Reports related to this article:
Project(s): View 2 related projects in PECWeb
Plant(s): View 2 related plants in PECWeb
Released August 24, 2023 | SUGAR LAND
en
Written by Paul Wiseman for Industrial Info Resources (Sugar Land, Texas)--Having begun construction on a renewable diesel add-on to its Strathcona refinery in Edmonton, Alberta, Exxon Mobil Corporation (NYSE:XOM) (Irving, Texas) reports that progress is well under way. The company's majority-owned affiliate, Imperial Oil Ltd (Calgary, Alberta), is funding and overseeing the project. Completion is expected in early 2025, at which time the plant is expected to produce 20,000 barrels per day (BBL/d) of renewable diesel, enough to supply about 500,000 vehicles per day. It will do so using low-carbon hydrogen in a mix with locally-sourced plant-based feedstocks.
Overall, Imperial plans to invest US$17 billion in lower-emissions initiatives through 2027.
Through an agreement, Air Products and Chemicals Incorporated (NYSE:APD) (Lehigh Valley, Pennsylvania)--an international supplier of industrial gases--will pipe low-carbon diesel into Strathcona from a plant that is also under construction in Edmonton. According to a September, 2022 press release, Imperial will use this hydrogen to produce "renewable diesel at Strathcona that substantially reduces greenhouse gas emissions relative to conventional production. The hydrogen and biofeedstock will be combined with a proprietary catalyst to produce premium low-carbon diesel fuel."
The combination of local bio feedstocks and low-carbon hydrogen based on carbon capture and storage (CCS) technology is expected to reduce greenhouse gas (GHG) emissions in the Canadian transportation sector by about 3 million metric tons per year, ExxonMobil said in an email interview. Contracts between Imperial and local third parties for the bio feedstock are in the works while construction continues. Subscribers to Industrial Info's Global Market Intelligence (GMI) Petroleum Refining Project Database can click here for the related project report.
While exact feedstocks are not listed, typical plant-based sources include canola, sunflower, and soy. While animal fats can also be used as feedstocks, and are used extensively in the U.S., Canadian renewable diesel producers use more plant-based sources "because supplies are tied to a much smaller population," according to the Biofuels Annual released August 14 from the U.S. Department of Agriculture's Global Agricultural Information Network (GAIN).
Air Products is increasing investment in the aforementioned hydrogen plant to C$1.6 billion (US$1.2 billion). About half of the plant's output will go to Strathcona. Subscribers can click here for the related project report.
Strathcona, founded in 1947, makes asphalt and a full range of gasoline, diesel, aviation fuels, motor oils and liquid petroleum gases.
At least part of the impetus for the renewable diesel activity comes from Canada's Clean Fuel Regulation law, which was passed in 2020. Rules based on the law were published in June 2022, with implementation starting July 1, 2023. They require suppliers of liquid fuels such as gasoline, diesel and heating oil to gradually reduce the fuels' carbon intensity by about 15% below 2016 levels by 2030. A Canadian government site reports that vehicle traffic accounts for about 24% of total Canadian GHG emissions each year.
Additionally, in June 2022, Ottawa announced the C$1.5 billion (U.S.$1.2) Clear Fuels Fund, aimed at de-risking development of clean fuels including low-carbon hydrogen.
According to Canada Energy Regulator (CER) figures, Strathcona is one of seven renewable diesel facilities currently in the planning or development stages in the country. The total expected output from the seven adds up to about 70,000 BBL/d by 2027, up from zero in 2020. Other projects are underway in British Columbia, Quebec, Newfoundland and Labrador.
CER's most recent figures show the nation's renewable diesel demand reaching 9 million barrels per day in 2021, most of which at that time was imported.
What Is Renewable Diesel?
Renewable diesel is often preferred by end users over its older counterpart, biodiesel, due to the former's ability to be substituted 100% for standard diesel. Biodiesel, due to its water content, must be mixed with petroleum diesel in concentrations no higher than 20%, so it can never be a complete replacement.
