Techno-Economic Analysis for Small Scale Production of Rubber Seed Oil and Biodiesel in Palangkaraya, Indonesia

Abstract

Estimation of production cost and sensitivity analysis for small scale production of rubber seed oil and biodiesel was studied. The production unit is projected to be built in the ex-Mega Rice Project area south of Palangkaraya, Indonesia which has a serious land degradation and deforestation problem. The valorization of rubber seed to produce bioproducts is seen as a contribution to revitalize the area. The production cost for rubber seed oil and rubber seed biodiesel in a small-scale (55 ton/y) was estimated to be 0.42/L and 1.00/L, respectively. This value is comparable with the price of diesel in remote areas in the ex-Mega Rice Project area close to Palangkaraya (up to 1.25/L). The effects of capital investment, production capacity, price of co-product credit, employees' salary and price of raw materials towards the production cost of rubber seed oil and biodiesel were investigated in the sensitivity analysis. The cost of capital investment has a relatively minor impact on the production cost of the rubber seed oil and biodiesel. The production capacity has a very strong influence in the production cost of rubber seed oil. The effect of other input variables is significant and all are showing about equal sensitivity.