SCA and St1 ally to produce and develop liquid biofuels
Both companies will be equal partners in the joint venture to inaugurate the new St1 Gothenburg Biorefinery by 2023.
SCA, Europe’s largest private forest holding, and St1, the Nordic energy group, have announced a joint venture to produce and sell liquid biofuels. The two companies will merge to launch a new biorefinery with a total capacity of 200,000 tonnes of liquid biofuel by 2023. With a total investment cost of SEK 2.5 billion (approximately USD 293 million), the two companies will be equal partners in project.
“The partnership with SCA is a key factor in the implementation of our investment program for renewable fuels and it secures the supply of renewable raw materials to meet the ambitious Nordic climate goals for 2030,” says Henrikki Talvitie, CEO of St1 Nordic Oy.
The companies’ joint venture will have a 50% share in St1 Gothenburg’s biorefinery, an installation where the new facility is under construction. Its design will not only optimize the production of renewable HVO diesel and biojet fuel but also allow the use of tall oil-based raw material. It will also have access to SCA’s tall oil, a by-product of sulphate pulp production from the Group’s mills in Östrand, Obbola and Munksund, and it is expected to be fully operational during the second quarter of 2023.
“In line with our communicated long-term strategy, we will now, with the joint venture with St1, go from being a supplier of tall oil to the chemical and fuel industry to becoming active in further processing of our renewable raw materials,” commented Ulf Larsson, President and CEO of SCA .
St1 will also be a 50% owner of SCA Östrand Biorefinery, as part of the negotiation. The site has recently received an environmental permit to produce 300,000 tonnes of liquid biofuels based on black liquor and solid biomass. The project still has a long way to go, but with the recently completed association, it will undoubtedly begin to solve its technical challenges in order to be completed.