JAKARTA (Reuters) - Indonesia's government said on Monday it would protect a strip of peatland in Aceh province at the centre of an international storm over palm oil development, in a case that had become a test of the country's commitment to halt deforestation.
Indonesia imposed a two-year moratorium on clearing forest last May under a $1 billion climate deal with Norway aimed at reducing emissions from deforestation, but the former governor of the country's westernmost Aceh province breached the ban by issuing a permit to a palm oil firm to develop the peatland.
This prompted legal action from environmental groups and probes by the police and several government bodies.
The resulting preliminary investigation showed that the permit was issued to palm oil firm Kallista Alam without following proper procedures, a government official said.
The forest, home to endangered orangutans, was partly cleared by burning, even before the permit was issued, said Mas Achmad Santosa, an official at the presidency.
"The case of Kallista Alam in Aceh is the typical problem we are facing ... some parts have been turned to palm oil plantations, some have been burned, and it turned out the permit does not exist," said Kuntoro Mangkusubroto, who is in charge of overseeing forestry sector reform.
He said the peatland would again be listed as a protected area.
Former Aceh governor Irwandi Yusuf issued the permit to open 1,605 hectares of land for palm oil in the Tripa peatland area in August last year.
Indonesia is the world's largest palm oil exporter and has seen rapid growth in production of the edible oil, used to make cooking oil and biscuits, in recent years.
(Reporting by Olivia Rondonuwu; Editing by Neil Chatterjee and Jeremy Laurence)