20/02/2012 (Proactive Investors Australia) - Mission NewEnergy (ASX: MBT) is moving into the Indonesian market, acquiring an 85% interest in Singapore-based company Oleovest Pte, which holds a 70% equity stake in a newly formed palm oil joint venture in Indonesia.

The acquisition offers a new strategic direction for Mission, which is a global provider of sustainable renewable energy.

Mission has been seeking an opportunity to diversify into a more established and rateable business, and sees this deal as key to that.

PT Sinergi Oleo Nusantara, which is 30% owned by PT Perkebunan Nusantara III, is a special purpose company which will establish a new downstream palm oil and oleo-chemical complex in North Sumatra.

Mission will be required to invest about US$3 million to acquire the stake and fund initial operations in Sinergi.

The project will cost about US$200 million to build, and will be constructed in two stages, the first stage comprising a 600,000 tonnes per annum edible oil refinery, a 250,000 tonnes per annum Methyl Ester biodiesel plant and a 100,000 tonnes per annum Fatty Alcohol plant.

Of the capital expenditure, US$140 million will be arranged in debt, along with US$60 million in equity prior to construction.

The project is expected to take about three years to implement once it is fully funded.