Palm oil mill effluent collected from Indonesian plantations on the island of Sumatra and in Kalimantan will be fermented and refined to produce biomethane. Production is expected to begin in 2025 at an annual 10,000 tons, with plans to boost it to 100,000 tons by 2030.

JGC, Pertamina, Osaka Gas, and Japanese oil and gas explorer Inpex agreed Monday to jointly study the project’s feasibility.

Biomethane from Sumatra will be transported to the island of Java, Indonesia’s economic centre, via Pertamina pipelines and sold to customers, starting with Japanese companies operating there. Exports to Japan will be considered going forward.

Wastewater from palm oil mills in Indonesia, one of the world’s biggest producers of palm oil, is often temporarily stored in outdoor lagoons.

There, it ferments and generates methane — a powerful greenhouse gas. The proposed project will not only serve as a source of renewable energy, but also help reduce the immediate release of methane into the atmosphere.