UK oil major BP [BP:LN] has received approval from Western Australia’s Environmental Protection Authority to repurpose its Kwinana refinery south of Perth as a biofuel production factory, as reported by the Financial Times on January 5. The project involves using natural products such as vegetable oils, animal fats, and other biowaste for fuel production. BP describes this biofuel conversion project as “unprecedented” and has launched a multibillion-dollar investment in sustainable fuel alternatives. According to BP’s plan, the Kwinana refinery is expected to start producing sustainable aviation fuel (SAF) and biodiesel by 2026.

Kwinana is one of five biofuel projects that BP has planned globally, which in total are anticipated to produce 50,000 barrels of SAF and hydrogen vegetable oil (HVO) per day by 2030. The oil giant looks to repurpose its existing refining infrastructure to produce biofuels, which can be used to support the decarbonization of aviation and heavy industries. Notably, despite BP’s large investments in clean fuel alternatives, oil production remains a significant focus for the company. In the third quarter of 2023, BP spent USD222m on developing low-carbon energy but allocated USD1.6bn for oil and gas. In addition, other oil majors have also branched out in the biofuels sector. Last year, ExxonMobil’s [XOM:US] Canadian affiliate Imperial Oil [IMO:CN] announced a USD560m investment to build the largest renewable diesel facility in Canada, with a planned capacity of producing up to 20,000 barrels of renewable diesel per day from 2025.

Sources:

https://www.ft.com/content/18bc37e2-0a9b-47e9-81d9-1f2ad15ff045

https://www.bp.com/en_au/australia/home/media/press-releases/biorefinery-plans-new-milestone.html

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