Shell will build a biorefinery with production capacity of 820,000 t/yr in Rotterdam, the Netherlands, it said today. The facility will be on the Pernis refinery site and production is expected to start in 2024.
Shell will produce sustainable aviation fuel (SAF) and hydrotreated vegetable oil (HVO) — also known as renewable diesel — from used cooking oil (UCO), waste animal fat (tallow) and "other industrial and agricultural residual products," it said. Of the 820,000 t/yr capacity, SAF could make up more than half, with HVO taking the remainder of the share. Shell will "adjust this mix to meet customer demand," it said.
Shell plans to supplement the waste feedstocks with a range of vegetable oils until sustainable advanced feedstocks, categorised under the EU's Renewable Energy Directive (RED) II Annex IX Part A, become more widely available. The plant will not process any virgin palm oil as feedstock.
"The main start-up feedstocks will be rapeseed and sunflower oil, but Shell may use soy oil initially as part of the start-up of the facility. Shell requires that 100pc of its South American soy oil be certified as sustainable. If we are unable to purchase certified material, we purchase RTRS offset credits from the Roundtable on Responsible Soy Association to cover the balance," Shell told Argus today.
Shell did not comment on potential feedstocks volumes required, but the decision has been made during a period of rapidly increasing demand for biofuels feedstocks. Demand from the food and fuel sectors has pressured the vegetable oils complex, while supply has been constrained by slow or delayed harvests in some regions and lower crop yields caused by weather extremes in others.
Global UCO supply has been constricted by restaurant closures over the past 18 months, owing to Covid-19 restrictions, and key biofuels feedstocks rapeseed oil, soybean oil and UCO have all reached record high price levels in the second half of this year.
Shell expects to use carbon capture technology at the plant, and to store the CO2 in an empty North Sea gas field under the Porthos project. A final investment decision is expected on Porthos in 2022.
The plant will help Shell meet its target of becoming a net-zero emissions energy business by 2050. It said in June that it plans to accelerate its energy transition strategy and is likely to take "some bold but measured steps over the coming years" after a Dutch court ruled in May that the company must sharply reduce its CO2 emissions this decade.
