SINGAPORE, Dec 22 (Reuters) – Indonesia is back on track to
allocate 9.2 million kilolitres of unblended biodiesel to
companies next year as originally planned, the energy ministry
said on Tuesday.
The announcement comes a week after an official from the
National Energy Council said the country may have to lower its
biodiesel – palm oil biofuel – allocation next year to 8.5
million kilolitres due to an uncertain fuel consumption outlook
due to the COVID-19 pandemic.
The Indonesian government requires its diesel to be blended
with 30% biocontent made out of palm oil, aiming to be less
dependent on fuel imports and sop up palm supply. It sets output
targets, subsidises the price difference between palm and crude
oil and allocates the product to 20 biofuel companies.
However a slump in fuel prices this year has made the
programme less economical, and plans to increase the biocontent
to 40% have been delayed due to funding issues.
Indonesia is expected to distribute only 8.5 million
kilolitres of biodiesel this year, compared with the 9.6 million
originally planned, according to the government.
(Reporting by Fathin Ungku and Bernadette Christina Munthe;
Editing by Pravin Char)
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