Wilmar plans biodiesel plant in Indonesia by 2007

Wilmar Holdings Pte. Ltd. will build Indonesia's first biodiesel plant by 2007, though another plant planned in Singapore for this year has been put on hold, agency reported on Monday.

The US$20 million biodiesel plant in Riau, will have an annual capacity of 250,000 tons, with the potential for further expansion as the firm seeks to capitalise on demand for biofuels to cut costly oil imports and greenhouse gas emissions.

"Feedstock for this project is mainly palm oil," said a spokeswoman from Wilmar Holdings, a Singapore-based edible oil producer and refiner.

Wilmar's plant will be the first in Indonesia if it comes onstream ahead of a US$25 million joint venture between plantation company PT Bakrie Sumatera Plantation Tbk and construction firm PT Rekayasa Industri, scheduled for the middle of 2008 with an annual capacity of 60,000-100,000 tonnes.

Indonesia is the world's second-largest palm oil producer and plans to develop another 3.0 million hectares (7.4 million acres) of plantations in the next five years, partly to meet biofuel demand. (*)