Land Acquisition and Resettlement Plan

Resettlement Plan Document Stage: Revised Project Number: 39928 July 2006

INO: South Sumatra - West Java Phase II Gas Pipeline Project Prepared by PT. Perusahaan Gas Negara Tbk (PGN) The resettlement plan is a document of the borrower. The views expressed herein do not necessarily represent those of ADBs Board of Directors, Management, or staff, and may be preliminary in nature.

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ABBREVIATIONS

ADB - Asian Development Bank AH - Affected Household AP - Affected Person BPN - Badan Pertanahan Nasional DKI - Daerah Khusus Ibukota CDP - Community Development Program EIA - Environmental Impact Assessment GOI - Government of the Republic of Indonesia KEPPRES - Keputusan Presiden KUD - Koperasi Unit Desa LARP - Land Acquisition and Resettlement Plan LKMD - Lembaga Ketahanan Masyarakat Desa NGO - Non Government Organization NJOP - Nilai Jual Objek Pajak PERPRES - Peraturan Presiden PGN - PT Perusahaan Gas Negara (Persero) Tbk PU - Pekerjaan Umum PKBL - Program Kemitraan dan Bina Lingkungan RoW - Right of Way SEIA - Summary Environmental Impact Assessment SES - Socio Economic Survey SSWJ - South Sumatra West Java SSWJ phase II South Sumatra West Java Gas Transmission Project phase II

WEIGHTS AND MEASURES

mmscfd - million standard cubic feet per day ha - Hectare km - Kilometer m - Meter m2 - square meter

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GLOSSARY

Adat land Land held by customary community

Affected Persons,or households

People (households) who, on account of the project, stand to lose all or part of their physical and non-physical assets, including homes, communities, productive lands, resources such as forests, range lands, fishing areas, or important cultural sites, commercial properties, tenancy, income-earning opportunities, social and cultural networks and activities.

Walikota/Regent Head of Kabupaten / District / Regency.

Compensation Payment in cash or kind for loss of assets, resources or income.

Consultation A process of mutually listening, giving and accepting opinions and aspirations, based on equality between the land right holder and the party requesting the land in order to reach agreement on the form and amount of compensation.

Entitlement Range of measures comprising compensation, income restoration, transfer assistance, income substitution, and relocation to which APs are due, depending on the nature of their losses, to restore their economic and social base.

Governor Head of a Province.

Income restoration Programmes and/or activities designed to re-establish income sources and livelihoods of people affected

Kabupaten Regency / District

Kecamatan Sub-district

Land Acquisition Committee

A committee, which consists of local government officials, given the tasks to make an inventory of land and other assets on land to be acquired, to investigate the legal status of the land, to inform and negotiate with the people affected and with the agency acquiring the land, to estimate compensation, and to document and witness the compensation payments.

Regent/Walikota Head of a Regency / District / Kabupaten.

Relocation The physical shifting of an AP from their present place of residence to another location.

Replacement cost Cost of replacing lost assets and incomes, including cost of the transactions.

Land Acquistion and Resettlement Plan(LARP)

A time-bound action plan with budget setting out resettlement strategy, objectives, entitlement, actions, responsibilities, monitoring and evaluation.

Vulnerable groups Distinct groups of people who might suffer disproportionately from resettlement effects.

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CONTENTS

ABBREVIATIONS II

WEIGHTS AND MEASURES II

GLOSSARY III

CONTENTS IV

LIST OF TABLE V

LIST OF FIGURE V

LIST OF APPENDIXES V

EXECUTIVE SUMMARY 1

I. PROJECT DESCRIPTION 5

II. SCOPE OF LAND ACQUISITION AND RESETTLEMENT 5

III. SOCIO-ECONOMIC INFORMATION OF AFFECTED PERSONS 8

IV. INFORMATION DISSEMINATION, CONSULTATION, PARTICIPATORY APPROACHES AND DISCLOSURE REQUIREMENTS 10

V. GRIEVANCE REDRESS MECHANISMS 11

VI. POLICY AND LEGAL FRAMEWORK 11

VII. ELIGIBILITY AND ENTITLEMENTS 15

VIII. RELOCATION OF HOUSING AND SETTLEMENT 18

IX. INCOME RESTORATION AND REHABILITATION STRATEGY 18

X. BUDGET AND FINANCING 18

XI. IMPLEMENTATION SCHEDULES 19

XII. INSTITUTIONAL FRAMEWORK FOR LAND ACQUISITION AND RESETTLEMENT 20

XIII. MONITORING AND EVALUATION 22

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LIST OF TABLE

Table 1. Summary of LARP entitlement budget 3 Table 2. Summary of Land Acquisition Schedule 4 Table 3. Affected Land Owners, Title and Structures 6 Table 4. Population and Population Density of the Project Area 7 Table 5. Summary of Risk and Impact of Land Acquisition 7 Table 6. Amount of Land to be Acquired (Ha) 8 Table 7. Population and Population Density of the Project Area by Regency 9 Table 8. Main Occupation by Gender 9 Table 9. Entitlement Matrix 17 Table 10. Summary of LARP entitlement budget 19 Table 11. Land Acquisition Implementation Schedule 20

