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Vopak expects clean energy investment to increase by 2030, says CEO

Posted on by L. Dreeye
Vopak expects clean energy investment to increase by 2030, says CEO

  • Less than $100 million of the $1 billion promised to be invested by 2030 has been spent
  • Project implementation is slowing due to lack of government mandates and higher costs
  • Seeks to capture a larger share of the biofuel market
SINGAPORE, Nov 1 (Reuters) – Global tank storage operator Vopak (VOPA.AS)opens a new tab The company has committed only a portion of $1 billion to energy transition projects by 2030, but expects investments to increase by the end of the decade, said CEO Dick Richel.

The company has spent just under $100 million on projects in the two years since it announced the spending, Richelle told Reuters.

“Even though things have slowed down, we still see it moving away from a lot of hype and dreams to a lot more realism in building these new supply chains in the future,” he said.

Some of the factors slowing down projects include a lack of government mandates and incentives, higher costs of producing alternative fuels and rising capital costs for construction, he added.

For example, the Norwegian Equinor (EQNR.OL).opens a new tab Repsol (REP.MC) has abandoned plans to export hydrogen to Germany because it is too expensive and not in demand enough.opens a new tab suspended hydrogen projects in Spain due to an unfavorable regulatory environment.

“You need all these parties holding hands and jumping around at the same time to make sure you can create a whole supply chain,” Richel said.

“I think it’s been slow simply because it’s either unclear what incentive you’ll get to produce, or unclear what the mandate is and where you want to sell your product, or what the incentive is. to import the product.”

Looking to the future, Vopak will focus on infrastructure projects in four areas of the energy transition: biofuels and feedstocks such as clean aviation fuel and renewable diesel; hydrogen and hydrogen carriers such as ammonia; carbon dioxide (CO2) supply chains and costs; and battery storage.

Vopak plans to capture a larger share of the biofuel market by converting existing biofuel storage tanks in Rotterdam and Singapore, and by using biofuel as feedstock for fuel and petrochemical production in India, Brazil and Los Angeles, Richelle. said.

For ammonia, Vopak is targeting major production hubs such as the Middle East and the US, as well as end markets such as Antwerp, Rotterdam, Singapore and South Korea, where the company has terminals, he added. In July, the company said it had opened an office in Japan to explore opportunities there.

Vopak also has a strong presence in China, a competitive producer of green methanol, where it can facilitate the production and distribution of alternative fuels, Richelle said.

In carbon storage, the company is working on a project in Rotterdam and has an initial agreement with Australia’s Northern Territory to build a CO2 import terminal.

Vopak is also taking its first steps into investing in battery storage, announcing a project in Texas earlier this year, Richelle said.

“We see Vopak potentially playing an important role as the world moves from molecular storage to electron storage,” he said.

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Reporting by Florence Tan and Jeslyn Lehr; Editing by Jamie Freed

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