The Sinar Mas Group has signed a deal with U.S. energy firm, Fulcrum Power Services, to build a biodiesel plant with an initial capacity of 400,000 tons a year, a company official said on Friday (4\/5\/07).<\/p>\n
The plant will be built in Dumai on Sumatra and should start producing fuel next April, Danny Jozal, the alternative energy chairman at Sinar Mas, told Reuters by telephone.<\/p>\n
The plant is expected to cost $60 million and capacity may be raised to 1 million tons from an initial 400,000 tons, he added.<\/p>\n
The official said one of the diversified group's units, PT Bio Energi Mas, signed the joint venture on Thursday with Houston, Texas-based Fulcrum. "Sinar Mas has a 50% share in the joint venture company. It will process palm oil, olein, and stearin to biodiesel," Jozal said, adding it may also process jatropha, a shrub with oil-bearing fruits.<\/p>\n
In late March, the company said that it would build a second plant in Malaysia's Lumut. But Jozal said it was still evaluating the plan.<\/p>\n
Sinar Mas Group has joined several Indonesian companies that have announced plans to build biofuel plants, mostly palm-oil based biodiesel, including PT Asian AGri and PT Bakrie Sumatra Plantations , to tap global interest in biofuels.<\/p>\n
In January, the group's palm oil unit, PT Smart, signed an agreement with Chinese oil major, CNOOC, and Hong Kong Energy Ltd. for a $5.5 billion investment to produce biofuel in
\nIndonesia.<\/p>",
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