In March 2020, Neste announced its intention to increase its production capacity for renewable products in Europe. The company has now completed a thorough study of the two possible locations: Porvoo and Rotterdam. Neste already has facilities in both locations. Both locations also have a large number of positive factors, but the difference in costs weighs significantly in favour of Rotterdam.
“Based on the thorough studies and calculations, the total investment costs appear to be significantly lower in Rotterdam,” says Peter Vanacker, President and CEO of Neste. “Our decision is based on securing our future competitive position and executing the growth strategy for our renewable products.”
The criteria for location selection include current markets and the regulatory framework that supports market growth, raw material sourcing opportunities, investment and operating costs, infrastructure and low-carbon utilities as well as local synergies and incentives.
The main aspects contributing to the difference in total costs are logistics costs, site-specific construction costs and availability of low-carbon hydrogen facilities. Rotterdam scores well in this respect. Also, the location in Porvoo is more complex, which leads to a higher execution risk and a longer construction time. Rotterdam benefits from the proximity of new markets for Neste’s Renewable Aviation and Renewable Polymers and Chemicals activities, as well as the proximity of feedstock sources.
Neste will make the final investment decision around the end of 2021 or the beginning of 2022. Finland is, and will remain, the company’s centre for research, development and innovation.
Image: Neste
