Spanish oil and gas company Cepsa has entered into an agreement with PreZero Spain, a division of Germany's Schwarz Group, to collaborate on developing biomethane plants using organic waste. Owned by Abu Dhabi's Mubadala and the Carlyle Group, Cepsa plans to invest up to 8 billion euros ($8.6 billion) by 2030 to transition its business towards low-carbon fuels, including green hydrogen and biofuels.
According to a joint statement released on Tuesday, the partnership aims to establish plants capable of producing biomethane from organic waste. The initial facility, expected to generate up to 100 gigawatt-hours (GWh), will supply Cepsa's forthcoming green hydrogen and biofuels facilities near Huelva, southern Spain.
Under the agreement, PreZero will also supply biomethane to Cepsa, supporting efforts to recover organic waste for biofuel production and other initiatives. Carlos Barrasa, Cepsa's executive vice president of commercial & clean energies, emphasized the strategic significance of the alliance: “This alliance with PreZero will allow us to expand access to circular raw materials to produce alternative energies that will facilitate the energy transition, such as green hydrogen and second-generation biofuels.”
Biofuels, particularly second-generation types derived from non-food organic sources like wood and agricultural waste, are crucial for decarbonizing transportation sectors such as aviation, which are challenging to electrify.
