of a radius of 3-5km around the villages.

Materialized benefits for local communities

Comment on materialized benefits for local communities
The community states that they have received no benefits (2017). The community and company can not exchange effectively about the benefits as there is a language barrier.
Former use

Former land owner (not by constitution)

Former land owner
State

Former land use

Former land use
Forestry
Conservation
Comment on former land use
the majority of the area slated for conversion for the Atama plantation is virgin rainforest, housing many endangered species (including chimpanzees, gorillas, and forest elephants). Much of this forest would almost certainly be classified as being of ‘high conservation value’ (HCV) according to standard definitions. No evidence that an environmental impact assessment study was undertaken. Other reports state the area granted to the company overlaps with a national park and a Ramsar site.

Former land cover

Former land cover
Forest land
Comment on former land cover
Around 28,000 hectares of the allocated concession land appears to overlap with a proposed new National Park, Ntokou-Pikounda, which was announced in 2006 and is in the last stage of formal establishment. Peatlands of high value conservation.
Produce info

Detailed crop, animal and mineral information

Crops area
Oil Palm

Use of produce

Has domestic use
Yes
Has export
Yes
Comment on use of produce
Majority for export.

In country processing of produce

In country processing of produce
Yes
Comment on in country processing of produce
Palm oil. The waste material will generate electricity. Processing plant expected to be running by 2017- processing plant still not completed (2017).
Water

Water extraction envisaged

Water extraction envisaged
Yes
Overall Comment

Overall comment

Overall comment
The company is accused of illegal selective logging- logging o expired permits and in areas where no permit was obtained. There are also claims that no environmental and social impact assessment was carried out.
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Feb. 15, 2013, 5:01 p.m.

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