The global co-refining market is set to undergo significant expansion as the energy sector shifts toward a low-carbon future. Valued at US$ 39.7 billion in 2023, the market is projected to grow at a CAGR of 6.0% and reach US$ 73.0 billion by 2034. This press release provides a comprehensive analysis of the market’s evolution, highlighting the transition to renewable feedstocks, the integration of advanced refining processes, and the dynamic regional and competitive landscape driving growth.
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Market Overview and the Role of Co-refining
Co-refining, also known as co-processing, is an innovative approach employed in the oil & gas sector to produce diverse fuels by processing various feedstocks alongside crude oil. These feedstocks include animal fats, used cooking oils, vegetable oils, biomass, waste plastics, and other bio-based materials. Co-refining is pivotal in manufacturing transportation fuels and petrochemical feedstocks and employs several key processes:
- Hydroprocessing: Upgrades bio-crude oil into transportation fuels.
- Catalytic Cracking: Enhances the production of aviation fuels with lower energy consumption.
- Fluid Catalytic Cracking (FCC): Converts high-boiling fractions of crude oil into valuable products like gasoline and olefinic gases.
- Hydrotreating & Hydrocracking: Remove contaminants and reduce molecular weights to maximize fuel yields.
These processes enable existing refineries to incorporate renewable feedstocks and produce advanced biofuels, facilitating the transition toward a low-carbon economy.
Key Drivers and Industry Trends
Rise in Transition Toward a Low-Carbon Economy
- Global Energy Shift: Fossil refineries are under pressure as the world moves to limit warming to 1.5° C and achieve net zero GHG emissions.
- Infrastructure Adaptation: Refineries are increasingly integrating renewable hydrogen, sustainable biofuels, and Carbon Capture and Storage (CCS)/Utilization (CCU) technologies.
- Government Initiatives: In May 2024, the European Commission awarded nearly €720 million to renewable hydrogen projects, while the U.S. DOE launched a US$7 billion initiative for regional “hydrogen hubs.”
Increase in Adoption of Biofuels
- Enhanced Fuel Security: Co-refining biomass-derived feedstocks with petroleum fractions offers a practical pathway for producing advanced biofuels, thereby reducing the carbon footprint of transportation.
- Investment Surge: According to the International Energy Agency (IEA), biofuel investments reached a decade-high in 2022, driven by increased capacity additions and the urgent need to decarbonize hard-to-abate sectors.
Regional Outlook and Competitive Landscape
Leading Region: Europe
Europe held the largest share of the co-refining market in 2023, driven by:
- Rapid Scale-Up of Biofuels: The urgent need to meet climate mitigation targets in the transport sector is spurring investments in biofuel production.
- Regulatory Support: The EU’s focus on reducing greenhouse gas emissions—with initiatives like the Horizon Europe project COREu launched by SINTEF—bolsters the co-refining market.
- Infrastructure Readiness: Mature refining infrastructure and significant investments in CCS technologies contribute to Europe’s leadership in this market.
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Competitive Landscape and Key Players
Key industry players are adopting advanced co-processing techniques, particularly for Sustainable Aviation Fuel (SAF) production, using existing refinery infrastructures. Prominent companies include:
- Bharat Petroleum Corporation Limited
- China National Petroleum Corporation
- ExxonMobil Corporation
- Saudi Arabian Oil Co.
- Valero Energy Corporation
- Marathon Petroleum Corporation
- ROSNEFT
- Petroleos de Venezuela S.A.
Notable Market Developments
- April 2024: Meridian Energy Group Inc. announced that its proposed greenfield oil refinery in Belfield, North Dakota, will have the capability to co-process up to 4,000 barrels per day of vegetable oil.
- 2023: Saudi Aramco TotalEnergies Refinery & Petrochemicals Co. (Satorp) successfully completed the production of Sustainable Aviation Fuel (SAF) from the co-processing of used cooking oil at its 460,000 b/d full-conversion refinery complex in Jubail, Saudi Arabia.
Market Segmentation Includes:
- By Feedstock Type
- Crude Oil Co-refining
- Biomass Co-refining
- Waste Plastic Co-refining
- Renewable Feedstock Co-refining
- By Processes
- Hydroprocessing
- Catalytic Cracking
- Fluid Catalytic Cracking (FCC)
- Hydrotreating
- Hydrocracking
- Others
- By Product
- Fame Biodiesel
- Bioethanol
- Hydrogenated Vegetable Oil (HVO)
- Others
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