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BP and Circtec Seal Eight-Year Agreement for Supply of Tire-Derived Fuel and Feedstock
BP and Circtec Seal Eight-Year Agreement for Supply of Tire-Derived Fuel and Feedstock

BP and Circtec Seal Eight-Year Agreement for Supply of Tire-Derived Fuel and Feedstock

  • 06-May-2024 7:18 PM
  • Journalist: Gabreilla Figueroa

BP has entered an eight-year offtake deal with Circtec, a UK technology firm specializing in pioneering pyrolysis chemical processes. Circtec's facilities transform challenging-to-recycle waste tires into HUPATM, Circtec's exclusive renewable marine fuel, and circular naphtha petrochemical feedstock.

As per the agreement, BP pledges to purchase a maximum of 60,000 tonnes annually of HUPATM renewable marine fuel and up to 15,000 tonnes yearly of circular naphtha petrochemical feedstock from Circtec's new large-scale plant. This commitment spans eight years post-commissioning of the plant, operating under a take-or-pay arrangement. The facility, estimated at €285 million in value and scheduled for construction in Delfzijl, The Netherlands, will be equipped to annually process 200,000 tonnes of waste tires into HUPATM renewable marine fuel, circular naphtha petrochemical feedstock, and circular chemical recovered carbon black (rCB). Construction is set to commence this year, with the initial phase expected to be operational by 2025. Furthermore, BP will contribute €12.5 million in debt capital to support the €100 million development of the Delfzijl plant's first phase.

Over the past decade, Circtec has heavily invested in research and development, securing patent protection, and conducting extensive trials with numerous shipping operators to introduce the HUPATM product to the marine transport sector. HUPA comprises a 50% biogenic component, certified to achieve an 87% reduction in greenhouse gas emissions compared to traditional fossil marine fuel. This product, compliant with marine fuels regulations and standards, holds ISCC certification for its significant greenhouse gas reduction impact. It is suitable for use by shipping operators, either as a standalone or blended with fossil marine fuels, to fulfill the requirements mandated by the EU's FuelEU Maritime Regulation and Renewable Energy Directive concerning marine decarbonization.

Commencing next year, European Union regulations will enforce a steadily escalating requirement for the decarbonization of marine transportation, aiming for an 80% reduction in carbon emissions by 2050. Anticipated to stimulate demand, this legislation will prompt shipping companies operating within and beyond European waters to seek out scalable, lower carbon fuel solutions to power their vessels. Circtec stands as the sole global entity capable of producing HUPATM drop-in marine fuel from waste tire feedstock, uniquely positioned to fulfill these European mandates.

The Delfzijl plant represents Circtec's inaugural venture into commercial-scale plant investment following a 15-year period of technology and product development. Circtec has outlined plans to embark on several plant projects globally in the coming years, with initial focus on North America and Southeast Asia. These projects will materialize as either direct owner-operator plants or through collaborative joint-venture licensing partnerships.

In 2021, Circtec announced a significant long-term offtake partnership with Birla Carbon, one of the world's largest producers of carbon black, securing the entire output from the new Delfzijl plant for Circtec's circular chemical product, recovered carbon black (rCB). This supply serves Birla Carbon's flagship decarbonization product line, ContinuaTM SCM.

The processing capacity of the Circtec Delfzijl plant is expected to handle approximately 6% of Europe's annual waste tire volume. Currently, over 50% of European waste tires are either incinerated in cement plants or exported to Asia for disposal. According to an ISO-standard Life Cycle Assessment of the Circtec plant investment, it is anticipated to reduce greenhouse gas emissions by approximately 3% of the national emissions from the Netherlands' chemical industry sector once the plant is fully operational.

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