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Neste Oil: a 5-Minute Guide

Jim Lane

Company description:

Neste Oil is a refining and marketing company, with a production focus on premium-quality, lower-emission traffic fuels. The company produces a comprehensive range of major petroleum products and is the world’s leading supplier of renewable diesel. The company has operations in 15 countries. Its growth strategy is focused on producing premium- quality renewable diesel fuel. The company had net sales of EUR 11.9 billion in 2010 and employs around 5,000 people.

Address:
Keilaranta
 P.O. Box 95
00095 NESTE OIL

Year founded
Established in 1948

Annual Revenues:
Around EUR 11.9 billion in 2010

Major Investors

Neste Oil’s share is listed on the NASDAQ OMX Helsinki with the symbol NES1V.  It trades as NEF on German Exchanges, and NTOIF on the US Pink Sheets. The company’s biggest shareholder is the Prime Minister’s office.

Neste Oil Rotterdam.png
Image: Neste Oil Rotterdam Facility.  Source: Neste Oil

Type of Technology(ies)

Neste Oil has developed a premium quality NExBTL renewable diesel production technology which allows flexible use of any vegetable or waste oil in the production of premium-quality renewable diesel and aviation fuel. Based on its technical qualities, NExBTL diesel is one of the best diesel fuels in the world. NExBTL is produced by hydrotreating vegetable or waste oils. As a hydrocarbon it corresponds to the chemical composition of traditional diesel.

Neste Oil’s major investment projects are linked to increasing the company’s NExBTL renewable diesel capacity. In 2011, Neste Oil started up the Europe’s largest renewable diesel plant in Rotterdam. The plant has a capacity of 800,000 t/a. Neste Oil already operates a renewable diesel plant in Singapore that came on stream in 2010 and two plants in Porvoo in Finland that came on stream in 2007 and 2009. All Neste Oil’s NExBTL plants are capable of producing both NExBTL renewable diesel and NExBTL renewable aviation fuel.

With the Rotterdam start-up, Neste Oil’s major €1.5 billion investment program aimed at increasing the renewable diesel capacity and the company is very well placed to meet world’s growing energy needs and demand for cleaner, sustainable bio-based fuels.

Feedstocks:

Neste Oil’s NExBTL renewable diesel production technology allows flexible use of any vegetable or waste oil in the production of premium-quality renewable diesel without compromising on quality.

At the moment, Neste Oil produces NExBTL renewable diesel from a mix of palm oil, stearin and palm oil fatty acid distillate (PFAD) which are by- products of palm oil production, rapeseed oil, jatropha oil, camelina oil, soybean oil as well as waste animal fat produced by the food processing industry.

Widening the raw material base is one of the company’s main future goals. About 80% of the company’s R&D costs totaling approximately 40 million euros annually are directed to researching renewable raw materials. Progress continues to be made and in 2011 Neste Oil expanded the raw material feedstock with jatropha oil, camelina oil and soybean oil. In addition, research has shown that algae oil and microbial oil, together with wax derived from wood-based biomass, can all be used as feedstocks for producing NExBTL renewable diesel.

Notable successes in this area include:
patented a waste-based microbial oil technology
progressed with research on algae oil and produced an initial trial batch
achieved good results at our pilot plant in producing biowax from wood- based biomass and started environmental impact assessments for a possible commercial plant
partnered with the world’s leading research institutes, companies and
universities to find ways to produce renewable raw materials on industrial scale

Products

NExBTL renewable Diesel

Based on Neste Oil’s proprietary technology, premium-quality NExBTL renewable diesel is the most advanced diesel fuel on the market today. It easily outperforms both conventional biodiesel and fossil diesel, and can be produced from a flexible mix of vegetable oils and waste animal fat sourced from the food industry. Neste Oil’s procurement chain ensures that all the raw materials it uses for NExBTL are produced responsibly. NExBTL renewable diesel has been shown to reduce greenhouse gas emissions by over 40% over the product’s entire life cycle when compared to fossil diesel. Its lower tailpipe emissions also make a valuable contribution to enhancing overall air quality.

NExBTL renewable aviation fuel
Neste Oil is a global pioneer in aviation biofuels. The company’s NExBTL renewable aviation fuel meets the very stringent quality standards demanded of aircraft fuel and can be produced in industrial quantities. Production of Neste Oil’s renewable aviation fuel is based on the company’s NExBTL technology.

NExBTL renewable aviation fuel can significantly reduce an aircraft’s greenhouse gas emissions compared to fossil fuel. In addition to a smaller carbon footprint, it also offers lower emissions of other pollutants such as NOx. Neste Oil’s NExBTL renewable aviation fuel is a pure hydrocarbon comparable to fossil-based aviation fuel. NExBTL renewable aviation fuel is fully compatible with all current aircraft engines and no aircraft-related investments or modifications are needed before it can be used.

