Medan, N Sumatra (ANTARA News) - Three state plantation firms will cooperate in building a biodiesel plant with a capacity of 300,000 tons per year, a spokesman said.
"The three state firms will begin construction of the joint biodiesel plant in 2008 and the plant is expected to start operating in 2009," Hidayat, a spokesman of state plantation company PTPN IV, said here on Monday.
He however stopped short of revealing the amount of funds needed to build the plant, arguing that the three state firms were still discussing the percentage of their respective shares and the location of the plant.
To be sure, the plan to build the biodiesel plant was already in place, he said.
The plan to build the biodiesel plant was based on prospects for palm oil-based biodiesel, he said.
"Like CPO, demand for bioldiesel will be on the rise as petroleum deposits are shrinking," he said.
The government is planning to produce 200,000 barrels of biofuel a day by 2010.
Director for Energy Resources Development at the Agency for Assessment and Application of Technology (BPPT) Unggul Prayitno said last month the Finance Ministry is in the process of formulating two types of incentives to be offered to investors involved in biofuel projects,
The planned incentives consist of tax breaks and subsidized interest on loans.(*)