Indonesia, Toyota in talks on potential bioethanol project in Lampung province

[JAKARTA] Indonesia is in talks with Japan’s Toyota Motor Asia on a potential joint investment in bioethanol production in the South-east Asian country, a government official and executives from Toyota said on Monday (Apr 20).

A renewable energy subsidiary of Indonesia’s state energy firm Pertamina is discussing a potential joint investment with Toyota Tsusho.

This is for a bioethanol plant in Indonesia’s Lampung province on the southern tip of Sumatra, said Deputy Investment Minister Todotua Pasaribu.

If they reach a deal, construction of a plant with a capacity of 60,000 kilolitres of bioethanol a year could start in the second half of 2026, with production eyed in 2028, he said.

A new 6,000-hectare sorghum plantation will produce the feedstock, Pasaribu added.

The estimated total cost of the investment is US$200 million to US$300 million, he said.

He noted that Japan’s Research Association of Biomass Innovation for Next Generation Automobile Fuels (raBit) is involved in the talks.

Speaking alongside Pasaribu, Masahiko Maeda, Toyota Motor Asia’s chief executive for the Asia region, said Toyota vehicles could use the bioethanol produced in the Lampung plant.

Pras Ganesh, an executive vice-president of Toyota Motor Asia, said on the sidelines of the press conference that discussions were still underway and a deal has not been reached.

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Indonesia has set a target to produce bioethanol using domestically available sources, such as biomass from palm oil, corn and sorghum, to reduce its reliance on imported fuels.

The country plans to impose a mandatory 10 per cent bioethanol content in petrol in 2028. REUTERS