Indonesia, Toyota in talks on potential bioethanol project

A renewable energy subsidiary of Indonesia's state energy firm Pertamina is discussing potential joint investment with Toyota Tsusho 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 on a plant with capacity of 60,000 kilolitres of bioethanol per annum could start in the second half of 2026, with production eyed in 2028, he said.

A new 6,000-hectare (around 14,800 acres) sorghum plantation will produce the feedstock, Pasaribu said.

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

Japan's Research Association of Biomass Innovation for Next Generation ‌Automobile ⁠Fuels (raBit) is involved in the talks, Pasaribu said.

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, told Reuters on the sidelines of the press conference that discussions were still underway and a deal ⁠has not been reached.

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 mandatory 10% bioethanol content in gasoline in 2028.