Toyota Tsusho Corporation has established PT KIS Toyota Tsusho Biomethane Indonesia (KTBI), a joint venture with PT KIS Biofuels Indonesia (KBI), to develop a biomethane production and sales business in Indonesia. The joint venture was established in September 2026, with commercial operations targeted to begin in 2027.
The initiative aims to tap Indonesia’s abundant biomass resources, particularly palm oil mill effluent (POME), while supporting the country’s growing demand for lower-carbon energy sources.
Indonesia is one of the world’s leading natural gas producers and exporters. However, declining domestic gas production alongside rising demand has increased the importance of securing a stable energy supply. At the same time, Indonesia is the world’s largest palm oil producer, generating significant volumes of biomass resources such as POME.
Against this backdrop, KTBI plans to produce high-purity biomethane by upgrading biogas generated from POME at a palm oil mill in South Sumatra Province. The biomethane will then be transported and supplied to customers, including manufacturers in West Java Province.
The project plans to utilise the existing pipeline network operated by PT Perusahaan Gas Negara (Persero) Tbk (PGN), Indonesia’s state-owned gas company. Annual biomethane sales of approximately 150,000 MMBTU are targeted.
The project is expected to contribute to greenhouse gas emissions reduction through two routes: preventing methane generated from POME from being released into the atmosphere and replacing conventional fossil-based fuels with biomethane.
By using existing gas pipelines and customer-side gas-consuming equipment, the project is expected to allow industrial customers to pursue decarbonisation without requiring significant additional capital expenditure.
KTBI also plans to obtain International Sustainability and Carbon Certification (ISCC) for the project. The certification is expected to help quantify the environmental attributes of the biomethane and improve their potential market value.
KBI, Toyota Tsusho’s partner in the venture, is the Indonesian subsidiary of KIS Group, which develops biogas and biomethane projects internationally. According to Toyota Tsusho, the KIS Group has undertaken more than 90 biogas projects across more than 20 countries and has experience in launching Indonesia’s first commercial biomethane production and sales operation.
The project follows a memorandum of understanding signed between Toyota Tsusho and PGN in 2023 for the commercialisation of biomethane. The planned development will also mark the first project in Indonesia to supply biomethane produced in Sumatra, where the palm oil industry is concentrated, to customers in Java, one of the country’s major manufacturing and industrial hubs.
Toyota Tsusho will combine KBI’s biomethane expertise with its business platform and customer network in Indonesia, particularly across the manufacturing sector. The company aims to support the decarbonisation requirements of industrial customers, including Japanese companies operating in Indonesia, while contributing to the wider adoption of biomethane and the development of a more sustainable energy system.
The planned annual sales volume of 150,000 MMBTU represents a significant step in Toyota Tsusho’s efforts to develop Indonesia’s biomethane market and establish cross-regional renewable gas supply infrastructure.
