Neste buys former biodiesel plant, targets renewable diesel growth

Pre-treatment and storage to start after maintenance work is completed during the second half of 2017.

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Updated on 28 Dec 2016 09:34 GMT

Neste has signed an agreement with Electrawinds ReFuel B.V. to acquire a former biodiesel plant in Sluiskil, Netherlands, located around 135 kilometres south of Rotterdam, near Terneuzen.

Neste says it intends to use the Sluiskil plant for the storage and pre-treatment of renewable raw materials for the company's renewable diesel refineries.

The transaction is expected to be completed in the first quarter of 2017. Neste has said that the purchase price will not be disclosed.

"By acquiring the Sluiskil plant, we enable expanding our raw material base further. Many new raw materials are wastes and residues that are difficult to process, and they require good pre-treatment before renewable diesel or aviation fuel can be produced from them. The pre-treatment capacity and storage tanks at Sluiskil also contribute to facilitating our future growth," commented Kaisa Hietala, Executive Vice President of Renewable Products at Neste.

Previously, conventional fatty acid methyl ester (FAME) biodiesel was produced at Sluiskil. The plant has not been in production since January 2015 and is due to enter into pre-treatment and storage use after maintenance work is completed during the second half of 2017.

Neste stressed on Wednesday that it aims to continue to focus on refining premium-quality renewable diesel which can be used in all diesel engines.

The company's recently rebranded Neste Renewable Diesel technology (previously called NEXBTL Renewable Diesel) enables the production of renewable diesel and other renewable products from nearly any waste fat or vegetable oil through a hydrogen-based treatment.

Neste Renewable Diesel is classified as a hydrotreated vegetable oil (HVO), and, according to Neste, can be blended in any combination with fossil diesel.

In June, Bunker Index reported that Neste had provided the Scripps Institute of Oceanography at the University of California with a a supply of NEXBTL Renewable Diesel during a year-long project that tested biofuel on the research vessel Robert Gordon Sproul.

In the EU, member countries have agreed that by 2020 at least 10 percent of all fuel must be from alternative fuels. In the Netherlands, biofuels are said to make up five percent of the total fuels market. The aim is to reach 10 percent in three years' time.

Each year, local fuel suppliers must report the quantities they have sold to the Dutch Emissions Authority (NEA). If they do not meet the minimum requirements, they are fined under the Renewable Energy (Transport) Order.