Malaysia To Soon Present Cabinet Note On B10, B7 Biodiesel Programs-Minister Kok

© Nikkei Markets

KUALA LUMPU (Nov 08) — Malaysia plans to soon present a cabinet note that proposes implementation of B10 and B7 biodiesel programs, the minister for primary industries said Thursday. 

“I’ll present a cabinet paper on the implementation of biodiesel B10 for the transport sector and B7 for the industrial sector soon,” Teresa Kok said at a news conference in Purtrajaya. 

The comments follow last week’s budget announcement that proposed implementation of the B10 and B7 biodiesel programs from the next year. 

The biodiesel program, which aims to blend 10% of palm-based methyl ester with 90% traditional petroleum diesel for sale at retail pumps nationwide, was initially designed in 2013 in-part to cut the Southeast Asian country’s swelling palm oil inventory that weighed on prices of the commodity.

However, the program was deferred multiple times due to concerns over potential damage to vehicle’s engine that may prompt manufacturers to dishonor their warranty pledges. A steep decline crude oil prices in 2014-15 also dimmed appeal of the mixed-fuel program.

Meanwhile, Malaysia and Indonesia, the world’s two top producers of palm oil, will jointly combat anti-pam oil campaigns, Kok said.

Kok said Malaysia and Indonesia reject the EU’s Renewable Energy Directive II, which discriminate against palm oil, and the countries will jointly seek new markets for the commodity that is used in everything from ice creams to lipsticks. 

E.U. lawmakers have approved draft measures to reform the local power market that seek to lower energy consumption to meet broader climate goals. The plan includes a ban on the use of palm oil in motor fuels from 2021.

The EU move comes despite heavy protests from Malaysia and Indonesia which together account for more than 80% of global palm oil output.

“We’re very unhappy with EU. We’re doing our very best. We feel that our efforts are not being appreciated,” Kok added. 

– By Gan Pei Ling
– Edited By Abhrajit Gangopadhyay

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