Galp and Mitsui form Joint Venture and Invest EUR 400M for Biodiesel Production

Galp, a Portuguese oil company, announced on September 25 that it had partnered with Japan's Mitsui to invest 400 million euros ($426 million) in an industrial-scale plant at its Sines refinery to produce biodiesel and biojet fuel from waste.

According to a statement, the companies will form a joint venture for the project that will be 75 percent owned by Galp. Galp also announced a final decision to invest 250 million euros in a 100-megawatt (MW) electrolyzer unit to produce green hydrogen to power the refinery.

It was stated that both plants would begin operations in 2025. The plant will produce 270,000 metric tonnes of Hydrogenated Vegetable Oil (HVO) per year.

It will transform waste materials, such as used cooking oils, into renewable biodiesel and bio-jet fuel - also known as sustainable aviation fuel (SAF) - using green hydrogen produced by the electrolyzer, which will have a capacity of 15,000 metric tons of green hydrogen a year.

SAFs are an alternative to traditional jet fuel aimed at being more environmentally friendly as they help replace dirtier petroleum products while providing new uses for waste.

The Sines refinery south of Lisbon is Portugal's largest consumer of natural gas-derived hydrogen, but Galp hopes to gradually produce zero-carbon fuel there through electrolysis using renewable energy. According to Galp Chairwoman Paula Amorim, the two projects are among the largest of their kind.

"These decisions are based on the expectation that the tax and regulatory developments in Portugal will not hinder the success of such large-scale investments," she stated.

Galp is attempting to accelerate the decarbonization of its processes and products, with plans to devote approximately 50% of its capital expenditure to low-carbon activities by 2025.