Indonesia is engaged in talks with Toyota Motor Asia on a possible joint investment to produce bioethanol inside the country, government and corporate officials said on Monday. The deliberations, which involve a renewable energy unit of state-owned Pertamina and Toyota Tsusho, focus on a proposed plant sited in Lampung province at the southern tip of Sumatra.
Deputy Investment Minister Todotua Pasaribu outlined details of the proposal, saying the facility, if agreed, would be designed to produce 60,000 kilolitres of bioethanol per year. Pasaribu said the partners could begin construction in the second half of 2026, with the first commercial output targeted for 2028, provided a deal is finalised.
The feedstock for the Lampung plant is planned to come from a new 6,000-hectare sorghum plantation that the project would develop. Pasaribu also put the estimated total investment cost in a range between $200 million and $300 million.
Japan's Research Association of Biomass Innovation for Next Generation Automobile Fuels, known as raBit, is participating in the discussions, Pasaribu added. Speaking alongside the minister, Masahiko Maeda, chief executive for Toyota Motor Asia in the region, confirmed that Toyota vehicles would be capable of using bioethanol produced at the Lampung site.
Pras Ganesh, an executive vice president of Toyota Motor Asia, told reporters on the sidelines of the press briefing that negotiations remain ongoing and that no final deal has been reached. The timetable for construction and production therefore remains conditional on reaching a formal agreement between the parties.
Indonesian authorities have set targets to expand domestic bioethanol output using local sources such as palm oil biomass, corn and sorghum, with the stated aim of reducing reliance on imported fuels. The government is planning to require a 10% bioethanol blend in gasoline by 2028 as part of that policy framework.
Contextual note - The discussion covers potential collaboration between a state-linked renewable arm of Pertamina, Toyota Tsusho and supporting Japanese industry bodies. The business case presented by officials includes dedicated feedstock acreage, an explicit production capacity, a construction start window and a projected investment range. All timelines and expenditures remain contingent on final agreement.