Shell won't continue construction of its biofuels plant in Rotterdam

Energy major cites market dynamics and rising costs in decision to discontinue project.

Shell has announced it will not proceed with the construction of its planned biofuels facility at the Shell Energy and Chemicals Park Rotterdam (Pernis). The project, which began in 2022, was shelved following what the company described as a thorough commercial and technical evaluation of its competitiveness.

“Market dynamics and expected construction costs ultimately make this project insufficiently competitive to meet our customers’ demand for affordable biofuels,” said Machteld de Haan, President of Downstream, Renewables and Energy Solutions at Shell. “We want to focus our investments on projects that deliver value for both our customers and our shareholders.”

Despite the cancellation, Shell reaffirmed its commitment to low-carbon fuels, noting their importance in the energy transition. “We remain convinced that low-carbon molecules, including biofuels, are fundamental to the future energy system. Shell is already one of the world’s largest traders and suppliers of biofuels, including sustainable aviation fuel (SAF),” De Haan added.

The company said it aims to position itself as a leading partner for energy transition investments. Between 2023 and 2024, the company invested around $8 billion globally in low-carbon projects, including solar, wind, carbon capture and storage (CCS), hydrogen, and biofuels. 

In 2024 alone, Shell traded over 10 billion liters of low-carbon fuels, selling ten times more than it produced, and became one of the world’s largest suppliers of SAF. 

The Netherlands remains central to its energy portfolio. The company has invested €6.5 billion in Dutch energy transition projects in recent years, including the Porthos CCS project, the Holland Hydrogen 1 green hydrogen plant, and electrification upgrades at Shell Chemicals Park Moerdijk.