North America to Dominate Renewable Refinery Capacity Additions

North America will dominate global renewable refinery capacity additions through 2027.

That’s according to a new release from GlobalData sent to Rigzone last week, which outlined that the company’s latest report shows that North America is expected to witness a renewable refinery production capacity of 13,142 million gallons per year (mmgy) in 2027, “followed by Europe and Asia with 3,882 mmgy and 3,522 mmgy, respectively”.

The U.S. is expected to witness the highest renewable refinery production capacity additions in North America, as well as globally, with 8,987 mmgy capacity expected to be added by 2027 from several planned and announced projects, GlobalData noted in the release.

Panama, Canada, and the Netherlands are the other “key countries” where “considerable” renewable refinery production capacity additions are expected to take place through 2027, the company added. Panama is anticipated to see 1,733 mmgy of capacity additions, while Canada is expected to see 1,347 mmgy, and the Netherlands is expected to see 872 mmgy, GlobalData pointed out.

In the release, GlobalData stated that, globally, the consumption of renewable fuels is increasing amid growing environmental concerns about the usage of fossil fuels and government policies supporting renewable fuels.

“As a result, global renewable refinery capacity additions are growing rapidly,” the company added.

“Many countries are focusing on carbon emission reduction initiatives as part of their net-zero emission targets” Bhargavi Gandham, an Oil and Gas Analyst at GlobalData, said in the release.

“Consequently, the global demand for renewable refinery fuels such as sustainable aviation fuel (SAF) and renewable diesel is on the rise. This escalating demand has prompted significant capacity expansions, particularly in regions such as North America, Asia, and Europe,” Gandham added.

“Global renewable refinery capacity additions are mainly expected to occur through standalone renewable refineries (63 percent) during the 2023–27 outlook period,” Gandham continued.

“Capacity additions from refinery co-processing and refinery conversion will account for 24 percent and 13 percent, respectively during the forecast period,” the GlobalData analyst went on to state.

In a previous release sent to Rigzone back in August, GlobalData stated that North America will continue to dominate global LNG liquefaction capacity additions through 2027.

The company highlighted in that release that the region will contribute around 59 percent of the total capacity additions between this year and 2027.

“The U.S. will primarily drive the LNG liquefaction additions in North America through 2027, accounting for nearly 80 percent of the region’s total capacity additions by 2027,” GlobalData Analyst Himani Pant Pandey said in that release.

In a separate release sent to Rigzone on September 21, GlobalData highlighted that India will dominate upcoming crude oil refinery projects in Asia through 2027.

“India is set to dominate the new build and expansion refinery projects in Asia, accounting for 45 percent of the upcoming crude oil refinery projects starts in the region between 2023 and 2027, fueled by rising demand for petroleum products,” the company noted in that release.

GlobalData outlined in the release that one of its recent reports revealed that “out of the 81 refinery projects to commence operations in India during the period, two are expected to be new build projects and the rest are expansions of existing projects”.

“In India, 35 upcoming refinery projects are in the construction stage and are likely to start operations between 2023 and 2027. While another 32 projects are in the approval stage, 11 projects are in the commissioning phase,” the company added.

In that release, Gandham said, “India, being one of the leading consumers of petroleum products, is expanding its refining capacity to effectively meet the growing demand”.

“The consumption of petroleum products in the country grew annually by about 10 percent for the financial year ending March 2023,” Gandham added.

“The surge in demand for petroleum products was driven by rapid industrialization, infrastructure development, increased vehicle sales, and economic expansion,” Gandham continued.

GlobalData highlighted in this release that the “major” expansion projects that are expected to start operations in India by 2027 are the Vadinar CDU Expansion, Panipat CDU Expansion, and Paradip CDU Expansion developments.

“The Vadinar CDU Expansion has a capacity of 515,0000 barrels per day and is expected to become operational in 2024. Nayara Energy Ltd is the operator of the project, while Rosneft Oil Co and Kesani Enterprises Co Ltd hold 49.13 percent of equity each,” the company stated in the release.

“The Paradip CDU Expansion and the Panipat CDU Expansion project stand second with a CDU capacity of 200,000 barrels per day each. Indian Oil Corp Ltd is the operator and 100 percent equity holder of both projects,” it added.

To contact the author, email andreas.exarheas@rigzone.com