INDONESIA TO FORM TEAM TO SETTLE GUTHRIE DEAL- MEDIA

JAKARTA, June 22 (Reuters) - Indonesia's central government and officialsin Riau province will set up a team to help settle the sale of vast oilpalm plantations to Malaysia's Kumpulan Guthrie , local mediareported on Friday.Months after Jakarta said the issue was closed, doubts still haunt thesale of 25 government-owned plantations in a deal worth around $345million, casting a shadow over Indonesia's plans to offload prime assetsto raise desperately-needed cash.The sale has been criticised by legislators and local officials in Riauprovince on Sumatra island, where most of the plantations are located.The Bisnis Indonesia newspaper said the team would look at remainingsocial and economic controversies surrounding the sale such as ownershipof land and the participation of local residents in running theplantations."A decision to set up the team was made in a meeting on June 14," thenewspaper quoted Imhar Effendy, head of the Riau government's plantationsoffice, as saying."Several parties are still lodging objections over the purchase."Effendy said he regretted the central government did not fully consultlocal authorities over the sale.Officials in Jakarta have repeatedly said results from a separatereview by a central government team showed there was nothing wrong withthe deal and that it was final.Former Finance Minister Prijadi Praptosuhardjo in March had proposedthat review.Critics have expressed concern the deal would lead to foreigndomination of the country's lucrative palm oil industry and triggerdemands for land compensation from local farmers.Indonesia is the world's second largest palm oil producer afterMalaysia. The sale was announced late last year.Analysts say Indonesia badly needs to put the Guthrie issue to rest toshow increasingly wary foreign investors they are being treated seriouslyin efforts to revive the ailing economy.