<article><p class="lead">Final investment decision (FID) for the development of a $7.7bn biorefinery project in Panama to produce advanced biofuels is scheduled for the fourth quarter of next year. </p><p>The Golden City biorefinery project will operate on a zero-waste ecosystem strategy, chief executive of US integrated bioenergy products development company SGP Bioenergy, Randy Delbert Letang, told <i>Argus</i>. </p><p>The biorefinery will use non-narcotic industrial hemp oil as feedstock as well as other fats and greases to produce advanced biofuels using a process technology from Danish company Topsoe.</p><p>The plant is expected to have a capacity of 180,000 b/d and will mostly produce sustainable aviation fuels (SAF), renewable diesel and green marine diesel. </p><p>Some by-products produced at the plant will include green naphtha, which will then be used to produce secondary products such as green hydrogen. The company is targeting around 405,000 t/yr of the fuel once the project is completed.</p><p>Green hydrogen could be used at a later stage to produce tertiary products such as e-kerosene or green ammonia, but the company's decision to go ahead with the production of these fuels will depend on demand from the market, according to Letang.</p><p>The main objective of the project is to reuse every by-product produced as much as possible to minimize waste. "We'll utilize the by-product of each product we'll be making until we expire as much of the CO2 in the product as possible," Letang said. "You are going to have some sort of carbon waste but our goal is to use that [carbon] waste as much as possible with existing technologies to produce other products. This is the closest path to net zero," he added.</p><p>The plant will be developed in three phases of 60,000 b/d of capacity each. The first phase is estimated to be completed in the first quarter of 2027. The following phases will be completed within 15-18 months each.</p><p>The total cost of the project is $7.7bn but the company is focusing on attracting financing for the first phase that will cost around $3.1bn. The firm recently announced a $250mn equity commitment from Global Emerging Markets (GEM), a European private alternative investment group. SGP hopes to secure more investment from private capital, private equity funds and standard development institutions.</p><p>Although SGP has not yet signed any supply agreement with customers for the fuels, it has received interest from prospective clients, Letang said. Sovereigns and large original equipment manufacturers are the main target. </p><p>"Under the Paris Climate Agreement, and more recently, the Global Biofuels Alliance promoted by India, it is the sovereigns who have made the commitments to the energy transition," he said. "They also possess the creditworthiness and ability to uptake significantly larger volumes than individual companies for their industries."</p><p>On the feedstock side, SGP most recently signed an agreement with the Latino Farmers and Ranchers International (LFRI) organization to grow and supply 10mn acres of industrial hemp in 10 years.</p><h3>Financial viability</h3><p class="lead">The ability that the company has to obtain revenue through the entire supply chain, combined with the leverage of existing infrastructure, makes the project economically viable, according to Letang. </p><p>"Our goal is to drive down the cost of [sustainable] fuels for the end customers as close to parity as possible to their potential conventional petroleum counterpart," he said. "We are looking to accelerate the velocity of adoption [of sustainable fuels] in the market place."</p><p>On top of that, political and economic stability, combined with the use of the US dollar and the ability to operate within existing logistics and infrastructure with access to over 1,900 ports, will allow the firm to reach the global market for exports. </p><p>"Having the advantage of the Panama Canal, ports and channels, allows us to execute the logistics more efficiently," he said.</p><p class="bylines">By Jacqueline Echevarria</p><p><table class='tbl-excel'><tr><td class='tbl-header' colspan='2'>SGP Golden City biorefinery project</td><td class='tbl-header tbl-right tbl-italic'></td></tr><tr><td class='tbl-columnheader tbl-bold tbl-left'>Phase</td><td class='tbl-columnheader tbl-bold tbl-right'>Capacity b/d</td><td class='tbl-columnheader tbl-bold tbl-right'>Commissioning date</td></tr><tr><td class='tbl-left'></td><td class='tbl-right'></td><td class='tbl-right'></td></tr><tr><td class='tbl-left'>1</td><td class='tbl-right'>60,000</td><td class='tbl-right'>2027</td></tr><tr><td class='tbl-left'>2</td><td class='tbl-right'>60,000</td><td class='tbl-right'>To be determined</td></tr><tr><td class='tbl-left'>3</td><td class='tbl-right'>60,000</td><td class='tbl-right'>To be determined</td></tr><tr><td class='tbl-footer tbl-right tbl-italic' colspan='3'>— SGP Bioenergy</td></tr></table></article>