LIST OF FIGURE

Figure 1. Map of South Sumatra West Java Gas Transmission Project 6 Figure 2. Organization of Environmental, Land Acquisition and Community Development 22

LIST OF APPENDIXES

Appendix 1 Company profile PJT II 26 Appendix 2 Percentage of Land Title acquired from APs 27 Appendix 3 Socio-economic data 28 Appendix 4 Minutes of a Land Acquisition Socialization Meeting 29 Appendix 5 Grievance Redress Mechanism 32 Appendix 6 Composition of Land Acquisition Committees 33 Appendix 7 GOI / ADB / PGN Gap Analysis 37 Appendix 8 Confirmation of AP Acceptance of Cash Compensation 40 Appendix 9 Land Acquisition Process and The Role of Institutions Involved 42 Appendix 10 Land Acquisition Compensation Payment Progress Report 43 Appendix 11 LARP External Monitoring Inception Report 44

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EXECUTIVE SUMMARY

1. The proposed South Sumatra West Java Gas Transmission Project (the Project) will transport natural gas from the Grissik gas production field in South Sumatra Province to Rawa Maju in West Java Province to meet the rising energy demand in West Java. The capacity of the Project pipeline is 460 million standard cubic feet per day (mmcsfd).

2. The Project is 661 km of onshore and offshore pipe construction. Field survey established the selected onshore pipeline alignment as the most appropriate because it minimizes the number of houses, persons and forest ecosystems affected. Total area of land acquired is 1,137.76 ha in South Sumatra and Lampung provinces dominated by agriculture land such as rice fields, traditional plantations, drylands and arable homesteads. The project will have no impact on any shops, commercial or industrial establishments, and no social facility structures will be affected by the Project. In South Sumatra and Lampung provinces there is no resettlement requirement for the APs. In West Java there is no land acquisition or resettlement; the 34 km of land required will be leased by PGN from Perum Jasa Tirta II (PJT II). The land to be used in West Java is not in productive use as it is within the Right of Way (RoW) for a drainage canal.

3. The proposed gas transmission pipeline RoW will require the acquisition of land and other fixed assets along the proposed alignment. Following Asian Development Banks (ADB) guidelines, this Project is a category A Land Acquisition and Resettlement Plan (LARP), because 4,298 persons are affected and some of these Affected Persons (APs) have lost more than 10% of their income generating assets by this project, so a full LARP has been prepared.

4. PGNs LARP is prepared adhering to the laws and regulations of Indonesia, and all requirements of the ADB policy on involuntary resettlement as detailed in the ADB Handbook on Resettlement and the ADB Handbook on Poverty and Social Analysis (2001) as guidelines. PGNs Policy Framework on Land Acquisition and Resettlement (Policy Framework) is committed to enhance the quality of life of the APs, and to prevent or mitigate any possible adverse social impacts.

5. A socio-economic survey indicated that 64% of the population in affected villages is in the productive age (15 55 years). The majority of households contain 5 - 8 members. The average level of education is elementary and junior high school level. Skills are limited mostly to carpentry, mechanical, transportation, and handicrafts. The socio-economic survey indicated that for adults, farming is the main occupation (88.3% male and 78% female). Secondary occupations for males include daily wage laborers (4%), civil servants (4%), and traders (2.7%); while for females, small retailing of food crop products (11.4%) is the secondary occupation.

6. The survey found no communities of indigenous people in the Project area. None of the communities along the RoW is isolated with a closed-economic system.

7. The impact of the Project on APs can be expressed in terms of change of land ownership, reduction of income due to loss of agricultural land, loss of crops, and loss of structures including houses. In South Sumatra and Lampung provinces the Project will acquire 951.42 ha of privately owned land from a total 4,315 land owners, and 186.34 ha from a total of 17 corporate land owners. These corporations are involved in commercial plantations.

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8. A total of 28 structures in South Sumatra province and 12 in Lampung province with an average area of 50.5 m2 will be affected by the Project. The structures affect