Petrobras to test HVO production

Brazil's state-controlled Petrobras will begin pilot production of hydrotreated vegetable oil (HVO) in July while awaiting a regulatory decision that could reshape the country's pioneering biodiesel industry.

HVO is produced by treating vegetable oil with hydrogen. Petrobras said it will utilize its patented HVO technology at its 208,000 b/d Repar refinery in Parana state.

Petrobras downstream director Anelise Lara said the economic viability of its renewable diesel technology will depend on hydrocarbon regulator ANP's recognition that it meets current biodiesel standards.

Brazil produces most of its biodiesel from soybeans.

Other HVO projects are also moving forward in the region. Last year, Brazilian biodiesel investor ECB Group announced an $800mn investment in HVO in neighboring Paraguay.

ECB, which is controlled by Brazilian businessman Erasmo Battistella, will develop a 16,500 b/d plant dubbed Omega Green to produce HVO. Battistella is co-owner with Petrobras of BSBios, one of Brazil's largest biodiesel producers.

The traditional biodiesel industry is also investing in expanding its capacity as the country's mandated biodiesel blend rises to 15pc by March 2023, from a current 12pc.

HVO has made significant inroads in the EU.

Spain produced 425,000t of domestic HVO in 2019, up from 375,000t in 2018, according to markets regulator CNMC. Repsol is proposing to build a 200,000-250,000 t/yr HVO plant at the Spanish port of Cartagena. The company is targeting HVO production of 600,000 t/yr in 2030.