Uusiutuvat polttoaineet jäte- ja tähdevirroista

Teknologiajohtaja Lars Peter Lindfors, Neste Oil

Neste Oil in brief

Refining capacity:

15 million t/a of

petroleum products

and 2 million t/a of

renewable diesel

Net sales: € 17.5

billion (2013)

Listed on the

Helsinki Stock

Exchange

Largest owner:

Finnish State

(50.1%)

A refining and

marketing company

focused on

premium-quality

traffic fuels

Operations in 15

countries; employs

approx. 5,000

people

2

Being innovative drives our leadership position

3

Creating

unique

technological

innovations

Expanding

raw material

base

Several new

products

since 2008

1,000

professionals

in R&D and

engineering

Co-operation

with large

number of

leading

universities,

institutes and

companies

City-gasoline:

lead-free, with

MTBE as an

important

component

1980

Lead-free Futura

95E, replacing

92-octane

gasoline

Cleaner products along the way

Futura Citydiesel:

end of sales for the

low-aromatic and

nearly sulfur-free

gasoline

1990

Sulfur-free

gasolines and

diesel fuels

2000

NExBTL

renewable

aviation fuel

2010

Neste Alfa

lubricants

Futura brand:

gasoline that keeps

engines clean

City Futura, with an

oxygen-containing

MTBE component

synthetic PAO

VHVI

base oils

New Futura:

less sulfur than

ever before

New Futura

gasoline market

launch

Neste Green

diesel

NExBTL diesel

from renewable

materials

Neste Green 100

diesel

Neste Pro

Diesel

4

5

So far we have consumed over 1,000 billion barrels of oil, but there is plenty of it left

6

Road transportation dominating total oil demand also in

coming decades – fuel economy improving significantly

Source: ExxonMobil, The Outlook for Energy 2012; BP, Energy Outlook 2012

0

10

20

30

40

50

60

70

Mbpd

2030 Increased

use of

alternatives

Improved

vehicle

efficiency

Reduced

average

usage

Increased

number of

vehicles

2010

Biofuels Non-OECD

OECD

Non-OECD

OECD

Other*

Oil demand in road transportation

* Including GTL, CTL, LNG and electricity

• Heavy duty fleets, aviation and city traffic have limited ways to increase renewable share – advanced biofuels, e.g. NEXBTL, are a viable option

• Hybrid cars increase rapidly after 2020 (representing ~10 % of fleet in 2030)

• Electric / natural gas vehicles expected to remain marginal due to cost and functionality considerations

GHG emissions from well-to-wheel strongly

dependent on feedstock and technology

Well-to-wheel gCO2eq/km

0 50 100 150

gasoline

E10

E85

Diesel

B7

dieselhybrid

renewable diesel (NEXBTL)

electric car (EU-averageelectricity)

Source: JEC, 2014

8

To combat

climate change

and

reduce emissions

To reduce

society’s

dependency on

crude oil and

imports

To safeguard

energy security

The drivers for biofuels

12 13

20

5 5

8

5 5

6

4 4

5

0

10

20

30

40

50

2014 2015 2020

Asia-Pacific

Latin America

North America

Europe

+8% p.a

Bio/renewable diesel demand,

million tons

26 27

39

9

Source: Neste Oil estimates

The growth estimate

• Since 2007, the renewable business has grown from 0 in earnings and revenue to earnings of 273 m€ and revenues of 2,5 bn € in 2013

• Customers are choosing NEXBTL due to its superior quality and flexibility using it as drop in fuel

• Strong market position in several European countries and in North America

10 10

Neste Oil – The leading producer of renewable diesel in the world

4.8 million

tons

avoided

GHG

emissions

Fuelling

2.6 million

cars with

renewable

fuel

11

FAME = Fatty Acid Methyl Ester, conventional biodiesel

RME = Rapeseed Methyl Ester, conventional biodiesel

HVO = Hydrotreated Vegetable Oil, advanced biofuel i.e. renewable fuel

BTL = Biomass to Liquid

NEXBTL renewable fuels – fully compatible with fossil diesel

Bio-based

hydrocarbon

(renewable diesel,

jet fuel, bionaphta,

biopropane)

Biodiesel

(FAME / RME) Fossil diesel

Renewable diesel

(HVO)

e.g. NEXBTL

Fischer-Tropsch

(BTL)

Vegetable oils &

animal fats (mainly

rapeseed oil)

Crude oil

(mineral oil)

Flexible mix of raw

materials

(vegetable oils

& waste fats)

Biomass Raw material

Esterification Traditional refining Hydrotreating Gasification &

Fischer-Tropsch Technology

Ester-based,

conventional

biodiesel

Hydrocarbon

(gasoline, jet fuel,

diesel)

Bio-based

hydrocarbon

(renewable gasoline,

jet fuel, diesel)

End product

O

II

H3C-O-C-R

CnH2n+2

+ aromatics CnH2n+2 CnH2n+2

Chemical

composition

Waste animal fat from

the food processing

industry

Crude palm oil

Waste fat from the

fish processing

industry

Camelina oil Jatropha oil Soybean oil Rapeseed oil

• Next generation feedstock to include waste streams from

forestry and agricultural activities, as well as algae oil

12

Technical

corn oil

Tall oil pitch Vegetable oil residues

(stearin, PFAD and

spent bleaching oil)

