Whistleblower on Sabah’s Nature Conservation Agreement: “An obvious con”

By Chris Lang

In November 2021, John C. Cannon, a journalist with Mongabay, wrote about a Nature Conservation Agreement between the Sabah State Government and an unknown company called Hoch Standard Pte Ltd, based in Singapore. The deal sets up a carbon trading deal covering an area of more than two million hectares for at least 100 years. Hoch Standard would pocket 30% of the revenue from the project.

Cannon wrote two more articles about the carbon trading deal in November and December 2021.

REDD-Monitor wrote two posts in December 2021. The first post outlines the problems with the Nature Conservation Agreement, the controversy in Sabah – including a letter from the State Attorney-General to Hoch Standard, and looks at the hair-raising background of two of main promoters of the deal, Sabah’s Deputy Chief Minister, Jeffrey Kitingan, and Stan Lassa Golokin:

In the 1980s and 1990s, Kitingan and Golokin were both involved in the Sabah Foundation which was supposed to be carrying out logging operations on a “sustained yield basis”. In fact, the forests were plundered and billions of dollars went missing.

REDD-Monitor’s second post came when the Nature Conservation Agreement was leaked in mid-December:

On 30 November 2021, Adrian Lasimbang, a former senator and Indigenous rights activist, filed a lawsuit with the High Court in Sabah and Sarawak against the state of Sabah.

Whistleblower: “An obvious con”

Last week, Ian Neubauer, a journalist with Al Jazeera, picked up the story.

“It makes me sick to my stomach,” a whistleblower with firsthand knowledge of the Nature Conservation Agreement told Al Jazeera. The whistleblower spoke “on condition of anonymity due to fears of retaliation,” Neubauer writes.

The whistleblower said that,

I got involved in this deal because I knew that if we did it right, Sabah could become the world leader in the monetisation of natural capital and carbon credits. But instead, we created a template other countries can use to pilfer and abuse the system.

“Dr Jeffrey is getting old and I think he is not as sharp as he was because this deal is such an obvious con,” the whistleblower commented. “He’s been misled to think that all we have to do is sit back and the money will come rolling in – the same story we Sabahans were sold in the 1990s with logging. But today carbon is the new gold. I don’t even think he knows he did anything wrong by doing the deal in secret.”

Peter Burgess, Tierra Australia

When Peter Burgess, the CEO of Tierra Australia, an Australian company that brokered the agreement spoke to Mongabay in November 2021, he explained that a process of free, prior and informed consent was not carried out. “If we had to go and sit around every campfire, it would never happen,” Burgess said.

Burgess told Al Jazeera that, “I own a very small company which specialises in analysing [water] catchment functions. We have never been a carbon company, currently not a carbon company and never plan to be one.”

But on 10 November 2021, Yin Shao Loong, a senior research associate at the Khazanah Research Institute, posted a series of screenshots on his Twitter account of Burgess speaking at the virtual International Heart of Borneo conference.

One of Burgess’ slides states,

Enable digital connection into the US$ trillion Carbon, ESG & Green Bond Markets instead of heavy reliance on philanthropy (HOB), ethical investment (HOB), tourism and agriculture which is highly dictated by the physical world economy

Another slide refers to a carbon market of certified emissions reductions worth US$16 trillion.

And another claims that,

Natural Capital Custodians, Indigenous people, global communities and future generations will be the ultimate beneficiaries of conservation and monetisation of the world’s Natural Capital Assets.

“Blockchain underpinned by AI, ML & big data will,” according to Burgess, “eliminate corruption, enhance transparency and deliver immutability, integrity, quality, speed, scale and auditing capability of global NC Projects.”

During the Heart of Borneo webinar, Cynthia Ong, founder of Land Empowerment Animals People in Sabah, asked Peter Burgess the following question:

You emphasise transparency a few times; can you tell us more about the story that came out in Mongabay today concerning a deal that has been signed with Sabah that Sabahans have not been informed about?

Burgess did not answer this question and it was quickly deleted from the chat. Ong subsequently wrote an article for Mongabay about the Nature Conservation Agreement.

Tierra Australia and Hoch Standard

In September 2021, Peter Burgess was a co-author of a paper titled, “Building a Platform and Economic Model to Actualize the Value of Nature Capital to Incentivize Preservation and Conservation over Exploitation of Australian Aboriginal Cultural their Nature Capital Assets and the Nature Capital Assets of the State of Western Australia, the Northern Territory and Sabah Malaysia.”

The paper states that Tierra Australia has partnered with Hoch Standard (and Harvard University, MIT, Cornell University, and the ALCES Group) to develop a

platform, infrastructure and NC intervention strategies for the measuring, storing, and trading of Nature Capital gross productive value (corollary to GDP) with the short term goal of providing greater return on investment for conservation and preservation of NC rather than exploitation of it, and a long term goal of using NC and its productive value as the underlying asset for a stable universal medium of exchange.

The paper also states that a Nature Conservation Agreement was “established” with Sabah on 7 August 2021. Clearly Tierra Australia had big plans to become a carbon company, despite Burgess denying this to Al Jazeera.

Hoch Standard not backed by Temasek

A corporate presentation by Hoch Standard and Tierra Australia mentions Temasek as a partnering financial institution. Temasek is Singapore’s state-owned investment agency.

And on 19 November 2021, at a public meeting in Kota Kinabalu, Sabah’s Deputy Chief Minister Jeffrey Kitingan said “Hoch Standard is a global player, it is backed by Temasek Holding.”

A spokesperson for Temasek told Al Jazeera “we have not been able to identify any link we may have with Hoch Standard”.

When Al Jazeera asked Kitingan about Temasek, he admitted that Hoch Standard was not in fact backed by Temasek.

Kitingan threatens to sue Al Jazeera and Lasimbang

On 4 February 2022, Kitingan put out a statement, suggesting that he knows who the whistleblower is:

Clearly, both Al Jazeera and Lasimbang formed their opinions on the topic based on lies and falsehood fed to them by an individual whose motive is to gain political mileage and instigate the indigenous communities by defaming me.

Kitingan said that the whistleblower was “hell-bent to discredit the deal and even set up his own group to take over the deal”.

Kitingan added that,

I am considering legal action against Al Jazeera and Lasimbang and others who are actively disseminating false information to the public, particularly those that are defaming my name.

Lasimbang welcomed Kitingan’s response. In a statement he said that,

It is in the public interest should he sue me he can clear the air about this controversial and secretive deal.