Palm oil-producer Brasil Biofuels (BBF) plans to build Brazil's first hydrotreated vegetable oil (HVO) plant after reaching a supply agreement with Brazil's largest fuel distributor Vibra Energia.
The plant, which will be installed in the Manaus free-trade zone in Amazonas state, would start operating in January 2025, with production of around 500mn l/yr (8,600 b/d).
Vibra will be the sole offtaker.
Initially, Vibra plans to market the HVO - also known as green diesel - to buyers in the Amazon basin, with the goal of contributing to the decarbonization of the region's energy mix. The product will later be sold to other parts of Brazil and potentially to the export market.
BBF, the largest palm oil producer in Brazil, has multiple investments in the Amazon basin, which use palm-based biodiesel in place of fossil fuels.
BBF will use palm oil from its own plantations as feedstock. The company plans to expand planting of palm trees on roughly 120,000ha (296,526 acres) of environmentally degraded areas in the Amazon basin.
Because of a 2010 law, palm cannot be planted on areas that were deforested after 2007. And because of the 2008 forestry code, properties in the Amazon biome are required to hold 80pc of their total area in reserve.
BBF has been active in power generation auctions for remote regions of the Amazon basin since 2015. In a May auction, the company won contracts to supply 10 regions in Para state and two areas in Rondonia state with biodiesel-fired power plants.
The company has 20 such plants operating in the Amazon basin.
Because of the reduction of carbon emissions from substituting diesel with a renewable fuel, BBF will be eligible to issue Cbio carbon credits from the plants.
Brazil's lower house is currently debating a bill that would stipulate a timeline to implement mandatory blends for advanced biofuels including HVO, synthetic paraffinic kerosene (SPK), or bio-jet fuel, and other advanced biofuels.
For Vibra, the HVO deal with BBF is part of a strategy to reduce its carbon footprint and get ahead of Brazil's energy transition.
Argus Media Limited published this content on 24 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2021 16:39:01 UTC.