The Australian Government's aid agency, AusAID, has quietly ended an ambitious project in Indonesia to reforest and rehabilitate peatlands, with the aim of helping reduce carbon emissions.

The $100 million scheme was launched in 2007 with much fanfare, but nearly seven years on very few of the project's initial targets have been achieved.

In 2007, the then foreign minister Alexander Downer inaugurated the Kalimantan Forests and Climate Partnership.

He said it was a project that would make "a very real and very practical contribution to improving our environment" yielding "immediate and tangible results."

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The initial plan was to plant 100 million trees and rehabilitate 200,000 hectares of peatland and forests on the Indonesian island of Kalimantan by June last year.

That deadline was late extended to June this year.

But as of the end of 2012 only 2.5 million seedlings had been raised in nurseries and it is unclear how many of those had been planted.

Re-flooding peatlands, which were drained by former president Suharto to create land for rice production, was always an ambitious plan and not one that had been attempted elsewhere in the world.

But sources say no work has begun on the flooding of peatland, which is considered vital to curbing greenhouse gas emissions because they act as vast carbon sinks.

Director of ANU's Asia Pacific Network for Environmental Governance, Professor Luca Tacconi, says the reason behind ending the program is unclear.

"My impression would be from talking to various people that it's perhaps a political decision, because, somehow, it was seen as an unsuccessful project, from the outside at least," he said.

Conflicting views about AusAID's success

Professor Tacconi says it would be wrong to say the project has been a failure.

"They have done, I think in my perspective, a lot of work on both the more scientific side, in terms of looking at peatland science, on the engineering side about how to re-flood the peatlands," he said.

A large part of the Kalimantan project was developing awareness and building the capacity of local communities to better protect peatlands and forests and develop alternative livelihoods.

AusAID claims to have made considerable progress in this area, but not everyone agrees.

Patrick Anderson, from the NGO Forest People's Programme, says AusAID's decision to pull out of Kalimantan comes as no surprise.

"I've been visiting the site in central Kalimantan for a number of years and there isn't broad community support for the project," he said.

"I know also at the district government and provincial government level, there've been lots of questions about the project.

"There isn't broad support and the project was failing.

"So, a lot of funds spent and very little progress."

But Professor Tacconi says AusAID and its local partners had already progressed the plan beyond the planning and approval stage and Indonesia remains committed to rehydrating the peatland.

"My understanding from talking to colleagues in Indonesia government is that they had asked Australia to continue the project," he said.

"They thought that good progress had been made in terms of actually getting to the point where the practical outcomes could be seen in the field."

In 2008 and 2009, when the world was preparing for the Copenhagen Climate Conference, Australia had established itself as the second largest international donor in the fight to protect Indonesia's forests.

But the closure of the Kalimantan Forests and Climate Partnership effectively brings to an end Australia's practical contribution to this effort.

Professor Tacconi says its not yet clear what, if any, plans Australia might have for the future of the partnership.

"When I was in Indonesia a couple of weeks ago, there were a couple of major events and there was no Australian representative to those events.