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Investancia to plant 50 million Pongamia trees in landmark deal with ECB Group

Investancia Paraguay S.A. a subsidiary of the Netherlands-headed Investancia Holding B.V., a leading agroforestry and research company has announced that it has signed a 30-year supply deal with ECB Group that will see Investancia deliver 300 000 tonnes of Pongamia ‘reforestation oil’ annually by 2030. The landmark deal will see some 50 million trees planted on 125 000 hectares (ha) in Paraguay over the next decade.

The signing of the landmark Pongamia oil feedstock supply deal with Marcel van Heesewijk (left), CEO and Founder of Investancia, and Erasmo Carlos Battistella, Founder and CEO of ECB Group (photo courtesy Investancia).

The Investancia tree propagation and R&D centre, located near Carmelo Peralta, Alto Paraguay, is the world’s largest dedicated elite Pongamia tree (Pongamia pinnata) production site. Its current annual production capacity of 1 million trees will be scaled over the next 10 years to a total of 50 million trees, planted across 125 000 hectares (ha).

The oil from the beans harvested from the Pongamia trees will be refined by ECB Group Paraguay at its new 800 000 tonne-per-annum state-of-the-art Omega Green biorefinery, currently under development in Villeta, near the Paraguayan capital Asunción.

We are extremely proud to team-up with the strategic investment of ECB to establish the first major HVO refinery in the southern hemisphere. During the last year, we were able to jointly develop plans to put South America, and more specifically Paraguay on the map as the leading region for next-generation green fuels using feedstock generated from our certified reforestation activities in the Paraguayan Chaco. Our combined efforts have immediate and multiple impacts on climate change, said Marcel van Heesewijk, CEO and Founder of Investancia.

Low carbon intensity

Investancia started developing its feedstock from reforestation in 2014, with early genetics development support from US-headed agricultural technology partner TerViva BioEnergy, Inc (TerViva).

According to Investancia its Pongamia oil, refined for hydrotreated vegetable oil (HVO), is a low carbon, low indirect land-use change (ILUC) and complies with the EU’s recast Renewable Energy Directive (RED II) and California’s Low Carbon Fuel Standards (LCFS).

In addition, a report by Germany-headed MEO Carbon Solutions GmbH (part of ISCC) has found that Pongamia oil has one of the lowest carbon intensity (CI) levels of all available feedstocks and is three times less carbon-intensive than soybean oil.

Pongamia trees. The Investancia tree propagation and R&D centre, located near Carmelo Peralta, Alto Paraguay, is the world’s largest dedicated elite Pongamia tree (Pongamia pinnata) production site (photo courtesy Investancia).

The company’s first scaled reforestation programmes have commenced on 2 000 ha of leased land. Investancia has import and environmental licenses with the Ministries of Agriculture and Environment, MADES and SENAVE, in Paraguay, where the trees are being planted.

Multiple benefits

However, the Pongamia tree’s impact goes beyond producing HVO/SAF feedstock. Native to India and Australia, the trees are adaptive to grow on degraded land, flood and drought resilient yet are non-invasive. A legume that is related to soybean and pea, the tree produces a bean containing oilseeds that are high in protein and mid-oleic vegetable oil.

Having nitrogen-fixing roots, the tree does not require fertiliser and is highly efficient at removing carbon. Each tree sequesters an average of 44 kg of carbon dioxide (CO2) annually – the highest of any oil-producing crop while a tree can yield as much as tenfold the tonnage of beans per ha compared to soybeans.

Pongamia tree bean pods. Related to both peas and soybeans, the oilseeds are a suitable high-yielding biofuel feedstock while the remaining protein-rich press-cake is used as animal feed (photo courtesy Investancia).

Furthermore, Pongamia meal – sourced from the residual press-cake after the harvesting and crushing processes to extract the oil – is also rich in protein and is currently sold as animal feed.

With this Pongamia oil supply agreement, we seek to diversify the portfolio of raw materials for the operation of our Omega Green biorefinery with lower carbon intensity solutions between the production harvests of vegetable oil. This is a concrete and innovative decision in this direction, which in the medium term can reach one-third of our feedstock needs for the production at Omega Green. The decision also already has a direct positive impact on Paraguay’s economy by promoting agricultural production within a reforestation system that helps with carbon sequestration, remarked Erasmo Carlos Battistella, Founder and CEO of ECB Group.

Major renewable fuel agreements

ECB Group has already secured significant multi-year offtake agreements with global oil majors for its expected renewable fuel production. In early January 2021, it signed an agreement with bp plc to supply over 1 billion litres of advanced biofuels during 2024-2029, bp’s first significant purchase of biodistillates in South America.

Also in January 2021, ECB Group signed a multi-year agreement with Shell Trading (US) Company that will provide more than 500 million litres of renewable diesel and renewable jet fuel per year to Shell. This contract is also expected to run from 2024-2029, totalling 2.5 billion litres of HVO/SAF.

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