A new partnership between VARO Energy and Orim Energy aims to support the decarbonisation of maritime transportation and inland shipping in Northern Europe by supplying biofuels to customers in the Port of Rotterdam and the Amsterdam-Rotterdam-Antwerp (ARA) region.
The agreement, announced on 21 February 2024, is aligned with the targets set by the International Maritime Organization (IMO) to reduce the total annual greenhouse gas (GHG) emissions from shipping by at least 20% by 2030 and at least 70% by 2050, compared with 2008 levels. It also responds to the growing demand for blended biofuels, driven by new EU regulations, such as the FuelEU Maritime initiative, which aims to limit the carbon intensity of the energy used on board ships.
Biofuels are fuels derived from renewable sources, such as vegetable oils, animal fats, waste oils, and biomass. They can offer significant reductions in GHG emissions and other pollutants, depending on the feedstock and the production process. Some biofuels, such as hydrotreated vegetable oil (HVO) and advanced biofuels, can be used as drop-in fuels, meaning that they can be blended with conventional fossil fuels without requiring modifications to the existing infrastructure or engines.
VARO and Orim have complementary capabilities that will enable them to provide high-quality biofuel blends to their shipping customers. VARO, a leading integrated fuel supply company in North West Europe, has significant biofuels trading capabilities and a growing biofuel manufacturing asset base. Orim, a leading independent physical supplier of marine fuels and lubricants in the ARA region, has extensive distribution, storage and bunkering capabilities.
Under the agreement, VARO will source, produce and blend various waste and advanced bio feedstocks to high quality bunker specifications. Orim will source the fuel and gas oils for blending and deliver the final biofuel blends to customers’ vessels.
The partnership will focus on supplying B30, a blend of 70% fuel oil and 30% biofuels, which is expected to become the most popular biofuel blend in the ARA region by the end of the decade. The current demand for fuel oil in ARA, Europe’s largest bunkering hub, is approximately 14 million tonnes per year. According to a study by EMSA, the European Maritime Safety Agency, the potential demand for B30 in ARA could reach up to 4.2 million tonnes per year by 2030, depending on the price and availability of biofuels.
The partnership will also leverage VARO’s experience in providing 100% biofuels for maritime logistics. Since 2018, VARO has supplied the Port of Rotterdam with HVO100, a 100% HVO fuel, for use with the Port’s service fleet. In 2023, VARO signed an agreement with Höegh Autoliners, a leading global provider of Ro/Ro vehicle transportation services, to supply the company with 100% advanced biofuels for its shipping fleet.
Dev Sanyal, CEO of VARO, said: “Meeting rising demand for blended biofuels is critical to achieving the EU and IMO’s decarbonisation targets for shipping. Our experience in biofuels, combined with Orim’s logistics and bunkering operations, will help meet this demand at Rotterdam, Europe’s largest port facility.”
Edwin Coppens, Managing Director of Orim, said: “Upcoming EU and IMO regulations drive the need to scale up with biofuels and ensure quality assurance going forward. Partnering with VARO allows us to do just that, using each other’s strengths to optimize our blending expertise and network. We will benefit from VARO’s extensive experience with biofuels, which includes joint testing with leading ship engine suppliers.”
The partnership between VARO and Orim is a promising step towards leveraging biofuels as a sustainable and cost-effective solution for the decarbonisation of the maritime sector in Europe.
