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Preem and Setra to collaborate on renewable fuel production

Swedish oil refiner Preem and compatriot wood products major Setra Group are investigating the possibility of building a joint production facility for the manufacture of pyrolysis oil, a renewable raw material for biofuel. The facility is being planned at Setra Kastet sawmill in Gävle and is expected to be completed in 2021.

Petter Holland, CEO, Preem and Hannele Arvonen, CEO, Setra Group have agreed to collaborate on the pyrolysis oil production facility being planned at Setra’s Kastet sawmill in Gävle, Sweden (photo Sten Jansin).

The planned production facility will turn sawdust into pyrolysis oil, a renewable raw material for biofuel. Construction is expected to begin in 2019, and the facility is estimated to provide around 25 000 tonnes of pyrolysis oil annually that, via Preem’s refinery in Lysekil, will be refined into biofuel. An application for an environmental permit for the pyrolysis plant has been submitted.

This is Europe’s first production facility for pyrolysis oil linked to a refinery. To meet Sweden’s national target of 70 percent fewer carbon emissions in the transport sector by 2030, a number of measures are required. This is why we were immediately interested when Setra got in touch with their plans for a pyrolysis oil manufacturing facility. It’s important to invest in different biofuels, with sawdust being one possibility, said Sören Eriksson, Development Engineer at Preem.

The partnership with Setra is part of Preem’s overall ambition to manufacture 3 million m3 of renewable fuel annually at its refineries in Lysekil and Gothenburg by 2030.

Sawdust is a by-product in our manufacture of wood products, and the possibility of producing pyrolysis oil, which can then be used in biofuel, is completely in line with Setra’s strategy to increase the value and climate benefit of our products. We’ve been running the pyrolysis oil manufacturing project with the aim of finding a partner for commercial applications. The fact that Preem now wishes to invest in this facility with us is extremely positive, said Hannele Arvonen, CEO of Setra Group.

In 2017 a total of around 9 million m3 of transportation fuels were sold in Sweden, of which just over 1.9 million m3 was classed as a biofuel, according to the Swedish Petroleum and Biofuel Institute (SPBI). Around 15 percent of all biofuel was produced in Sweden, with the rest being imported from other countries.

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