Past Milestones
1. Compared to fossil diesel, NExBTL reduces greenhouse gas emissions by over 40% over its entire lifecycle. NExBTL is currently being sold to consumers in Finland and to other oil companies in Europe and North America to be used as a premium quality biocomponent. It can be used in blends in any concentration, i.e. 0–100% of the content. The company started up three plants in Finland, Singapore and Rotterdam and increased its total production capacity to 2.0 million t/a.

2. Lufthansa started commercial flights powered by Neste Oil’s NExBTL renewable aviation fuel in summer 2011. This was the first time that renewable fuel is used in regular commercial airline service. Neste Oil is currently one of the only companies in the world capable of producing renewable aviation fuel at commercial scale.

3. Neste Oil is committed to using sustainably produced bio-based raw materials. The company has developed its own sustainability verification system which exceeds the industry standards for renewable raw material procurement and meets the requirements of legislation. The commitment to expanding the raw materials portfoliio has meant Neste Oil has successfully widened its raw material base to produce NExBTL renewable diesel. About 80% of the company’s R&D costs totaling approximately 40 million euros annually are directed to researching renewable raw materials.

New raw materials, such as jatropha, camelina and soybean oils have been introduced. In addition, research has shown that algae oil and microbial oil, together with wax derived from wood-based biomass, can all be used as feedstocks for producing NExBTL renewable diesel. Neste Oil’s work on sustainability has received recognition in numerous international comparisons for many years in succession (e.g. Dow Jones Sustainability Index, Global 100 list, Forest footprint disclosure).

Future Milestones
1. Generate profitable growth in the renewable fuels market by developing global customer base and supply chain, expanding the feedstock base, ensuring smooth operation of the new production plants and taking part in developing and planning new legislation.
2. Continue researching and introducing new raw materials. When selecting its inputs, Neste Oil prioritises suppliers that follow sustainable cultivation and production practices and have a good greenhouse gas balance. The final deployment decision is also affected by raw material availability and consistency of supply, as well as price.
3. Develop new applications, such as NExBTL renewable aviation fuel, that help customers to reduce greenhouse gas emissions and dependence on fossil fuels.

Business Model:

Neste Oil is a refining and marketing company, that produces renewable fuels based on its proprietary NExBTL technology. The company owns and operates four production plants producing NExBTL renewable diesel. The output of the plants is sold to other oil companies in European and Northern American markets to be used as a premium quality bio- component.

Competitive Edge(s):
Neste Oil’s strategy is founded on its unique ability to refine premium- quality fuels from a wide range of different, cost-effective feedstocks. Specialisation and in-depth expertise are central to enabling Neste Oil to
succeed in the international marketplace, despite its small relative size.

Neste Oil’s strengths in renewable fuels business include: cutting-edge NExBTL technology and product, growing production capacity, and industry-leading operations based on sustainable raw material procurement. Additionally, Neste Oil’s expertise in research and technology is one of the company’s key success factors.

Research, or Manufacturing Partnerships or Alliances.

NExBTL renewable diesel, for example, is the outcome of an intensive R&D effort.
Neste Oil has invested around EUR 40 million annually in R&D in recent years, of which around 80% has gone on research into renewable raw materials and technology for refining these inputs.
Neste Oil is involved in research in both completely new raw materials such as microbes, algae, and wood-based biomass, and existing alternatives such as used cooking oil and waste fat from the fish processing industry.

Neste Oil cooperates closely with some of the world’s leading research institutes and companies.

Neste Oil and Stora Enso are collaborating on research into utilizing wood biomass. The partners will decide whether to go ahead with basic engineering on a 200,000 t/a plant when the question of public subsidy for the project is solved.

Neste Oil, Boreal Plant Breeding, and Raisio are developing high- yielding rapeseed varieties that could be used as a raw material for renewable diesel.

Neste Oil has researched waste-based microbial oil in cooperation with the Aalto University School of Technology.

Neste Oil takes part in international algae research projects in Australia and the Netherlands to test various methods for growing algae in outdoor conditions.
Neste Oil and the Finnish Environment Institute have launched a joint algae research program testing the lipid production capacity of different types of algae and analyzing how the quality and quantity of these lipids can be optimized by adjusting the conditions under which algae are grown.

Neste Oil cooperates with approximately 25 universities and research institutes worldwide.

Stage (Bench, pilot, demonstration, commercial)
Commercial

Company website: http://www.nesteoil.com/

Disclosure: None.

Jim Lane is editor and publisher  of Biofuels Digest where this article was originally published. Biofuels Digest is the most widely read  Biofuels daily read by 14,000+ organizations. Subscribe here.



was posted on AltEnergyStocks.com.


       

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