A billion-ringgit pulp-and-paper company the first in Sarawak in which a state government agency teamed up six years ago with the now-bankrupt Indonesian-owned Asia Pulp & Paper Ltd has been placed on official receivership, according to several lawyers familiar with the case.

Asia Pulp & Paper which had been de-listed from the New York Stock Exchange after running into debts it could not pay amounting to more than US$10 billion had a majority stake in Borneo Pulp & Paper Sdn Bhd, with the remaining stake held by the state-owned Sarawak Timber Industry Development Corporation (STIDC).

Reliable sources told malaysiakini that the state government had already taken several steps to protect its own interests in the company which had been earlier given massive tracts of land for tree plantation in Bintulu some of which are being opposed by local natives to support the proposed paper mill.

Lawyers that malaysiakini spoke to said they first heard of the receivership about two weeks ago when a case involving Native Customary Rights (NCR) land claim came up in the Kuching High Court against Borneo Pulp & Paper, and the defendant's counsel informed the court of the company's current status.

It is learnt there are several cases of NCR land claims pending against the company.

Last year, a NCR land claim came up in court involving Iban longhouse dwellers in the Bintulu area, and High Court judge Ian Chin in what was described as a landmark case ruled in favour of the claimants.

The receivership order is said to be connected with a large syndicate loan that Borneo Pulp & Paper obtained, but apparently it had failed to service interests on amounts already drawn. This is believed to involve about RM100 million.