Jakarta. Lion Air Group, Indonesia's largest budget airline operator, signed a memorandum of understanding with the Indonesian Palm Oil Association, or Gapki, on Tuesday (10/04) in Jakarta to conduct research, development and trials to explore alternative palm oil-mixed aviation fuel, known as bioavtur.
The use of bioavtur, an aviation fuel that harnesses vegetable oil extracted from crude palm oil (CPO), is aimed at improving farmers' productivity and welfare through sustainable environmental practices and to reduce the country's dependency on fossil fuels.
"This commitment will accelerate our efforts to reduce our dependency on fossil fuels for our aircraft," Lion Air founder Rusdi Kirana said in a statement on Tuesday.
Lion Air Group has a total fleet of 118 aircraft, and it has ordered about 700 new aircraft by 2025.
"It will also increase the consumption of domestic-produced palm oil," he said.
The Indonesian government is trying to gradually minimize its dependency on fossil fuels by setting a target to mix aviation fuel with 3 percent biofuel by 2018. It is also expected to reach about a 5 percent mix by 2025.
The government subsidizes the use of B20 -- a mixed fuel with 20 percent biodiesel content -- by power producers and by retail customers.
Rusdi, who currently serves as the Indonesian ambassador to Malaysia, said the use of palm oil-based fuel will boost the country's economy and improve farmers' welfare.
According to Gapki data, as the world's largest palm oil producer, Indonesia has about 50 million people who depend on palm oil and its derivatives.
The signing was conducted by Gapki chairman Joko Supriyono and Lion Air president director Edward Sirait.