16/09/05 ( CNN) - If completed, a section of rainforest nearly half thesize of the Netherlands will be destroyed in the Kalimantan region ofBorneo.

Currently 14 of the island's 20 major rivers originate in the region andit is one of only two places on earth where endangered orangutans,elephants and rhinos co-exist.

China has already agreed to pay most of the estimated US$560 million itwill cost to convert the area, which the government insists will not harmthe environment.

The World Wildlife Fund (WWF) disagrees. It says Kalimantan is located inan area known as the Heart of Borneo, which is the only remaining place inSoutheast Asia where forests can be conserved on a massive scale.

WWF's research shows that new species are being discovered in the regionat a rate of three per month, making it one of the richest areas ofbiodiversity in the world.

Dr Mubariq Ahmad, a chief executive director of WWF, says that if theproposed plantation is created, not only will it certainly result inenvironmental damage but it could also, "have long-lasting, damaging,consequences for the people who depend on the area and its massive waterresources, which feed the whole island."

Indonesia currently produces 36 per cent of the world's supply of palmoil, which is a semi-solid substance at room temperature and is usedaround the world in foods such as margarine, shortening, baked goods andcandies.

With a recent past haunted with serious labor issues and an unemploymentrate presently at 9.2 per cent, some of Indonesia's leaders and citizensview the new development and the estimated 100,000 new jobs it willcreate, as a good opportunity for economic improvement.

Derom Bangun, Chairman of the Indonesian Palm Oil Producers TradeAssociation, is one of those in favor of the proposed plantation.

He said: "Investment should be encouraged provided the environment istaken fully into consideration."

He said despite what organizations such as the WWF believe, IPOPTA is "notonly interested in the economic aspects of the business."

In 2002 a pact was signed by NGOs, financiers and farmers promising not todestroy any habitat that is home to endangered species or crucial to avillage's water supply.

"We only support the establishment of oil palm plantations that are basedon substantial and environmental principles." Said Dr Rosediana Suharto,Executive Chairman of the Indonesian Palm Oil Commission.

His job is to promote a positive image of the Indonesian palm oil industryand he says "consumers do not want to be associated with the destructionof the rainforest."

Opponents including Ahmad believe that a plantation in the mountainousregion of Kalimantan would be a reckless investment.

He said: "It doesn't make commercial or conservation sense to rip theforest out of the Heart of Borneo to plant a crop, which cannot grow inmountainous conditions.

Research has shown growing oil palm in areas above 200 meters results inlow productivity. Most of the Heart of Borneo area is between 1,000 and2,000 meters high.