Pertamina’s new fuel product contains a mixture of 5 percent bioethanol derived from molasses, a sugarcane waste product, and Pertamax, gasoline with a research octane number (RON) of 92.

The fuel would have RON of 95, Pertamina said, and the company decided to name the product Pertamax Green 95 – despite 95 percent of its mixture still coming from fossil fuel.

The public will need to pay around Rp 13,500 (90 US cents) a liter for the new fuel, slightly higher than its Pertamax predecessor at around Rp 12,400 a liter.

“Pertamina is open to the possibility of expanding the product to other areas, but we still need to examine the results of the market assessment made in the two regions,” Irto Ginting, corporate secretary of Pertamina’s commercial arm Pertamina Patra Niaga, told The Jakarta Post on Wednesday.

Pertamina’s new schedule is a slight setback from the company’s previous target to launch the product in June.

Read also: Pertamina to launch bioethanol gasoline this month, CEO says

Indonesia has been a net importer of oil and fuel for decades.

More than a third of the country’s fuel consumption is met with imports, according to the Energy and Mineral Resources Ministry data. 

Relying on imports has caused a strain on the government budget, as fuel subsidies swelled in 2022 amid the weakening rupiah against the United States dollar and high international oil prices, which combined with a massive shift of customers to subsidized fuel.

Prior to bioethanol, Pertamina has implemented the use of biodiesel using a mixture of 35 percent fatty acid methyl esters (FAME), a derivative product from crude palm oil (CPO), with its diesel fuel product Solar since February this year.

The government claimed Indonesia had become the world largest biodiesel producer thanks to the initiative and it has set to increase the mixture of FAME at 40 percent in its biodiesel products, following a successful test late last year.

Coordinating Economic Minister Airlangga Hartarto said in January that he expected Indonesia to save US$10.75 billion in foreign exchange from the implementation of the mandatory B35 program.

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Pertamina CEO Nicke Widyawati assured that the development of bioethanol would not disrupt food supplies needed by the general public as the fuel was developed from the waste generated from sugarcane processing to sugar.

“More importantly for Indonesia, it is an attempt to establish energy independence, as we will develop [fuel] that is based on the country's natural resources,” Nicke said on June 6.

However, experts have warned the development may face hurdles due to three factors, namely high sugarcane prices, fluctuations in the price of molasses and low production capacity of local sugarcane.

The government recently formed a task force designated to improve the country sugarcane production to the point it could achieve self-sufficiency in June.