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New bioethanol plant to break ground in Indonesia

Plantation company PT Perkebunan Nusantara (PTPN) is to construct a bioethanol plant in Mojokerto, Indonesia.

The company claims the plant will be the first ever bioethanol plant to be operated by a state-owned company and aims to produce up to 30 million litres of fuel a year.

PTPN finance director Dolly Bulungan says the project will abosrb around $48 million (€39 million) split between a $28 million loan from Bank Mandiri, a $16 million grant from Japan’s New Energy and Industrial Technology Development Organisation and $4 million of available internal cash.

The plant will be located on an eight hectare area and surrounded by the PTPN’s sugar plantation, which produces up to 250,000 tons of molasses annually.

It is predicted the project will commence commercial production by March 2013.