Finland-headed forest industry major UPM has announced that following extended technical, commercial, and strategic evaluations, it plans to discontinue the development of its potential second biomass-to-fuels refinery at the Port of Rotterdam, the Netherlands.
As a result, UPM plans to halt all engineering work related to the CAPEX investment in Rotterdam and to withdraw from all site-related commitments associated with the Rotterdam Biofuels Refinery investment.
At the same time, UPM said that it will “continue to seek growth in biofuels by advancing the development of proprietary technologies enabling the extension of feedstock options to other forms of competitive and sustainable biomass and the work related to the qualification and commercialization of Crude Tall Oil (CTO)-derived UPM biofuels for jet engine fuels.”
Renewable fuels and renewable chemicals are the central elements of UPM’s long-term growth in decarbonization solutions. The Lappeenranta biofuels biorefinery will remain the nucleus of our growing biofuels platform, said Harald Dialer, EVP of UPM Biorefining and Technology.
Aligned with this strategic direction, UPM is focusing on three targeted growth areas in its biofuels business:
- Evaluating the potential to debottleneck the Lappeenranta Biorefinery to capture low-CAPEX expansion opportunities and further leverage the strong market performance of CTO-derived biofuels;
- Enabling the qualification of CTO-derived UPM biofuels as Sustainable Aviation Fuel (SAF). This strategic direction is supported by successful SAF trials conducted with Austrian aircraft manufacturer Diamond Aircraft using Austro Engine propulsion, and by continued progress in the technical acceptance process at the American Society for Testing and Materials (ASTM), where results from trials and stakeholder reviews have been consistently positive; and
- Continuing feedstock technology development to qualify and enable the use of additional competitive and sustainable biomass, supporting the cost-efficient production of high-quality biofuels for both road and aviation applications.
We continue to see strong long-term market potential for biomass-based fuels, especially in Europe, where greenhouse gas (GHG) reduction commitments continue driving the need for sustainable alternatives to fossil fuels across transport modes, but specifically in road and aviation. Our biofuels portfolio is well-positioned through our access to strategic feedstocks, its superior GHG savings potential, and strong regulatory acceptance. We are in an advanced position to deliver scalable commercial growth with sustainable biofuels, said Harald Dialer.
