Estonia’s energy company Eesti Energia is proceeding with the construction of a new oil plant after the Minister of Finance Martin Helme increased its equity capital by a monetary contribution of 125 million euros.
“The construction of the new oil plant is a long term and strategic investment that enables us to valorise the most important mineral resource of Estonia, create new jobs and reduce the impact to our environment,” said Prime Minister Jüri Ratas. “Creating additional jobs reduces the social risks of the ongoing transformation of the energy sector and supports Ida-Virumaa as a region.”
During the construction of the new oil plant, nearly 1,000 employees from construction and technology companies will be employed, including up to 700 local people. Additionally, indirect jobs will be created in the service sector during the construction period.
Mr Helme emphasised that the owner continues to expect Eesti Energia to develop a more efficient and cleaner use for oil shale, and oil production is a good example of this. The oil shale sector is a very important source of revenue for Estonia, with more than 100 million euros a year in recent years moving to the state treasury, and the oil shale industry helps to keep high-paying jobs in Ida-Virumaa.
“The construction of the new oil plant is in line with national strategy documents such as the Energy Development Plan, the Oil Shale Development Plan, and the basic principles of climate policy,” he said. “The mentioned strategic plans foresee a reduction in direct incineration of oil shale and an increase in the production of oil shale oil. In the current economic situation, it is important to make large infrastructure investments, keeping in mind, that it is fair to expect construction costs to reduce in the near future.”
Moreover, the CO2 emissions and oil shale use of the Estonian oil shale industry will decrease due to the fact that in parallel with the construction of the new oil plant, Eesti Energia will permanently close several older power units used for electricity production.
Hando Sutter, Chairman of the Management Board of Eesti Energia, recalled how the European Union is in a deep energy deficit and that there is a particularly large shortage of liquid fuels in Europe, 90 per cent of which are imported.
“Estonia is one of the few countries in Europe that has the capacity to produce liquid fuels on its own, and I think that it is a great asset,” he said.
The new oil plant will be completed in 2024 and is expected to reach full capacity a year later. The plant, a 286 million euros worth investment, is designed to produce 268,000 tonnes of liquid fuels per year.