Guest contributor Mahardika Satria Hadi is the original author. This article is part of RIN Fellow Erwan Hermawan's project.
WILMAR Group has been the largest B30 biodiesel subsidy recipient since the Oil Palm Plantation Fund Management Agency (BPDPKS) was established in 2015. Through four subsidiaries—Wilmar Bioenergi Indonesia, Wilmar Nabati Indonesia, Multi Nabati Sulawesi, and Energi Unggul Persada—which produce 9.75 million kiloliters of FAME—or fatty acid methyl ester—a diesel ingredient, the business group founded by Martua Sitorus has received Rp39.52 trillion.
Subsidy for the oil palm company is determined by the BPDPKS steering committee based on the conversion factors for vegetable oil fuel’s market index prices, which fluctuate every month. Conversion factors are discussed with representatives of the industry and an association of oil palm farmers. Master Parulian Tumanggor admits to frequently attending steering committee meetings. Despite being Wilmar Nabati’s President Commissioner, Tumanggor joined these meetings as General Chairman of the Indonesian Biodiesel Producers Association (Aprobi).
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The former regent of Dairi, North Sumatra, in 1999-2009, and ex-echelon II official at the state-owned enterprises ministry has been attending these meetings since the BPDPKS steering committee was led by Coordinating Minister for the Economy Sofyan Djalil and now, when it is led by current Coordinating Minister for the Economy Airlangga Hartarto. As Aprobi Chairman, Tumanggor also recommended raising B30 biodiesel (30-percent FAME and 70-percent diesel fuel) to B40 in order to absorb as much as 12 million kiloliters of palm oil.
On April 5 and 6, Tumanggor told Tempo that he did not control biofuel subsidies to allow his company to receive the largest subsidy portion. On April 7, Wilmar Group Head of Energy Business Teo Sian Uh gave additional explanations.
Is it true that you have always joined BPDPKS steering committee meetings to determine biodiesel subsidies?
I have never joined the steering committee or any BPDPKS meetings. Pak Martias (Fangiono, owner of oil palm company Surya Dumai Group and founder of First Resources) and Pak Franky Widjaya (Sinar Mas Agro Resources & Technology President Commissioner) are the ones who have always been active in BPDPKS steering committee meetings.
Who has been representing Wilmar? Didn’t Martua Sitorus help determine the market index prices for biodiesel in steering committee meetings?
In regard to biodiesel’s market index price, as far as I know, the steering committee took no part at all. The market index price is the affair of the director-general of new and renewable energy and energy conservation as well as the Research and Development Center for Oil and Gas (Lemigas), sometimes involving the Bandung Institute of Technology and the ministry of research and technology.
The coordinating minister for the economy appointed Martua Sitorus as the primary resource person for the steering committee.
Teo Sian Uh: Pak Martua Sitorus has not been with Wilmar since July 15, 2018. At this time, Wilmar has no representative on the BPDPKS steering committee.
Do you represent Wilmar in meetings?
As Aprobi General Chairman, I have always attended meetings to discuss biodiesel since Pak Sofyan Djalil was coordinating minister of the economy, and then during Pak Darmin’s (Nasution) time, and now Pak Airlangga (Hartarto).
Are you close to them?
Well, we’re somewhat acquainted. In relation to biodiesel, because I’m Aprobi General Chairman. So, when I’m invited to a meeting, I attend.
The fact is, the Wilmar Group has been receiving the greatest biodiesel subsidy portion compared to other companies since the BPDPKS was established.
It’s in line with the FAME volume delivered.
It’s not because businesses are the ones who determine the market index price’s conversion factor?
The price of biodiesel is fully under the energy and mineral resources ministry.
Why did Wilmar Nabati sell FAME to Wilmar Bioenergi in 2020 before it was sold to Pertamina? What was the purpose of selling to another subsidiary?
I don’t know. What’s calculated is what is paid, how much FAME is sold to oil companies.