Komatsu, Adaro, UT sign biodiesel fuel project deal

Japanese firm Komatsu Ltd. signed on Thursday a basic agreement with IDX-listed energy firm PT Adaro Energy Tbk and IDX-listed heavy equipment distributor and coal miner PT United Tractors Tbk (UT) to jointly develop a bio-diesel fuel (BDF) pilot project at Adaro?s coal mine in South Kalimantan.

By March 31, 2010, the plant is expected to start producing BDF out of jatropha and other feedstock plants and operate Komatsu mining dump trucks fueled by the BDF, UT said in a statement.

The project aims to ultimately achieve a sustainable environmentally friendly operation in the mines of PT Adaro Indonesia, Adaro?s wholly owned subsidiary.

Komatsu will establish a BDF plant with a production capacity of 1 to 2 tons/day and a laboratory to ensure quality of the produced BDF on the Adaro coal mine. As a manufacturer, Komatsu will also render the standard warranty to Komatsu Dump Trucks fueled by the BDF produced from the project, it said.

Adaro will plant Jatropha and other feedstock plants on its reclamation areas and produce BDF from their seeds or fruits to be used by the Komatsu Dump Trucks operating at the Adaro coal mine.

UT, as the Komatsu distributor in Indonesia, will provide product support for the Komatsu Dump Trucks fueled by the BDF.

The target of the project is to operate 100 units of Komatsu dump trucks in and after 2012, using fuel with a BDF blend of 20%. If the target is realized, approximately 8,000 tons of BDF will be used annually and contribute to the reduction of approximately 20,000 tons of CO2 emissions which are roughly equivalent to 10% of CO2 emissions generated by Komatsu manufacturing plants in Japan.

In the event that emission credit will be issued from the project, Komatsu will be entitled to such credit under the basic agreement. (denny)