Dharma Satya Nusantara To Supply Palm Kernel Shell ForErex’s Biomass-Based Power Plant

A subsidiary of PT Dharma Satya Nusantara Tbk (“DSNG”, “the Company”), PT Dharma SumberEnergi (“DSE”) entered into an agreement with eREX Singapore Pte.Ltd., to supply Palm Kernel Shells (“PKS”) to Japan market for a period of 15 years. PKS nowadays has become an important source of feedstock for biomass-based power plants.

eREX Singapore PTE Ltd. is a subsidiary of eREX Co. Ltd, a publicly-listed and leading corporation in Japan with extensive experience in developing biomass-based power plants. The signing ceremony between the two companies was virtually conducted on 8 October 2020 by Mr. Efendi Sulisetyo as the President Director of DSE and Mr Shuji Yoda as the Managing Director of eRex Singapore Pte. Ltd.

The Company’s President Director, Mr. AndriantoOetomo, stated that the supply of palm kernel shells totaling to 70,000 tons per annum would be coming from the palm oil mills of the Company located in MuaraWahau, East Kalimantan.

“To date, palm kernel shells from processing Fresh Fruit Bunches into CPO are still utilized as the feedstock for generating energy at our palm oil mill’s boilers. However, this long-term supply agreement with eREX broadens our opportunity to export the PKS to Japan as the feedstock for eREX’s biomass-based power plants,” said AndriantoOetomo in the Company’s statement.

The partnership with eREX was a strategic move for the Company to implement its sustainability policy by utilizing the waste from the CPO production process and turning it into an economic valuable product in accordance with the principles of Environment, Social and Governance (ESG), added Andrianto.

Previously, in September 2020, the Company commissioned its first Bio-CNG Plant, which processes palm oil mill effluent (POME) into renewable energy in the form of electricity with a capacity of 1.2 megawatts and Bio-CNG contained in gas cylinders with a capacity of 280 m3 per hour.

“We are determined to integrate ESG into our business and look at it as a way of doing business. All production processes in both palm oil and wood products segments must implement sustainability frameworks so our products are in accordance with good business practices and certified to international standards. Furthermore, waste should also be exploited to generate both economic and environmental benefits,“ he said.

Meanwhile, Mr.HitoshiHonna,President of ErexCo.Ltd,stated “I am very pleased to have found great partner,DSN, to develop business together with this contract as a start. “,andeREX Co. Ltd, said in a statement, “by establishing a joint stockpile operation with DSN (who owns the mills), we can further secure long-term and economical PKS. In addition, the PKS produced from DSN’s mills are fully equipped with  RSPO certification approved by the Ministry of Economy, Trade and Industry (Japan), and it is possible to procure and supply sustainable PKS that maintains consistent certification.”

Previously, Empty Fruit Bunch (EFB), another type of palm oil mill waste, are only applied to the field as organic fertilizer.  But Now, the Company can also utilize EFB as biomass fuels for boilers at palm oil mills.

“By utilizing EFB for biomass fuel, we can reduce the methane emissions from the decomposition of oil palm EFB throughout the plantation area and then freeing up the usage of palm kernel shell for export to eREX, Japan as environmental-friendly biomass feedstocks,“ said Andrianto.

In the future, the Company will integrate its Bio-CNG plants with the biomass project to further reduce the usage of fossil fuels at palm oil mills, kernel crushing plant, transportation fleet as well as housing facilities throughout the plantation area to create further cost efficiency while reducing greenhouse gas emissions.

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