The Indonesian government, in cooperation with a Japanese counterpart, on Tuesday launched the development of its first bioethanol plant in Mojokerto, East Java.
“It is our first molasses–based ethanol plant. The project will later run in other state-owned enterprises but with other crops, such as sorghum,” said State-Owned Enterprises Minister Dahlan Iskan.
Dahlan was speaking at a ceremony that marked the start of the bioethanol factory project, which is owned by state-owned plantation company PT Perkebunan Nusantara (PTPN) X, on Tuesday.
The factory, which is being developed on 6.5 hectares of land in Gedeg district in Mojokerto, will have a production capacity of 30 million liters of bioethanol with a purity level of 99.5 percent.
The plant is the result of a partnership between the Industry Ministry and the Japanese government via the New Energy and Industrial Technology Development Organization (NEDO), Japan. The project will cost Rp 461.21 billion (US$42.9 million). NEDO will cover Rp 150 billion while PTPN X will allocate Rp 311.21 billion from its internal budget.
Dahlan said bioethanol products manufactured by PTPN X would be used by state-owned oil and gas company PT Pertamina for the mixture of Premium fuel.
“So, Pertamina must buy bioethanol from PTPN X,” he said.
The minister said the use of bioethanol as fuel was mandated in a 2013 decree by the Director General of New and Renewable Energy and Energy Conservation on bioethanol specifications marketed in domestic markets.
