Jakarta. Shares of state-controlled Semen Indonesia, the country's largest cement producer, dropped by almost 6 percent in Tuesday's trade at the Indonesia Stock Exchange after the Supreme Court revoked the environmental permit for its $320 million cement plant in Rembang, Central Java, putting the project's future at risk.
The shares dropped by as low as 5.8 percent to 9,700 a piece by 2.00 p.m. — its lowest in four weeks — trailing the benchmark IDX rate that dropped by 0.15 percent.
Semen Indonesia began building the Rembang plant in 2011 to replace a similar plant in nearby Pati, which was closed after its residents won a class action against the plant two years earlier.
Rembang residents have mounted a long court challenge to revoke the environmental permit for the Rembang project, which they said will destroy the unique karst ecosystem in the region and undermine their livelihood as farmers.
The farmers lost the initial trial at the Rembang District Court as well as their appeals at the High Court and the Supreme Court. They filed a judicial review against the latest verdict in May and this time the Supreme Court sided with the farmers.
Responding to the news, Central Java Governor Ganjar Pranowo said, as quoted by Antaranews.com, "The Central Java provincial government will abide by the Supreme Court's decision. That has been my commitment since the beginning."
Earlier in August, Semen Indonesia was forced to shelf its plan to start production on 3 million metric tons of cement from its Rembang plant by the end of this year, after President Joko "Jokowi" Widodo instructed his staff to conduct a further environmental study — called the KLHS — on the project.