TOFTE, Norway (News release) -- Södra and Statkraft have made a decision to invest in a new demo facility for fossil-free fuel.

The investment will be made through the joint company Silva Green Fuel AS, in partnership with technology provider Steeper Energy Aps and Norwegian financing partner Enova. The total investment will be approximately SEK 500 million. The biofuel will be based on forest raw material and the demo facility is expected to be in operation by spring 2019.

The demo facility will be located in Tofte, Norway, and project planning will commence in the winter. Start-up is planned for spring 2019, with a capacity of about 4,000 litres per day. The raw material will consist of residual products from the forest industry.

"This is a milestone decision. The forest offers enormous potential when it comes to finding new and sustainable solutions for products that were previously confined to fossil raw material. Södra has expert knowledge in forests and industrial processes to extract high-quality products from forest raw material, while Statkraft is specialised in energy. This is a strong combination," said Catrin Gustavsson, Head of Innovation and New Business at Södra.

The demo facility is a first step towards a full-scale facility. It will be used to develop both the process and the technology for producing the new biofuel. In the next stage, the plan is to establish a full-scale facility, with biofuel production for various types of transport, including road and air.

"With a commercial facility in place in the future, we can enable large volumes of biofuel. At the same time, any future decisions regarding the EU's Renewable Energy Directive - on how energy from renewable sources should be promoted - must support these types of investment in biofuel production. Södra is following several paths for the development of biofuel, in particular, and this represents another step forward towards a fossil-free future," said Christen Grønvold-Hansen, Project Director for the demo facility at Södra.

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