Sinar Mas Cepsa inaugurated yesterday its first oleochemicals plant in Indonesia, which represents an investment of EUR300 million (USD356.7 million). The plant will produce fatty alcohols from sustainably sourced palm kernel oil, a key ingredient in the manufacture of everyday products such as household cleaning goods and personal care products.

Sinar Mas Cepsa is a wholly owned joint venture between Cepsa, a leading integrated energy company and world leader in the production of linear alkylbenzene (LAB) used to make biodegradable detergents, and Golden AgriResources (GAR), member of the Indonesian consortium of Sinar Mas businesses and the world’s second largest vertically integrated palm oil company.

The plant’s inauguration ceremony in Dumai, Sumatra was attended by officials and dignitaries from the Indonesian Ministry of Industry.

The Dumai plant has an annual production capacity of 160,000 metric tonnes of fatty alcohol per year. Sales of the vegetable-based alcohols will primarily focus on Asia. The plant will also service demand from Sinar Mas Cepsa’s surfactant plant in Germany, which serves markets in Eastern and Western Europe.

The global market for fatty alcohols is predicted to reach 4.1 million metric tonnes by 2025, demonstrating a five-year compound annual growth rate of 3.5%. The plant helps to consolidate Cepsa’s position in Asia following the inauguration of its Shanghai plant in 2015, which made it the world´s second largest producer of phenol.

GAR’s Lubuck Gaung refinery, certified by the Roundtable on Sustainable Palm Oil and located nearby, supplies the plant with sustainable, traceable palm kernel oil. The Dumai plant is also fully self-sufficient.