In Spain, multinational oil and gas firm Compañía Española de Petróleos, S.A.U. (Cepsa), a Mubadala Group company, and Bio-Oils La Rábida, a vegetable oil processing and biodiesel production facility in Huelva belonging to Singapore-headed AAA Oils & Fats Pte Ltd (Apical Group), have announced the formation of a joint venture to promote the production of second-generation (2G) biofuels.
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The facility, first announced by Cepsa in March 2022 is to be located at Cepsa’s La Rábida Energy Park in Palos de la Frontera (Huelva), will entail an investment of up to EUR 1 billion, one of the largest private investments in the history of the southern Spanish region of Andalusia.
Secure access to feedstock
The new plant will secure the majority of the feedstock supply from organic waste such as agricultural residue or used cooking oils (UCO) through a global, long-term agreement with Apical, Bio-Oils’ parent company, enabling it to address one of the key challenges facing the industry – access to feedstock.
Apical Group is the world’s second-largest vegetable oil processor with a 14 percent global market share and a global palm oil refining capacity of 10.6 million tonnes (2022).
Its Bio-Oils La Rábida facility in Huelva has an annual production capacity of 459 000 tonnes of biodiesel and refined crude palm oil (CPO) products (2020).
Cepsa will contribute its technical expertise and experience in the development of large industrial projects and fuel production as well as its knowledge of the European market and the decarbonization goals of its customers in the transport sector.
Apical and Bio-Oils will ensure the supply of raw materials and contribute their own expertise in biofuel production.
Cepsa has been Bio-Oils’ largest customer for many years. We share many operational advantages such as interconnection and operating adjacent facilities, and using the Reina Sofia berth for the charge/discharge of our products through Cepsa vessels. This new joint venture is a natural evolution of our existing relationship, said Óscar García, CEO of Bio-Oils La Rábida.
The new plant, which will create approximately 2 000 direct and indirect jobs during its construction and operation phase, will include two pretreatment units and the capacity for flexible annual production of 500 000 tonnes of sustainable aviation fuel (SAF) and renewable diesel.
We believe the wider use of SAF and renewable diesel provides significant benefits on a global scale, both in terms of mitigating the effects of climate change and promoting sustainable economic growth. Apical’s ample supply of high-quality second-generation feedstock is key to ensuring the new joint venture delivers on our shared vision to reduce GHG emissions in land, sea, and air transport, said Dato’ Yeo How, President of Apical.
The plant is scheduled to begin operating in the first half of 2026.
The facility will be constructed with the latest technology specifically created for the production of this type of advanced biofuel.
Designed as a digital native plant, the new operation incorporates state-of-the-art technology including the latest industry advances in artificial intelligence (AI), Internet of Things (IoT), and data analysis to maximize process efficiency and ensure the highest standards of safety and environmental protection.
The sustainable fuels developed in this new plant will save 1.5 million tonnes of carbon dioxide (CO2) emissions per year, equivalent to 30 percent of emissions in the province of Huelva.
Cepsa has been investing in Huelva and Andalusia for almost 60 years and has been an active part and main player in the progress experienced in our land. Cepsa has made an outstanding contribution to our progress and to the creation of employment, with almost 8 000 direct and indirect jobs. Big bets like Cepsa’s confirm that we are on the right track, said Juan Manuel Moreno Bonilla, President of the Regional Government of Andalusia during his address.
According to Cepsa, the use of advanced biofuels can reduce CO2 emissions by up to 90 percent compared to traditional fuels, making biofuels a key element in enabling a fair energy transition to decarbonize transportation, particularly in sectors where electrification is complex, such as heavy road, maritime, and air transportation.
Cepsa’s chemical business will also benefit from this project by having access to organic waste feedstocks for the production of its sustainable product portfolio.
Commitment to sustainability
The construction of this new plant is part of Cepsa’s objective to lead the manufacture of 2G biofuels in Spain and Portugal.
The company will have an annual production of 2.5 million tonnes of biofuels by 2030, of which 800 000 tonnes will be SAF
This alliance is in line with the European Green Deal and the European Commission’s Fit for 55 package, which includes a legislative initiative called ‘RefuelEU Aviation’ that aims to boost the supply and demand of SAF in the European Union (EU) to 2 percent use by 2025, 5 percent by 2030 and 63 percent by 2050.
The agreement will serve to position Spain as a benchmark in the supply of SAF to airlines.
This alliance is a decisive step in our strategy to lead biofuels in Spain and Portugal and positions Andalusia as a European benchmark in sustainable energy production and circular economy. Second-generation biofuels are an immediate solution to support our customers’ energy as they can be used in conventional engines while enabling local development and increased energy autonomy in Europe, ended Maarten Wetselaar, CEO of Cepsa.