Abstract: Transesterification of methyl ester is a reversible reaction and requires excess methanol to drive the reaction forward. In this study, Polyethylene Glycol (PEG) membrane reactor was used to separate glycerol during reaction, to attain high conversion of palm oil at lower methanol to oil ratio. Thus reduces the amount of methanol used. The transesterification of palm oil was performed using base catalyst. Experiments were performed in the membrane reactor in batch mode at different catalyst concentrations and different molar ratio (methanol/oil). Asymmetric polyethersulfone ultrafiltration flat sheet membranes with Polyethylene Glycol (PEG) of different molecular weight as additive were prepared by phase inversion process from casting solution containing Polyethersulfone (PES) as polymer, N,N-porylydone (NMP) as solvent and PEG of different molecular weights namely PEG 200, PEG 300 and PEG 400 as additives. The results show that PES with different PEG as additive are suitable for separation of glycerol during the reaction.