More overseas firms are showing interest in developing the bioenergy sector here, with a British oil giant and a Swedish energy firm being the latest to join the list, bringing investment commitments in the sector to Rp 160 trillion (US$17.7 billion).
Alhilal Hamdi, head of the government's biofuel development committee, said Monday that BP Plc., and its partner, D1 Oil Plc., had allocated $160 million for developing the industry in India, Africa and Indonesia -- most of which would be spent on the development of 1 million hectares of plantations here.
Speaking Monday, he added that last March, Sweden's Bioenergy had signed a memorandum of understanding (MoU) for the development of 100,000 hectares of jatropha plantations in East Nusa Tenggara.
He estimated the value of this investment at around $200 million as the company was also planning to build a biofuel plant with a capacity of 350,000 tons per day.
Purnomo Yusgiantoro, Energy and Mineral Resources Minister, said on the same occasion that Indonesia needed a total investment of Rp 200 trillion until 2010 to be able to develop up to 5.25 million hectares of biofuel feedstock plantations.
Of the Rp 200 trillion, Rp 185 trillion was expected to come from the private sector, while the remaining Rp 15 trillion would come from the state, he explained.
Under the government's biofuel plans, Indonesia wants to develop 5.25 million hectares of biofuel plantations in the next three years in order to produce 5.29 million kiloliters of biofuel per year by 2010.
It hopes that by 2025, biofuel production will account for some 5 percent of the country's energy mix, which is currently dominated by fossil fuels.
With the arrival of two more foreign companies, Purnomo said he was upbeat about the government meeting that target.
Indonesia has been seeking sources of renewable energy, including biofuels, in a bid to reduce its dependence on oil.
It has laid the foundations to become one of the world's top biofuel producers in the coming years with the signing of 58 agreements worth $12.4 billion with 59 energy firms and institutions in January.
Among the big companies on the list are China's major energy firms, CNOOC and Sinopec, Malaysia-based Genting Biofuels Asia and a number of local companies, including the Sinar Mas Group.
CNOOC is now in the process of building three biodiesel plants in West Kalimantan.
CNOOC signed an investment commitment worth $5.5 billion in January.
In addition, three Austrian companies -- Energea, BioDiesel International and the Christof Group -- said recently that they were interested in constructing biodiesel refineries, and have been involved in discussions with potential Indonesian partners.