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Korean Companies Eye Indonesia’s Biomass Potential
Date: August 26, 2013 Indonesia’s forests look set to come under more pressure as South Korean companies look to develop a new biomass industry. Korean firm, Depian, plans to invest USD20 million to build the infrastructure for a wood pellet business in Pelaihari, South Kalimantan. In a deal with local investor PT Inhutani III, Depian will hold 49 percent of the joint venture called PT SL Agri, which will produce 30,000 tons of wood pellets a year up until 2016 when the plant will upgrade and produce 100,000 tons. The original deal was signed in January, but more details were revealed last week by SL Agri president Muhammad Akbariah. Speaking to the Jakarta Post, he said building will start in October and the plant should be operating by March 2014. “The project is worth USD20 billion in total, with USD15 billion for the development of the plant and the remaining USD5 billion for planting trees on approximately 5,000 hectares to 8,000 hectares of an industrial forest that PT Inhutani III is currently preparing,” he said after a meeting with Depian representatives and South Korean Embassy officials. The South Koreans plan to export the wood pellets home to help boost the national renewable energy targets of 20 percent by 2020, up from under one percent in 2011. There are indications that the Depian deal might be the first of several. Officials from the Korean embassy said it could serve as a “pilot project” for co-operation on other alternative energy products in Indonesia. Lee Mira, an embassy counselor focused on forestry, agriculture, fishery and climate change said 13 other South Korean firms were looking at other projects and that biomass energy was a priority. However she hinted that South Korean companies found it difficult to find partners in Indonesia. Continue reading
