Two Indonesian plantation workers have been arrested for allegedly killing at least 20 endangered orangutans and proboscis monkeys as a means of "pest control", police have said.

Colonel Antonius Wisnu Sutirta, a police spokesman, said the suspects had admitted chasing the primates with dogs before shooting, stabbing or hacking them to death.

The men allegedly told the authorities that the owners of several palm oil plantations on Borneo island, keen to protect their lucrative crops from being raided, offered a reward for every orangutan and long-nosed proboscis monkey killed.

If found guilty of violating the Indonesian law on national resources conservation, the plantation workers face up to five years in prison, Sutirta said.

Indonesia, home to 90% of the orangutans left in the wild, has lost half of its rain forests in the last half century in its rush to supply the world with timber, pulp, paper and palm oil.

The remaining 50,000 to 60,000 apes live in scattered, degraded forests, putting them in frequent and often deadly conflict with humans.

A study published this month in the PLoSOne journal said villagers in Kalimantan, the Indonesian portion of Borneo, admitted to slaughtering at least 750 orangutans over a year-long period – a much higher figure than previously thought.

Some were killed to protect crops, and others because villagers thought they were dangerous. A much smaller number were hunted for their meat, the study revealed.

"The simple conclusion is that orangutans will be hunted to extinction unless someone stops the killings," Erik Meijaard, the study's main author, said.

"It's a blatant infringement of Indonesia's conservation laws. I really hope that both the perpetrators and the plantation managers who ordered the killings will be punished accordingly."

The two men were arrested at their homes in Muara Kaman, a village in east Kalimantan, on Sunday after the bones of several orangutans and proboscis monkeys were recovered.

Yaya Rayadin, a researcher from Mulawarman University, in the Kalimantan town of Samarinda, said the bones were scattered in 15 different places and that tests indicated the deaths had been violent. Most had hack marks on their skulls, jaws and ribs, he said.

Rayadin said he believed many more people were involved in the killings, adding that he had first told authorities that palm oil plantations were offering rewards to locals who slaughtered orangutans or monkeys in 2008, but no action had been taken until now.

"The fact police have arrested two people is a sign of remarkable progress," he added. "But the main thing now is to find a way to protect the orangutans that are still alive."