Canadian renewable diesel consumption has been range bound between about 400 and 500 million liters since 2017 and was an estimated 400 million liters in 2023, according to the GAIN report. Renewable diesel production in Canada only began earlier this year, and the GAIN report estimates it will be about 60 million liters for 2023.
Subscribers can click here for all project reports mentioned in this article and click here for the related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Overall, Imperial plans to invest US$17 billion in lower-emissions initiatives through 2027.
Through an agreement, Air Products and Chemicals Incorporated (NYSE:APD) (Lehigh Valley, Pennsylvania)--an international supplier of industrial gases--will pipe low-carbon diesel into Strathcona from a plant that is also under construction in Edmonton. According to a September, 2022 press release, Imperial will use this hydrogen to produce "renewable diesel at Strathcona that substantially reduces greenhouse gas emissions relative to conventional production. The hydrogen and biofeedstock will be combined with a proprietary catalyst to produce premium low-carbon diesel fuel."
The combination of local bio feedstocks and low-carbon hydrogen based on carbon capture and storage (CCS) technology is expected to reduce greenhouse gas (GHG) emissions in the Canadian transportation sector by about 3 million metric tons per year, ExxonMobil said in an email interview. Contracts between Imperial and local third parties for the bio feedstock are in the works while construction continues. Subscribers to Industrial Info's Global Market Intelligence (GMI) Petroleum Refining Project Database can click here for the related project report.
While exact feedstocks are not listed, typical plant-based sources include canola, sunflower, and soy. While animal fats can also be used as feedstocks, and are used extensively in the U.S., Canadian renewable diesel producers use more plant-based sources "because supplies are tied to a much smaller population," according to the Biofuels Annual released August 14 from the U.S. Department of Agriculture's Global Agricultural Information Network (GAIN).
Air Products is increasing investment in the aforementioned hydrogen plant to C$1.6 billion (US$1.2 billion). About half of the plant's output will go to Strathcona. Subscribers can click here for the related project report.
Strathcona, founded in 1947, makes asphalt and a full range of gasoline, diesel, aviation fuels, motor oils and liquid petroleum gases.
At least part of the impetus for the renewable diesel activity comes from Canada's Clean Fuel Regulation law, which was passed in 2020. Rules based on the law were published in June 2022, with implementation starting July 1, 2023. They require suppliers of liquid fuels such as gasoline, diesel and heating oil to gradually reduce the fuels' carbon intensity by about 15% below 2016 levels by 2030. A Canadian government site reports that vehicle traffic accounts for about 24% of total Canadian GHG emissions each year.
Additionally, in June 2022, Ottawa announced the C$1.5 billion (U.S.$1.2) Clear Fuels Fund, aimed at de-risking development of clean fuels including low-carbon hydrogen.
According to Canada Energy Regulator (CER) figures, Strathcona is one of seven renewable diesel facilities currently in the planning or development stages in the country. The total expected output from the seven adds up to about 70,000 BBL/d by 2027, up from zero in 2020. Other projects are underway in British Columbia, Quebec, Newfoundland and Labrador.
CER's most recent figures show the nation's renewable diesel demand reaching 9 million barrels per day in 2021, most of which at that time was imported.
What Is Renewable Diesel?
Renewable diesel is often preferred by end users over its older counterpart, biodiesel, due to the former's ability to be substituted 100% for standard diesel. Biodiesel, due to its water content, must be mixed with petroleum diesel in concentrations no higher than 20%, so it can never be a complete replacement.
Canadian renewable diesel consumption has been range bound between about 400 and 500 million liters since 2017 and was an estimated 400 million liters in 2023, according to the GAIN report. Renewable diesel production in Canada only began earlier this year, and the GAIN report estimates it will be about 60 million liters for 2023.
Subscribers can click here for all project reports mentioned in this article and click here for the related plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
