01/10/2007 (Reuters), London - Protecting the environment is at the heart of Indonesia's future plans for palm oil production and companies caught destroying protected forests are being prosecuted, the country's agriculture minister said on Monday.

Anton Apriyantono said accusations of bad farming practice leveled by non-government organizations were not giving concerned European consumers the correct picture of palm oil production in Indonesia, set to overtake Malaysia this year as the world's top producer.

"Yes there is some uncommon practice destroying some forest land, we admit that, but this is not common practice," Apriyantono told Reuters in an interview in London.

"We will do our job to solve the problem. On forest fires, we have been prosecuting several companies. Some are already in jail," he added.

Palm oil, used as a food and in products ranging from cosmetics to biofuel, has come under fire from environmentalists in Europe and America who say the rapid expansion in palm cultivation is responsible for vanishing tropical forests and wildlife.

Scientists have warned biofuels are likely to speed up global warming as they have encouraged farmers to burn tropical forests that have absorbed a large portion of greenhouse gases.

Greenpeace says Indonesia had the fastest pace of deforestation in the world between 2000-2005, with an area of forest equivalent to 300 soccer pitches destroyed every hour.

EXPANSION IN THE BALANCE?

Indonesia has a palm oil planted area of around 6 million hectares, which is expected to expand by around 300,000 hectares per annum, Apriyantono said, adding that primary forest areas were not being disturbed for planting purposes.

But he said a campaign spearheaded by green groups, encouraging a boycott of palm oil from Indonesia and Malaysia had the potential to cause major damage to the their most important foreign currency earner.

"So far I don't think there's an effect in terms of value of the economy. But the political pressure is really high," Apriyantono said.

"A ban on palm oil in Europe would be big trouble for us because the palm oil industry is our heart in our country," he added.

A top Malaysian palm oil industry official said earlier on Monday that the campaign by environment groups against palm oil is costing the product market share in Europe.

Malaysia's Synergy Drive, the world's largest plantation company, has already launched a campaign to prevent a consumer backlash against its business.