Jakarta: Singapore-based clean technology firm CRecTech Pte. Ltd. has signed an initial agreement with Pertamina New & Renewable Energy to explore a pilot project that would convert biogas into biomethanol in North Sumatra, Indonesia Business Post reported.
The two companies signed a memorandum of understanding on April 1 to study the feasibility of setting up the project in the Sei Mangkei Special Economic Zone. The agreement is at a preliminary stage and does not yet include any firm investment commitment.
As part of the arrangement, both sides will conduct a detailed study to assess whether the project is technically and financially viable. The evaluation will focus on whether Indonesia’s biogas resources, particularly those derived from palm oil waste, can support a commercially sustainable biomethanol facility.
If found viable, the project could involve deploying CRecTech’s proprietary technology at the Sei Mangkei biogas power plant. However, details such as project size, investment and timelines have not yet been finalised.
Indonesia is considered to have significant potential for biogas production, especially from palm oil mill waste, though its use remains limited due to infrastructure gaps, funding challenges and policy uncertainties.
Pertamina NRE Chief Executive Officer John Anis said the initiative is part of efforts to better utilise domestic resources. He noted that the country has strong potential in both demand and raw material availability, particularly from underutilised palm oil waste.
The proposed project is also being seen as part of wider efforts to expand cleaner fuel options, including for sectors such as shipping where reducing emissions remains a challenge. Biomethanol is being explored as an alternative fuel, though its viability will depend on costs and scale.
Sei Mangkei has been identified as a potential site due to the availability of feedstock, but the final decision will depend on the outcome of the ongoing feasibility study.
