A ban on the clearing of tropical forests in Indonesia is on the verge of being extended in a historic deal that could protect some of the world's most threatened habitats.

Indonesia is home to about a third of the world's remaining tropical forests, which provide a habitat for endangered species such as the orangutan and Sumatran tiger.

For the past two years the government has imposed a moratorium on felling forests in an effort to halt the deforestation that has laid waste to much of the country's virgin habitat and cleared the way for plantations of palm oil and pulp, paper and timber businesses.

But that moratorium is about to expire, and the termination would leave loggers and plantations free to expand into fresh areas.

Reports from agencies and local press on Friday night suggested the country's president, Susilo Bambang Yudhoyono, was about to sign up to an extension of the deal.

Reuters quoted an unnamed government official who said the fresh agreement would be signed within a few days.

The extension would be a big victory for green campaigners.

Greenpeace last year helped broker a key deal with Sinar Mas, owner of vast pulp and paper and palm oil interests in the region. That deal will help prevent further deforestation, and restore swathes of forest now degraded by the encroachment of loggers and plantations.

John Sauven, executive director of Greenpeace UK, said: "Extending the moratorium for another two years in Indonesia is good news for the climate and for increasingly endangered species such as the orangutan and Sumatran tiger.

"Indonesia's rainforests need protection from relentless exploitation by palm oil, and pulp and paper companies."

He said the decision would hopefully be welcomed by all the corporations in Indonesia and around the world that claimed to want zero deforestation.

But many palm oil planters have opposed the moratorium. The Jakarta Globe quoted a spokesman for the Association of Indonesian Palm Oil Producers who said the ban caused Indonesia to be overtaken by Malaysia as the world's biggest producer of palm oil.

"We firmly reject any proposal to extend this moratorium because we stand to lose more than we gain from it," the spokesman said.

Deforestation is one of the biggest sources of carbon dioxide emissions, which this week were found to have reached the highest atmospheric concentration in recorded human history. Scientist predict that if emissions continue to rise the world will experience devastating degrees of warming within several decades.