Spanish refiner Cepsa, owned by Abu Dhabi's sovereign wealth fund, has announced a broad strategy for clean energy, as European oil companies race to find new fuel sources.
Madrid-based Cepsa said it will focus on developing the energy required for heavy transport and industries, in a bid to differentiate itself from its peers from other European oil companies, which have announced similar transformation plans.
An agreement between Dussur and a Chinese company to manufacture hydrogen-powered buses in Jeddah
This includes providing green hydrogen and biofuels to trucks, cargo ships, airlines, and other industries, according to company CEO Martin Wetzelaer.
carbon removal
“We decided to take on the toughest challenge to decarbonise. The solutions are not as clear in heavy industries and transportation,” Wetzlar said during a strategy presentation, on Wednesday, in Madrid.
According to what the CEO of Cepsa said, the company aims to produce 2 gigawatts of green hydrogen by 2030, in addition to 2.5 million tons of non-food-based biofuels.
Saudi Arabia begins construction of a green hydrogen plant in NEOM this month
The bet on hydrogen and other biofuels is risky, as both fuel categories are not widely used.
Yet the Ukraine war, which has upended energy policy across Europe, is pushing governments and companies to develop new sources and accelerating the energy transition. The increasing focus on energy security also opens the door to new initiatives, such as those identified by Cepsa.
Focus on Spain
Wetzellar (Dutch, aged 35 years) joined Cepsa in early January from Shell, where he headed the Gas and New Energies division, spearheading the company's drive towards clean energy.
The CEO hopes to build the largest network of hydrogen filling stations on the Iberian Peninsula over the next 8 years, and the scheme includes 100 sites.
Witselaar also sees an opportunity for Spain to become an inspiration by embracing the main European hub for the hydrogen industry.
Infographic: $300 billion investments in clean hydrogen until 2030
One of the reasons Cepsa is betting on Spain is that the southern region of Andalusia has the cheapest solar energy production in Europe, which can be used to make green hydrogen, according to Weitzellar. The company will also develop plants to produce renewable energy, mainly to support its own consumption.
To reach its goals in 2030, Cepsa is seeking to invest between 7 and 8 billion euros (about 7.8 to 8.9 billion dollars).
The company said that sustainable energy will make up the majority of its profits by the end of the decade, while fossil fuels currently represent the largest proportion.
As part of its strategy, the company aims to reduce its carbon footprint. It will also retain its chemical unit, which will shift to a cleaner approach, while its exploration and production division will seek to grow and self-finance.
It is worth noting that Cepsa is owned by Mubadala Investment Company and the Carlyle Group.
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