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Planet Ark World Environment News Pertamina Launches Biodiesel Fuel Sales To Industry

Date: 12-Nov-08
Country: INDONESIA

In September, Indonesia issued a ministerial decree making the use of biofuel mandatory with effect from 2009.

Indonesia is the world's biggest producer of palm oil and has been pushing for the use of biofuels to help ensure the survival of its biodiesel industry.

Ari Soemarno, Pertamina's president director, told reporters that the ministerial decree meant the company now had guarantees over biofuel standards and supply.

"Pertamina will expand the biofuel market in future," he said.

Pertamina currently use a blend of 5 percent palm-based biodiesel and 95 percent diesel oil, selling in Java island to motorists.

Soemarno said Pertamina would extend its biodiesel market to pump stations in Sumatra and parts of Kalimantan and Sulawesi Island in 2009.

"Currently the market is mostly in Java island. We are targeting marketing biodiesel all over Indonesia by 2010," Soemarno said.

Pertamina has been selling biodiesel since 2006, but has varied the blend in its biodiesel fuel in response to volatile palm oil prices and due to the lack of a mandatory policy. Indonesia's combined capacity for biofuel using palm oil as a feedstock is 2 million kilo litres per year, but it is running at 20 percent of capacity, data from the national biofuel development team shows.

With the introduction of the mandatory policy, biodiesel capacity would rise to 5 million kilo litres a year by 2010, the government said recently, although it could also push up the price of palm oil.

(Reporting by Muklis Ali; Editing by Ed Davies)

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