Indonesia's Molindo to start work on second ethanol plant in 2012

Indonesia's Molindo Raya Industrial is planning to start work on a 55 million liter/year (14.53 million gallon/year) ethanol plant in 2012, following the recent acquisition of land for the project, a company source said last week.

When completed in 2013, the $40 million-50 million plant will double the company's ethanol production capacity. Molasses feedstock for the plant will sourced from a nearby sugar mill, the source said.

The company currently owns a 55 million liter/year molasses-based ethanol plant at Lawang, East Java. About 18% or 10 million liters/year of production from the plant is anhydrous or fuel-grade ethanol, while the rest is hydrous ethanol used for industrial or pharmaceutical purposes.

Molindo exports around 15 million-18 million liters/year, or 25% of its ethanol production. The split between hydrous and anhydrous ethanol depends on market demand, the source said.

Molindo is the largest ethanol producer in Indonesia, with a 90% share of the domestic market. It launched production of anhydrous ethanol in 2004.

source: platts