MARKET DEVELOPMENT
Pertamina Ups Biofuel Quota, Signs on 11 Producers
Pertamina Ups Biofuel Quota, Signs on 11 Producers
23/11/2015 (Jakarta Post) - State-owned oil and gas giant PT Pertamina has projected an absorption of 5.14 million kiloliters (KL) of fatty-acid methyl ester (FAME) – a derivative of palm oil – next year, to meet the mandated 20 percent biofuel blend in its projected 26 million KL of biodiesel.
The projection represents a five-fold increase on Pertamina's current FAME absorption of 966,785 KL which supplies its current biodiesel output of 5.98 million KL. Thus, the company has signed supply contracts with 11 FAME biofuel producers to procure 1.84 million KL of FAME to cover its needs up until April next year.
Pertamina’s vice president of corporate communications Wianda Pusponegoro said the signing was a concrete step toward complying with the government’s mandatory biodiesel (BBN) policy. The policy mandates a 15 percent biofuel blend this year and a 20 percent blend starting next year. A “15 percent blend” means fuel made up of 15 percent FAME and 85 percent petroleum.
"A sustainable supply of FAME is very important for supporting the government's mandatory biofuel program," said Wianda in a press statement on Friday.
From 5.14 million KL of FAME being purchased next year, a total of 2.6 million KL will be used for public fuel as part of Pertamina’s public service obligation (PSO) program, 1.26 million KL will be used by power plants and 1.12 million KL will go toward non-PSO fuel.
Wienda explained that Pertamina's strategic synergy with other stakeholders in the biofuel program, both the government and FAME producers in Indonesia, is indispensable.
"FAME absorption is believed to be highly beneficial to all parties, because this is an important step for Indonesia in reducing its dependency on imported oil and creating jobs in the downstream oil industry," she added.
Currently, Pertamina has distributed FAME biodiesel with a blending portion of 15 percent. The total FAME absorption up until Oct. 31 was approximately 300,000 KL.
The projection represents a five-fold increase on Pertamina's current FAME absorption of 966,785 KL which supplies its current biodiesel output of 5.98 million KL. Thus, the company has signed supply contracts with 11 FAME biofuel producers to procure 1.84 million KL of FAME to cover its needs up until April next year.
Pertamina’s vice president of corporate communications Wianda Pusponegoro said the signing was a concrete step toward complying with the government’s mandatory biodiesel (BBN) policy. The policy mandates a 15 percent biofuel blend this year and a 20 percent blend starting next year. A “15 percent blend” means fuel made up of 15 percent FAME and 85 percent petroleum.
"A sustainable supply of FAME is very important for supporting the government's mandatory biofuel program," said Wianda in a press statement on Friday.
From 5.14 million KL of FAME being purchased next year, a total of 2.6 million KL will be used for public fuel as part of Pertamina’s public service obligation (PSO) program, 1.26 million KL will be used by power plants and 1.12 million KL will go toward non-PSO fuel.
Wienda explained that Pertamina's strategic synergy with other stakeholders in the biofuel program, both the government and FAME producers in Indonesia, is indispensable.
"FAME absorption is believed to be highly beneficial to all parties, because this is an important step for Indonesia in reducing its dependency on imported oil and creating jobs in the downstream oil industry," she added.
Currently, Pertamina has distributed FAME biodiesel with a blending portion of 15 percent. The total FAME absorption up until Oct. 31 was approximately 300,000 KL.