The 297-foot (90.6 meter) MS Caledonian Sky crashed into the reefs at Raja Ampat on March 4. Raja Ampat is frequently included on lists
of the the world's most beautiful coral reefs and is often described as an "untouched" beach paradise.
"The destruction of Raja Ampat coral reefs, which were developed by nature for hundreds of years, was done in less than one day by Caledonian Sky and its captain," Djoko Hartoyo, of the Information and Law Bureau of the Coordinating Ministry for Maritime Affairs, said in a statement. "It is simply impossible to restore that part of Raja Ampat. Fish that were normally seen in that particular area were all gone."
Nearly 140,000 square feet (more than 13,000 square meters) of reef were destroyed, Ketut Putra, the vice president of Conservation International Indonesia, told CNN. The ship crashed into one of the best diving areas, he said.
Noble Caledonia, the cruise company that operates the vessel, apologized for the incident. It said in a statement that the ship went aground, but did not give a reason why.
"We are working with local experts to understand how we can assist with the regeneration of the reef. We value our relationships around the world with local people and we are sorry to have impacted the local community," the statement said.
The company said it will establish a fund to help the local economy and help pay for repairs.
But residents are outraged.
"The damage done to the reef is not only a disaster from an environmental point of view, but also due to the fact that the livelihoods of local communities depend upon healthy reefs," Doug Meikle, who runs a website supporting the work of the local Papuan community's tourist accommodation association, told CNN in an email. "It's quite remarkable that the ship was so close."
Ruben Sauyai, who owns the nearby Koranu Fyak Bungalows and is the president of the professional divers association in Raja Ampat told CNN he was about 200 feet away with some divers when the incident happened.
"You could hear it crush the reef," he said.
Meikle believes there's a strong case to ban ships like this from the area.
"Quite apart from the risk of accidents, just anchoring such ships does incredible damage to reefs."
Criminal charges coming?
Though insurance could pay for some of the environmental damage, Indonesian authorities said they believe the captain committed a crime and could face prison time if convicted.
"Insurance company may be willing to pay the environmental damage, but it does not absolve criminal side of the case," authorities said.
The company described the master on duty at the time of the crash as "one of the world's leading expedition captains" and said he had many years of experience.
A symptom of a larger problem
The crash could affect the local tourism industry and the economy.
Putra told CNN the damaged reef won't attract as many tourists, and the number of fish in the area will be reduced because of their damaged habitat.
"I'm actually worried," he said.
Cruise ships themselves are a source of dangerous pollutants that threat coral reefs -- especially in Southeast Asia, according to the industry website Marine Insight.
The ships "are often found flushing their enormous amount of sewage and food waste and oily bilge water as a suspension of insoluble particles, into the ocean."
A 2016 study in the journal Nature
found that the shipping industry also produced a significant amount of carbon dioxide in Asia.
But coral reefs from around the globe remain under threat from environmental problems as well.
The Great Barrier Reef suffered its most devastating die-off on record last year, according to a report from the ARC Centre of Excellence for Coral Reef Studies.
The report linked the rise in destructive bleaching events to warmer water temperatures.