Nasdaq (03/04/2018) -  JAKARTA/KUALA LUMPUR, April 3 (Reuters) - Indonesia's energy ministry is aiming to allocate 3.46 million kilolitres for biodiesel in 2018, according to a government document seen by Reuters, a plan expected to boost consumption of the palm-based biofuel.

The mandatory biodiesel use is estimated to be expanded to include the train sector from May and the mining industry from July, according to the document from the Energy and Mineral Resources Ministry.

Indonesia, the world's top producer of palm oil, is pushing to increase the use of biodiesel to cut its oil import bill and curb greenhouse gas emissions. It is also pushing for wider biodiesel mandates to soak up palm oil supplies as the edible oil is used as feedstock to make biodiesel.

An official from the ministry confirmed the contents of the document but declined to be named because the details have yet to be made public.

The transportation and power plant sectors, which account for most of the country's biodiesel demand, are set under a B20 programme which requires a minimum 20 percent blend of bio content in diesel fuel.

The programme's expansion to the train and mining industries will begin at a B5 and B10 blend respectively, the document showed.

Indonesia started collecting a levy on its palm oil exports in 2015 - $50 per tonne for crude palm oil and $30 for processed palm oil products - and uses part of it to help fund its biodiesel subsidies.

The document also showed the ministry aims to allocate 1.47 million kilolitres of biodiesel for May-October to state-owned energy company PT Pertamina [RIC:RIC:PERM.UL] and private-owned PT AKR Corporindo Tbk.

Indonesia last allocated 1.41 million kilolitres of subsidized unblended biodiesel to the two energy companies for the November 2017-April 2018 period.

Writing by Fransiska Nangoy

 Read more at https://www.nasdaq.com/article/indonesia-plans-bigger-biodiesel-use-in-2018-govt-document-20180403-00347