SGX RegCo warns Bumitama, First Resources on haze disclosure

Regulator Seeks Haze Information

Singapore Exchange Regulation (SGX RegCo) has engaged listed companies with agricultural operations and plantations in Indonesia. The regulator is seeking details on whether their activities contributed to the ongoing haze, the impact of forest and peatland fires on their operations, and their response measures.

SGX RegCo stated on Friday, October 16, that it takes the fires seriously due to their effect on communities, the environment, and businesses. It warned of appropriate regulatory action if companies fail to meet their disclosure obligations under SGX Listing Rules.

Listed Firms Respond to Scrutiny

Among companies that have made announcements, Bumitama Agri stated on Friday that no evidence links its operations to the fire initiation or haze under investigation. The company noted an Indonesian authority record found one fire originated outside its concession before spreading in.

Bumitama Agri's shares fell 4.8 per cent, or S$0.09, to S$1.78 when last traded at 11:59 am on October 16, leading to a trading halt. First Resources also reported identifying hot spots around its West Kalimantan concessions, many verified as outside its operating boundaries. Its shares closed 6.9 per cent lower, or S$0.28, at S$3.80 on October 16. Both firms maintain zero-burning policies and use satellite monitoring.

NEA Issues Notices to Seven Firms

Separately, Singapore's National Environment Agency (NEA) has intensified its action against haze. On October 16, NEA identified seven other companies whose concession lands in Indonesia may have contributed smoke to Singapore. These firms include Bumi Andalas Permai and Sumatera Alam Anugerah.

NEA issued preventive measure notices under the Transboundary Haze Pollution Act, requiring them to deploy firefighters, cease burning, and submit fire prevention plans. Bumitama Agri and First Resources are not among these seven companies.

Air quality in Singapore deteriorated sharply, with the central region's 24-hour Pollutant Standards Index (PSI) reaching 229 at 3 pm on October 16, a new high for the year.

Heightened Scrutiny for Operators

The dual regulatory pressure from SGX RegCo and NEA shows increased compliance demands for plantation companies operating in Indonesia. Firms face higher operational costs for enhanced monitoring and firefighting, alongside potential fines for disclosure breaches or environmental damage.

This scrutiny could affect investor sentiment and capital flows into the sector, particularly for companies with significant Indonesian land banks. Investors will watch for further announcements from SGX RegCo and the named companies regarding compliance and operational impacts.