InterviewNeste pushes tech, sustainability

04 November 2008 16:01  [Source: ICIS news]

By Bohan Loh

SINGAPORE (ICIS news)--Finland’s Neste Oil is powering ahead its biofuels operations with the key themes of technology and sustainability, a company executive said on Tuesday.

On the technological front, Neste’s proprietary NExBTL know-how would allow biodiesel produced by the company to fulfil fuel standards required by the American Society of Testing and Materials (ASTM), which calls for lower cold-filter plug points (CFPP), which is the temperature at which the fuel starts to congeal and clog up engines.

“Our NExBTL technology is completely different; nobody else has anything similar. We don’t use the methyl ester process, we hydro-treat the product,” said deputy chief executive officer and executive vice president Jarmo Honkamaa. He added that the company can even produce biodiesel with cloud points of - 30° Celsius.

“This is why our biodiesel can go to any market in the world and into any engine, in any percentage, in all existing cars without any changes to the motors,” he added.

Simultaneously, Neste’s commitment to sustainability has paid off as the German Environment Ministry announced on 22 October, that palm- and soy-based biodiesel would not be credited against biofuel quotas unless the new sustainability quotas - to be announced by the European Union - were met.

“Our main supplier of palm oil is Malaysia’s IOI and they are in the process of getting the Roundtable on Sustainable Palm Oil (RSPO) certification,” Honkamaa said.

He also said that the company was in the process of drawing up the framework where the origin of the palm oil feedstock for its biodiesel production could be traced back to the plantation for RSPO certification verification and that third-party auditors have been engaged for assurance purposes.

“We welcome the sustainability criteria by the European Union as that would define the rules,” he said about the bill that is expected to be voted upon on 12 December.

Honkamaa also said that Neste has been exploring opportunities in algae and jatropha-based biodiesel production.

“We are making a lot of research and development effort into algae but this is not at a commercial stage yet, there needs to be more innovation and some practical problems need to be solved,” he said, adding that the current financial crisis might delay the process of these projects as they are mainly driven by debt financing.

“Perhaps it would be beyond 2015 before you have the big volumes algae-based oil anywhere in the world,” Honkamaa said.

Regarding the company’s base oils operations, Honkamaa predicted a curtailment in the growth rate of the segment on the recent slump in US automotive sales, which has seen General Motors reporting a 45% plunge in October turnover numbers and Ford Motor marking a 30% tumble in sales.

“There is a possibility that we may see some kind of stabilisation in the growth pattern in our base oil operations. But our project in Bahrain is going to only come on stream in 2011; so, let’s hope that the current crisis is behind us,” he said, referring to the joint venture plant with Bahrain's Oil & Gas Holding Co (OGHC) and Bahrain Petroleum Co (Bapco).

“All the existing cars on the roads still need to change their oils, depending on how much they are driven,” Honkamaa added.

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Bookmark Simon Robinson’s Big Biofuels Blog for some independent thinking on biofuels

By: Bohan Loh
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