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MOL Group moves up the value chain by becoming biofuel producer

As a result of several years of research and development work, Hungarian multinational oil and gas company MOL Group announced to move up the value chain by becoming a biofuel producer, through the implementation of an investment in its Danube Refinery in Százhalombatta. Through a new process, the bio-feedstock will be processed together with the fossil materials already during production to produce more sustainable diesel with the same quality, reducing CO2 emissions by 200,000 tons per year.

“As a biofuel user, MOL Group has purchased more than 500.000 tons of biofuels (bioethanol and biodiesel) for blending,” pointed out Gabriel Szabó, Executive Vice President of MOL Group Downstream. He underlined that with this investment, MOL Group has become a biofuel producer and started to produce sustainable diesel within the group.

“The benefits are twofold, as we produce more sustainable fuel, we also contribute to the circular economy by recycling waste,” said Mr Szabó adding that this is also in line with the group’s recently updated strategy, SHAPE TOMORROW as MOL is planning to produce more than 100,000 tons of biofuel by 2030.

During co-processing, the bio-feedstock is processed together with the fossil material in the production of diesel fuel. Vegetable oils, used cooking oils and animal fats can also be used for this purpose. As a result of the co-processing, the diesel produced will be partially renewable without changing its quality compared to diesel produced entirely from crude-oil. The main advantage of this process is that it can be still blended with a maximum of 7 per cent of bio-feedstock based fuel, in line with diesel standards, allowing the bio-share of the diesel to be higher.

Considering the EU’s and also MOL Group’s goal of achieving carbon neutrality in terms of carbon emissions by 2050, the renewable share obligations of transportation fuel are continuously increasing. Accordingly, the biocomponent content expectations have also increased across MOL Group’s fuel markets, which have so far been met mainly by blending bioethanol and biodiesel.

MOL started co-processing as an R&D project in 2012 based on the research results of Pannon University. Types and quality requirements of processable raw materials were determined and the investment was launched in 2018. This included the necessary infrastructure development for storing and processing the new bio-materials.

The test phase started in March, last year. The bio-component produced with this process has significantly higher CO2 saving potential than other types of biofuels produced from the same feedstock. MOL estimates that the investment will reduce CO2 emissions by 200,000 tons annually.

As for the future, MOL aims to gradually increase the share of waste and by-products in its raw materials to further reduce the carbon footprint of its fuels.

MOL Group has approved its updated long-term strategy recently, setting out the company’s vision and ambitions beyond 2030. MOL wants to significantly increase its EU Taxonomy-aligned climate-friendly investments to exceed 50 per cent of total CAPEX by 2030 and to approach 100 per cent by 2050, or earlier.

The company also wants to play a key role in shaping the low-carbon circular economy with investments in new businesses such as waste integration and utilisation, recycling, carbon capture, utilisation and storage (CCUS), advanced biofuels and potentially hydrogen-related opportunities. In the next five years, MOL will spend one billion US dollars on new, low-carbon and sustainable projects to become a key player in CEE in the circular economy. MOL also aims to transform its Downstream segment into a highly efficient, sustainable, chemicals-focused leading industry player.

Photo: MOL website

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