Securing Energy Supply: PGN Integrates Biomethane into Gas Infrastructure
The development of biomethane, utilising palm oil mill waste in South Sumatra, is nearing its final stages. PT Perusahaan Gas Negara (Persero) Tbk (PGN) is collaborating with Toyota Tsusho Indonesia (TTI) and PT KIS Biofuels Indonesia (KIS) to optimise the use of biomethane to ensure the availability of future domestic energy supplies.
PGN attended the groundbreaking ceremony for the biomethane plant developed by TTI and KIS on Monday (5/10/2026). This facility utilises organic palm oil waste and is targeted to produce approximately 150,000 MMBTU of biomethane per year.
This initiative is the first of its kind in Indonesia to produce biomethane in Sumatra, a region with a high density of palm oil mills. The project is an implementation of the Memorandum of Understanding (MoU) regarding biomethane development in Indonesia signed between PGN and TTI in 2022.
Under this partnership, PGN serves as the primary offtaker and transporter. The biomethane produced by PT KIS Toyota Tsusho Biomethane Indonesia (KTBI)—a joint venture between KIS and TTI—will be distributed to Toyota Motor Manufacturing Indonesia (TMMIN) and other industries through PGN’s existing pipeline network.
“We appreciate TTI and KIS for commencing the construction of this biomethane facility. For PGN, this is a significant step towards bringing renewable gas from domestic sources into the national energy supply chain. PGN is ready to support this through our infrastructure and commercial capabilities so that biomethane can be utilised by the industrial sector,” said PGN Corporate Secretary Fajriyah Usman, as quoted from a written statement on Tuesday (6/10/2026).
The use of biomethane utilises existing natural gas infrastructure, allowing customers to transition to biomethane with minimal infrastructure modification.
Beyond enhancing domestic energy security, the use of biomethane complements the increasing use of natural gas as decarbonisation efforts expand within the industrial sector.
Utilising Palm Oil Mill Effluent (POME) as feedstock for biomethane provides significant environmental benefits. Methane that would previously have been released into the atmosphere can be captured and processed into energy, supporting the reduction of greenhouse gas emissions and the achievement of NDC and Net Zero Emission 2060 targets.
It was further emphasised that this project strengthens the downstreaming of the palm oil sector by converting waste into economically valuable energy. According to Usman, biomethane plays a strategic role in supporting energy self-sufficiency and industrial decarbonisation.
“Once this biomethane production begins, industries such as TMMIN will have access to low-carbon energy, supporting competitiveness amidst global green supply chain demands. We hope this collaborative model can be replicated in other palm oil-producing regions,” she added.
“PGN will continue to strengthen collaborations with various partners to develop low-carbon businesses, including biomethane, as part of the company’s commitment to supporting national energy security and the energy transition,” she concluded.