Range of renewable raw materials used

commercially is growing

Used cooking

oil

Waste/residue

Vegetable oils

More than half of the renewable feedstock

used by Neste Oil is waste/residue based

13

Neste Oil renewable feedstock split, 2013

H2/2014 waste/residue based feedstock: 66 %

48 % 52 %

0

200 000

400 000

600 000

800 000

1 000 000

1 200 000

1 400 000

2007 2008 2009 2010 2011 2012 2013

14

Development/committment is required to

increase the usage of waste/residue streams

Technology

• Flexible production

technologies

• Pretreatment

solutions

Global procurement

network

• Logistics

• Qualit assurance and

segregation

• Sustainability

Partnerships

• Commercial concepts

• Co-operation

Several challenges Availability, small local volumes, varying quality level, lack of logistic solutions

• Global energy

consumption / Transport

sector: 95000 PJ/a

• The accessability of the

waste/residue feedstock

in the table corresponds

to 1/3 of global energy

consumption in the

transportation sector

15

Waste/residue streams are crucial for next

generation applications

Availability of some waste/residue based feedstock (PJ/a)

Finnish forests are not able to supply the

transportation fuel needs in Finland at present

Oil product demand in Finland (2014) vs. theoretical

maximum of wood based fuel availability (Mt/a)

•~ 35 Mt dry wood grows in Finland annually

•Currently 70% of Finland’s annual wood growth is

already in use

• If all the rest wood (30%) would be used for fuel, the

amount would be ~ 10 Mt

•With 20% mass conversion, the corresponding

theoretical maximum fuel volume is ~ 2 Mt/a, i.e.

30% of the demand

Sources: Metla, Wood Mackenzie

Conversion from cubic meters to dry t: 0,35

Fuel from wood

0,7

1,5

4,3

2,0

Jet

Max. wood availability

Diesel/Gasoil

Gasoline

Biocrude

Pyrolysis (fast/

catalytic/hydrous) Upgrading

Biofuels

17

Technologies from wood to biofuels is

still on the development stage Microbial oil

Sugar

Feedstock Product

Renewable diesel Fractionation

& hydrolysis

Hydrotreatment Fermentation

Cellulosic ethanol/

butanol

Syngas

Fischer-Tropsch

Gasification

BtL biofuels

Methanol,

other alcohols

Gasoline components

BioDME

Ethanol Fermentation

Catalytic

conversion

Fermentation

Dehydration

Woody biomass

Fermentation (Wood – Sugar – Fuel)

• St1 is planning a demo plant to

Kajaani

• No wood based commercial plants

running or under construction

Pyrolysis (Wood – Biocrude)

• KiOR has build the first pyrolytic

plant with upgrading, they ran

out of money and cannot restart

• There are biocrude facilities

without upgrading, eg. Fortum

Gasification (Wood – Syngas – Fuel)

• Projects of UPM and Vapo are cancelled or on hold

• INEOS Bio (fermentation to ethanol) has opened a

demo plant in U.S.

• No other gasification based wood-to-biofuels

commercial plants running or under construction

18

Global advanced biofuel capacities today

0 0,5 1 1,5 2 2,5 3

Renewable diesel (e.g.NEXBTL)

Cellulosic ethanol

Biomethanol

Catalytic pyrolysis

Syngas fermentation

Neste Oil

Others

Mt/a

Advanced biofuels exclude traditional bioethanol and biodiesel

Capacities include commercial and commercial reference plants

Woody

feedstock

Global biofuels investment have a

decreasing trend

• Most of the biofuel

investments have

taken place in the

Americas where

light-duty fleets use

mainly gasoline

instead of diesel

Global investment in biofuels by region $bn

20

Summary Alternative energy solutions for traffic are emerging slowly

• Continuing dominance for ICE (internal combustion engine) based technologies

is forecasted, implying very extensive use of renewable biofuels in traffic

Long term novel feedstock solutions are far away

• A broad range of globally available feedstock is needed

New conversion technologies have challenges to meet commercialization

• Existing second generation technologies, such as NEXBTL, are proven enablers for

fulfilling the biomandate

EU Biofuels policy should

• Keep ambitious biofuel targets (volume / quality) and maintain technology neutrality

• Not allow protectionism to gain ground

• Accept that feedstock are global – just like oil is

Neste Oil provides a strategic agenda striving for renewal

• -> Significant volumes of NExBTL renewable diesel and biojet

• -> Renewable fuel for lowering GHG and urban air emissions

• -> Continuously broadened flexible mix of sustainable feedstock and technologies

21

Increasing use of biofuels – and waste/residue

based feedstock – an opportunity for Finland

Knowhow

Globally active companies in

relevant fields

Strong research and educational

position in crucial areas

Development of

competitive solutions

for reducing GHG

emissions

In transportation, energy

production and chemical

sectors

Feedstock sources

Opportunity to increase the

amount of domestic raw-

materials

Kiitos.

lars-peter.lindfors@nesteoil.com