Preem and Vattenfall sign LoI to explore green hydrogen production
Preem and Vattenfall sign Letter of Intent (LoI) to explore the opportunities for using "climate-smart" hydrogen in the refinery scale production of biofuels for the Swedish market.
Sweden’s largest transportation fuel producer Preem and Swedish state-owned energy utility major Vattenfall have announced that they have signed a Letter of Intent (LoI) to explore the opportunities for using “climate-smart” hydrogen in the refinery scale production of biofuels for the Swedish market. Preem and Vattenfall will establish a working group and jointly fund a feasibility study.
Operating two oil refineries in Sweden, Preem has a goal to produce 3 million m3 renewable transportation fuels by 2030, which would account for the bulk of the reduction of carbon emissions in the Swedish transport sector. However, to achieve this requires more green feedstock. Vattenfall, which aims to enable climate-smart solutions, can contribute with “climate-smart” production of hydrogen.
– We need to use many different types of raw materials and produce several different types of fuels to replace fossil fuels with renewable sources. We also need many different solutions. Preem’s contribution is to make as green and efficient fuels as possible. The cooperation is also a step in our vision to be the leader for the transition towards a sustainable society, said Petter Holland, President and CEO of Preem in a statement.
Preem and Vattenfall will also look into the possibility of producing green hydrogen by using electricity from hydro and wind power, which would have very low greenhouse gas (GHG) emissions.
– We are taking an important step and I look forward to the possibility of cooperation. I see both the opportunity and the climate benefits where Vattenfall can contribute to climate and competitive hydrogen, says Magnus Hall, President and CEO of Vattenfall.
Preem currently produces biofuels, a renewable diesel using tall oil, a by-product from the forest industry, but intends to come produce renewable fuels from sawdust and forest residues from timber harvesting and lignin from pulp industry.
Hydrogen is an essential part of the process to convert renewable raw materials into biofuels. Climate-smart hydrogen along with various by-products from pulp mills would increase production of biofuels several times compared with current levels.