Spanish energy company Cepsa has formed a joint venture to develop a large-scale biofuels plant in the south of the country with a tag price of up to €1 billion ($1.1 billion).
Cepsa and Bio-Oils, the Spanish biofuels arm of Singapore-headquartered vegetable oils processor Apical Group, will jointly work on the facility, scheduled to come online in 2026, that will be built in Cepsa’s La Rabita Energy Park in Huelva, in Spain’s Andalusia region.
The facility targets a nameplate capacity of 500,000 tonnes per annum of sustainable aviation fuel (SAF) and renewable diesel for aviation, maritime and land transport applications.
That volume would equal to the saving of 1.5 million tpa of carbon dioxide, according to company estimates.
Cepsa described the project as “the largest second generation biofuels plant” in southern Europe.
Decisive step
The company’s chief executive Maarten Wetselaar said in a statement that the joint venture is “is a decisive step in our strategy to lead biofuels in Spain and Portugal”.
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The two treatment units plant will source organic non-food waste feedstock supplied through a long-term agreement from Apical Group, the parent company of Bio-Oils. The feedstock will include agricultural residue and used cooking oils.
The agreement, Cepsa said, allows the company to overcome one of the main hurdles in scaling bio-refining, which is the access to feedstock.
Biorefining is a fast-growing sector that has been the target of large-scale investments from European companies, including fellow Spanish energy producer Repsol and Italy’s Eni.
The use of biofuels can reduce CO2 emissions by up to 90% compared with conventional fossil-based fuels, and could offer a way to decarbonise some hard-to-abate sectors including aviation, shipping and heavy land transport.
Cepsa aims to increase its biofuels output to 2.5 million tpa by 2030, including 800,000 tonnes of SAF.