CNOOC, Sinar Mas sign US$5.5b agreement to develop biofuel
Tuesday, January 9 2007 - 03:29 AM WIB
SMART, which is listed on the Jakarta Stock Exchange, is a subsidiary of Indonesian conglomerate Sinar Mas Group, while Hong Kong Energy is a business group involved in property, infrastructure, alternative energy in China.
The agreement was signed at the Ministry of Energy and Mineral Resources by CNOOC vice president Wu Zhengfang, SMART chairman Franky Oesman Widjaya and honorary chairman of Hong Kong Energy Wang Jun.
The agreement was among dozens of agreements worth more than $10 billion signed on Tuesday by dozens of companies, including Indonesian banks, to support the government?s program of developing bioenergy in the country. The program aims to lessen the country?s dependence on fossil fuel.
SMART and its partners will develop biodiesel from crude palm oil and bioethanol from sugarcane and cassava.
Franky said the project will be developed in Papua and Kalimantan where the local administrations had prepared land totaling 1 million hectares.
The joint venture will invest $5.5 billion for the projects in three phases over eight years.
Also during the event, SMART signed financing agreements with state owned banks Bank Mandiri and BNI.
In order to develop jatropha curcas as a source of biofuel, Sinarmas through Eka Tjipta Foundation in cooperation with the Bogor Institute of Agriculture the Center of Plantation Research and Development at the Ministry of Agriculture will establish Deltamas Jatropha Nursery & Research Center over 500 hectares of land in Deltamas, Kerawang, West Java.
Other companies that signed agreements are PT Medco Etanol Indonesia, a subsidiary of national energy firm PT Medco Energi International, which signed an agreement with state owned plantation firm PT PN VIII to develop cassava-based bioethanol project Garut and Cianjur, West Java.
Coal mining firm PT Berau Coal signed agreements with Berau regency administration and the Ministry of Agriculture?s Center of Plantation Research and Development to develop jatropha curcas projects. (Godang)