Sumitomo Corporation of America (SCOA), a subsidiary of Sumitomo Corporation, has entered into a Joint Development Agreement for the Louisiana Green Fuels (LGF) project with Strategic Biofuels (SBF), the developer behind LGF.

SCOA will take an anchor position and lead the formation of a Japanese-based investment consortium aimed at funding the majority of development capital needed to carry the project to Financial Investment Decision (FID) and commencement of construction in early 2025. As part of the agreement, SCOA will also acquire rights at FID to participate for a portion of the full project equity requirement.

In a strategic shift related to the investment, Strategic Biofuels also unveiled plans to change its primary renewable fuel product to sustainable aviation fuel (SAF). SCOA intends to provide a 20-year offtake for the approximately 640 million gallons of renewable fuels produced as well as all state and federal renewable fuel credits.

Once completed, the Louisiana Green Fuels Plant is expected to produce approximately 32 million gallons annually of renewable fuels. The plant will produce about 83% sustainable aviation fuel that can be blended at up to 50% with petroleum-derived jet fuel, and 17% renewable naphtha, a gasoline blend.

SAF is a renewably produced fuel specifically created to reduce the considerable carbon emissions of commercial aviation. When the LGF project was first announced, Strategic Biofuels garnered recognition for the extraordinarily low carbon footprint of the planned renewable diesel fuel product.

The LGF plant will utilize:

• Approximately 1 million tons per year of forestry waste as the feedstock for the biorefinery;

• Green energy from an integrated biomass-fired power plant that will take nearly 1 million tons of sawmill waste annually to produce 86 megawatts of power; and

• Geologic carbon sequestration of 1.36 million metric tons per year of CO₂ produced from both of those operations.

This investment commitment from SCOA continues the path from 2023, which was a year of rapid project advancement for LGF. Most recently, Strategic Biofuels announced that the Louisiana Department of Environmental Quality had issued an Air Permit for the integrated LGF facility, an industry first of its kind in Louisiana and a major step forward for the project. This followed an agreement with SLB, a global technology company, to provide its industry-leading technical services for the company’s planned carbon sequestration complex.

Earlier in the year, the EPA deemed the project’s Class VI permit application for carbon sequestration as “administratively complete,” which included extensive geologic data collected from LGF’s 2021 Class V stratigraphic test well.

Further, the EPA announced on 29 December 2023 that it was awarding “primacy” to the State of Louisiana, conveying to the state’s Department of Natural Resources the right to issue Class VI permits for geologic sequestration of carbon dioxide. Louisiana is only the third state to be granted this authority. As has occurred in the only two other states granted primacy, that action is expected to accelerate the schedule for regulatory review and Class VI permit issuance.

Sumitomo Corporation of Americas is the largest subsidiary of Sumitomo Corporation, a leading global trading company, with 108 locations in 65 countries and 20 locations in Japan. The entire Sumitomo Corporation Group consists of 900 companies and more than 80,000 personnel. The Sumitomo business is continuously expanding into a diverse range of products and services. As of 31 December 2023, Sumitomo had total assets of over $72 billion and cash-on-hand of over $4.26 billion.