From NOT A LOT OF PEOPLE KNOW THAT
By Paul Homewood
There is no viable commercial market for biofuels. It only survives because of government subsidies and diktat.
LONDON (Reuters) -Shell will pause construction work at one of Europe’s largest biofuel plants due to weak market conditions, the latest low-carbon project to suffer a setback as CEO Wael Sawan is striving to boost returns.
It is rare for companies to suspend development of projects underway. Rival BP last week said it is pausing two biofuel projects in Germany and the United States.
Under Sawan, who took office in January 2023, Shell has scrapped and sold renewable and hydrogen projects, retreated from European and Chinese power markets and sold refineries in order to focus on the most profitable operations, primarily in oil and gas.
Shell shares have gained over 11% so far this year.
Shell gave the greenlight for the development of the 820,000-ton-a-year plant in the Netherlands in September 2021 which was originally planned to start production in 2025. The project is now expected to go online towards the end of the decade.
The facility at its chemicals park in Rotterdam was slated to produce sustainable aviation fuel and renewable diesel made from waste.
Shell said in a statement that following the decision to pause construction, “contractor numbers will reduce on site and activity will slow down, helping to control costs and optimise project sequencing.”
UBS analyst Joshua Stone said that the pause was consistent with Shell’s strategy to focus on returns
“The delays further highlight that the advanced biofuels market is not an easy one. The oil majors have dipped their toes and found it challenging,” Stone said.
Shell will also consider an impairment for the project and will provide further details in its quarterly trading update on Friday, it said.
“Temporarily pausing on-site construction now will allow us to assess the most commercial way forward for the project,” Shell’s downstream head Huibert Vigeveno said in a statement.
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It only survives because of government subsidies and diktat.
Sorta like wind turbines, grid solar and EVs.
The swing back to common sense rather than fantasy energy is creating sovereign risk for any project depending on robbing consumers through government mandates.
Electricity retailers are the bagmen in Australia with the job of taking money from consumers to pay weather dependent generators so they can be profitable. Remove the theft and none of them is viable.
Rooftops in Australia have created a nightmare for grid scale subsidy farmers. All these weather dependent generators are after a slice of the lunchtime market.
RickWill,
How do you make your words read with such authority, as if you had been there and done that? In contrast to our Prime Minister , Energy Minister and many other Ministers who have not done much outside of union organisation, that has little to do with the engineering and economics of national electricity?
Geoff S
Sherro, I think Rick is referring to the grift. Its as plain as the…… whatever
Well it looks like the Oil and Gas majors have finally realised they have to stop making and freely giving the metaphoric bullets the Green warriors then use to constantly fire at them.
BP are also finally getting back to the core job of wealth creation that investors i.e. pension funds want them to concentrate on.
If the Greens are so convinced about their position then let them fund their own green projects. No state funding no forced coercion of public via legislation. Let them build the markets they say will be so low cost so beneficial the public will be grateful they are there. As always the public will ultimately use their market awareness i.e. cost to decide if they want bio diesel or oil refined diesel.
The market will ultimately decide. The constant nudging and redirecting by government agents will always be with us but in the end it all comes down to economics and wealth creation.
I think the reality is that oil and gas companies do not want to get hammered by all kinds of restrictions and bad press and would very much like to have a seat at the decision table. Some actually DO believe in the transition (BP= beyond petroleum). I dont think it was just an exercise in virtue signalling. But times change and real doubt has crept in which has led to increasing scepticism about green energy. Old style oil men already crunched the numbers and knew green could never compete and also went along w green knowing full well reality would kick in.
A free market, aka supply and demand, is the purest form of democracy.
You can’t fix stupid … and you can’t sell it either.
I agree you cannot fix it, but there are times when you can sell it, if only for a limited period. Anything more is where faith comes in.
I disagree Eric.
Stupid is consistently a top-seller.
And it doesn’t even need to be “on special”.
Politics and subsidies make stupid a best seller. Stupid buyers are the problem. Everything depends on good education.
Everything depends upon Awareness and Common Sense. “good education” takes too darned long.
Battery making isn’t doing too well in Europe either:
Battery maker Northvolt may scale back expansion after setbacks
https://www.thetimes.com/article/75a901bc-c5fa-4afe-9aa6-35bc94d37f9d?shareToken=f7c380258fa0139cd0ad7b6034f59536
Renewable… making the same stupid mistake every time.
Just because million dollar trucks can run on crap fuel doesn’t mean it is a good idea.
Cooking oil, every batch is different. How do you dial in a refinery to handle this. Intermittent energy meet intermittent quality.
I’d think that cooking oil is rather dirty.
So is unrefined oil.
So cooking oil would have to go through a similar refining? Yes- of course- and it must be expensive.
That %#$*&* oil!
What is the real benefit of biofuels? They too contain a lot of Carbon. It’s another offset of sorts…
“””In theory, biofuels can be a “carbon-neutral”””
When the plants used to make biofuels grow, they absorb CO2 from the air, and it’s that same CO2 that goes back into the atmosphere when the fuels are burned.
https://climate.mit.edu/explainers/biofuel
If i had a sixpence for every one of their failed theories, I’d be a rich man.
Isn’t that the same argument in favor of coal? Or oil for that matter.
There is more than one order of magnitude between 100 years and 1,000,000 years.
How about cattle and methane?
It’s the same. It is in equilibrium.
Preconceived notions are not helpful and there are a couple of classic examples of this in interplanetary exploration. Probes have have shown that atmospheric carbon dioxide levels on Venus (96.5%) and Mars (96.0%) could not have been caused by the burning of ‘fossil’ fuels.
Furthermore, we must ask: just how prevalent is atmospheric methane in our solar system?
Earth …….. 0.0002 ppm
Jupiter ….. 3,000 ppm
Saturn ..… 4,000 ppm
Uranus …. 23,000 ppm
Neptune .. 15,000 ppm
Saturn’s moon, Titan, hosts gigantic lakes brimming with liquid methane, constantly replenished by methane rain. Methane is not a ‘fossil fuel’. What’s the point of the NASA space program if its results are simply ignored?
It only survives because of government subsidies and diktat. Just like electric cars then.
it only survives because the government steals money from the working class citizens by diktat and shares that with the private sector grifters.
there fixed that
What took you so long? At what point did the ROI inform you that this isn’t working out?
The ‘tell’ here is an offhand remark about impairment, meaning a write-off on the books, then layering over it with half-hearted new directions for proj. This is another dead green puppy in the chain.
Get the government out of the way and these renewable projects will all die on the vine.
Aye, there’s the rub.
The real cost for these biofuels is $10 to $20 per gallon. There is no way that they can compete with gasoline and diesel at $3 to $4 per gallon without extreme government subsidies. Somebody just crunched the numbers and got cold feet.