Graincorp and Cargill are both planning crushing plants in WA, but BP's move to defer its biorefinery has raised questions about the industry.
Cargill has deflected questions about the viability of its oilseed crushing project in the wake of BP’s decision to ice its Kwinana biorefinery.
BP in February deferred its 580-million-litre refinery, citing financing and government policy as reasons for the decision.
As plans for the refinery progressed in recent years US agribusiness Cargill and east coast commodity trader GrainCorp each put forward plans for oilseed crushing plants in WA.
Both plants were understood to be worth more than $500 million, with Cargill working towards supply and offtake deals with CBH and BP and securing a two-year Rockingham site lease in October last year.
BP’s biorefinery was understood to be a critical piece of infrastructure to enable oilseed crushing capacity in Western Australia as an offtake customer.
The critical need for such a facility to underpin investment in a local biofuels industry was highlighted at last year’s Evoke Ag conference in Perth.
Business News asked Cargill if BP’s move had impacted on the viability of its project.
Cargill did not respond to that question, but did confirm planning had not ceased.
“Cargill continue to work through the project planning approvals and have an option on the required land,” a Cargill spokesperson said.
“The BP announcement further demonstrates the importance of policy clarity and support for the emerging biofuel industry that is critical in Australians decarbonization journey.”
GrainCorp meanwhile has confirmed to Business News’ its planned facility was not impacted by BP’s decision.
The ASX-listed business is considering Western Australia among several states for a 750,000 to 1 million-tonne-per-year oilseed crushing plant.
A GrainCorp spokesperson said that plant was geared toward a preliminary agreement to supply Ampol’s proposed renewable fuel refinery in Brisbane.
WA’s nascent biofuels sector has been waiting on stronger policy support from state and federal government to encourage investment in what the Australian Renewable Energy Agency said could become a $10bn industry by 2030.
Currently, the sector in WA is defined by small refineries operated by the likes BioWorks Australia in Henderson and the Ashburton Aboriginal Corporation in Tom Price.
Qantas, Inpex, and ANZ are three years into a feasibility study growing mallee trees for biofuel in the Wheatbelt.
Rio Tinto is importing renewable fuel for a trial in its mining fleet and funding a 3,000-hectare test crop near Townsville.
Perth firm Renewable.bio is the closest company to getting a new biorefinery up and running in Western Australia.
The biomass exporter is stockpiling feed for its $500m, 60-million-litre project in Esperance, which it hopes will be operational in 2027.
A final investment decision on that plant is imminent.
ARENA on Tuesday outlaid $10.4 million for two sustainable aviation fuel projects, a blending project backed by Viva Energy in Brisbane and another by Licella in Bundaberg to probe the use of sugarcane residue for fuel.
