October 3 , 2022 [Houston Chronicle] – Preparations are underway at the site of Shell’s former Convent refinery in Louisiana, where the oil major plans to build a $1.48 billion low-carbon fuels facility.
The project’s first phase would include a renewable fuels unit that would produce renewable diesel and sustainable aviation fuel from plant oils, animal fats and used cooking oils. The company said it is close to reaching a final investment decision, a precursor to construction, on that project.
The plan to repurpose Convent, northwest of New Orleans, is the first in a series of projects Shell is considering at its chemicals facilities along the Gulf Coast to accelerate the transition from fossil fuels. The regional spending plan, which is still in flux, could cost as much as $10 billion.
The company is also considering new projects at facilities in Deer Park, east of Houston, and Geismar and Norco in Lousiana to help the company reduce emissions and provide reduced-carbon products and chemicals needed to advance the energy transition.
“It’s a very significant investment in the region,” said Emma Lewis, Shell’s senior vice president of Gulf Coast chemicals and products. “If you looked at Louisiana, and you thought about it as a country, it would be No. 3 or 4 in the Shell portfolio. Between the Gulf of Mexico offshore assets and chemicals and products, onshore assets, it’s a hugely important place for Shell, not just in terms of our earnings today, but also in the future.”
Shell is prioritizing projects in the region based on the low-carbon products that are most in demand, Lewis said, which now include biodiesel and sustainable aviation fuel. Shell is one of the main suppliers of traditional aviation fuel, so it has strong relationships with airlines, she said.
Hydrogen is already in demand as a transportation fuel, she said, so the company is considering producing it at the Convent site.
The Norco plant, meanwhile, will continue to produce traditional gasoline and distillate fuels powering the industry today.
“All of our customers are in very different places in this transition,” Lewis said. “Some of them already want low-carbon or circular products today. Some of them only want low-carbon and circular products in some of their consumer goods, and some of them aren’t really ready to make that switch.”
The Geismar facility and the Deer Park facility would make chemicals needed during the energy transition, Lewis said. Geismar, for example, would make low-carbon detergents and chemicals used in the production of batteries for electric vehicles.
The company also is evaluating how to recycle butadiene, a chemical used to make car tires, so it can support tire-makers that promise to deliver new products made from recycled materials.
Shell plans to start building the low-carbon fuels project first, followed closely by the hydrogen and carbon-capture projects.
The company has already begun demolishing parts of the former Convent refinery it won’t need. In its current state, the site stands apart from the others, Lewis said.
“It’s very quiet,” she said. “You can hear the birds singing, the flies buzzing and the crickets chirping, which is so weird to be on a unit like that. But it’s really exciting just because you can envision what it could become.”
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