Finnish energy firm St1, in collaboration with Swedish forestry company SCA, is developing a new large scale facility at its Gothenburg refinery to produce renewable fuels from residual tall oil.

The new plant would have the capacity to produce 100,000 tonnes/year of fuel from tall oil, which is a waste product created when pulping wood through the kraft process, St1 said in a statement on 21 May.

The construction of the facility was expected to cost roughly 500M SEK (US$57M) and it would become operational in 2021, pending appropriate regulatory permissions and final approval from both project partners.

SCA produces tall oil at its kraft mills in Munksund, Obbola and Östrand and, in the latter, tall oil production was projected to increase by more than 100% as a result of ongoing expansion.

The project partners said they would be able to establish a full value-chain for tall oil, from the raw material to the refining process, distribution and sale of the renewable fuel.

“Partnership with SCA is a key element in implementation of our renewable fuels investment programme and it secures supply of raw materials to meet the ambitious Nordic climate targets for 2030,” said St1 chair of board Mika Anttonen.