Neste Oil signed an agreement today with Stora Enso, an integrated paper,
packaging, and forest products company, to join forces to develop technology for
producing new-generation biofuels from wood residues to replace fossil fuels and
cut greenhouse gases. The first step will be to design and build a demonstration
plant at Stora Enso's Varkaus Mill in Finland. The plant, owned on a 50/50 basis
by the two companies, is expected to start up in 2008 and will produce heat and
electricity for use locally and crude biodiesel to be refined into commercial
fuel at Neste Oil's refinery in Porvoo.
Expertise from Neste Oil, Stora Enso, and VTT Technical Research Centre of
Finland will be utilized to implement the development phase and commercialize
wood-based biofuel production. Neste Oil and Stora Enso see the growing biofuel
market in Europe as a promising and sustainable business opportunity for meeting
the increasing demand for premium-quality products made from a wide variety of
feedstocks. The challenges related to generation of clean synthesis gas from
wood will need to be solved before wood-based biomass can be used in biofuel
production. The project will also focus on using Fischer-Tropsch process to
produce crude biodiesel from gas.
The EUR 14 million demonstration plant will be integrated into the energy
infrastructure of the Varkaus Mill, and the gas produced will equal the energy
needed to heat 4,300 homes and cut local carbon dioxide emissions significantly.
Full-scale commercial production
Following the development phase and completion of the technical solutions, and
after the partners have gained sufficient experience from the demonstration
plant, the joint venture will build a full-scale commercial production plant at
one of Stora Enso's mills. This facility will be owned on a 50/50 basis by the
JV partners.
Stora Enso will be responsible for supplying wood biomass and utilizing heat
generated. Wood biomass will be supplied from forests according to ecological
preconditions. Neste Oil's responsibility will final refining and marketing of
the biofuel.
A natural step forward in cutting greenhouse gases
The European Union has set a target of replacing 5.75% (18 million tons) of the
fossil fuels used in transportation with biofuels by 2010 and 10% by 2020, This
will mean replacing 30 million tons of fossil fuels and will require significant
increases in biofuel production.
Developing wood-based biofuels is a logical step for Neste Oil and underpins the
company's strategic goal of producing high-quality traffic fuels from a broad
base of feedstocks. The project is designed to complement Neste Oil's biofuel
portfolio. The company is currently commissioning its first plant to produce
170,000 t/a of NExBTL Renewable Diesel, a high-quality fuel offering excellent
engine performance and low tailpipe emissions, from vegetable oil and animal fat
at its Porvoo refinery in Finland. A second similar plant is also under
construction at Porvoo.
Press conference in Helsinki at 9:00 EET
You are very welcome to participate in a press conference in Helsinki today. The
conference will be hosted by Neste Oil's CEO Risto Rinne and Stora Enso's CEO
Jukka Härmälä, and will be held in Finnish.
Venue: Restaurant Bank, Union Square Auditorium
Address: Unioninkatu 22
Time: 9:00 a.m. EET
Neste Oil Corporation
Osmo Kammonen
Senior Vice President, Communications
For further information, please contact:
Kimmo Rahkamo, Executive Vice President, Biodiesel, on +358 10 458 4247
Harri Turpeinen, Vice President, Research & Development, on +358 10 458 7087
Neste Oil Corporation is a refining and marketing company focused on advanced,
clean traffic fuels, with a strategy that prioritizes growing its refining and
premium-quality biodiesel businesses. Neste Oil's refineries are located at
Porvoo and Naantali in Finland, and have a total refining capacity of approx.
250,000 bbl/d. The company's sales totaled EUR 12.7 billion in 2006, and it
employs around 4,700 people. Neste Oil is listed on the Helsinki Stock Exchange.
For further information, see www.nesteoil.com.
Stora Enso is an integrated paper, packaging and forest products company
producing publication and fine paper, packaging board and wood products - all
areas in which the Group is a global market leader. Stora Enso's sales totaled
EUR 14.6 billion in 2006. The Group has some 44 000 employees in more than
40 countries on five continents. Stora Enso has an annual production capacity of
16.5 million tonnes of paper and board and 7.4 million cubic meters of sawn wood
products, including 3.2 million cubic meters of value-added products. Stora
Enso's shares are listed in Helsinki, Stockholm and New York.