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St1 and SCA form partnership to produce renewable fuels

Swedish forest industry major Svenska Cellulosa Aktiebolaget (SCA) has announced that it together with Finland-headed oil refiner and renewable fuel developer St1 Nordic Oy has formed a partnership to develop large-scale production of renewable fuels from tall oil. The planned production site will be St1's refinery in Gothenburg, Sweden.

SCA’s pulp mill in Östrand, Sweden, produces chemical-thermo-mechanical pulp (CTMP) and chlorine-free, bleached softwood kraft pulp (photo courtesy SCA).

SCA’s pulp mill in Östrand, Sweden, produces chemical-thermo-mechanical pulp (CTMP) and chlorine-free, bleached softwood kraft pulp (photo courtesy SCA).

According to SCA, the aim of the partnership is to construct a new facility to produce advanced renewable fuels from tall oil with a capacity of 100 000 tonnes per annum. Construction of the new facility, subject to permission process and final approval from both companies, is expected to cost around SEK 500 million (≈ EUR 48.65 million) to build and is planned to be operational in 2021.

When we start working on more refined energy products, a partnership with a company that knows the processes and the market is very valuable. St1 is a company with the ambition to work with us in the change towards renewable fuels, said Ulf Larsson, President and CEO of SCA.

Tall oil is a residual product from the production of kraft pulp in SCA’s mills Östrand, Obbola and Munksund. SCA is presently expanding its kraft pulp mill Östrand and as a result, the production of tall oil from the mill will increase by more than 100 percent.

Between the two partners, the parties constitute the full value-chain from the raw material to the refining process, distribution and sale of the renewable fuel to the customers.

Partnership with SCA is a key element in the implementation of our renewable fuels investment program and it secures supply of raw materials to meet the ambitious Nordic climate targets for 2030. SCA works with a number of interesting development projects in renewable energy, and we see interesting opportunities to further develop the cooperation says Mika Anttonen, Chairman of the Board of St1.

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