April 27, 2012 / 2:49 AM / in 7 years

Corrected: Indonesia says 25 miners agree to biodiesel requirement

JAKARTA (Reuters) - Twenty five Indonesian mining companies have so far agreed to comply with a government requirement to use biodiesel as fuel, the energy ministry said on Tuesday, in a bid to reduce pollution and increase the use of the renewable energy.

From July 1, biodiesel must account for least 2 percent of the total fuel consumed by mining companies in Indonesia, the world’s largest producer of biofuel raw material palm oil.

The companies that have agreed to comply include major coal miner PT Adaro Energy Tbk ADRO.JK and PT Berau Coal Energy Tbk BRAU.JK, the head of the biodiesel department, Maritje Hutapea, said.

Favorable export taxes for palm-based biofuel have spurred Indonesian firms to turn palm oil into the renewable fuel and corner the European market.

Indonesia exported half a million metric tons of palm methyl ester — or biodiesel — in the first half of 2011, compared to just 7,000 metric tons (7,716.2 tons) of tax-free exports by rival palm oil producer Malaysia, according to industry estimates.

This March 27 story has been corrected to clarify in paragraph 3 that the official was not being quoted from a statement and to delete quotes in paragraphs 4-5 because their accuracy could not be verified

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