Chile’s Biobío region advances pilot Power‑to‑Liquids project using local CO₂ and green hydrogen

INERATEC has delivered a basic engineering study for a pilot Power‑to‑Liquids (PtL) facility to be sited within ARAUCO’s industrial complex in Chile’s Biobío region, advancing a multi‑party effort to convert biogenic CO₂ and renewable hydrogen into low‑carbon transport fuels and specialty chemicals. According to the company, the study lays out modular plant layouts, material flows and utility requirements for a two‑step syngas‑to‑fuel process that would pair ARAUCO’s captured CO₂ with green hydrogen supplied by Abastible.

The initiative builds on concepts developed during the Energy Challenge 2023 and subsequent H2Uppp feasibility work, and has been supported by a CORFO grant awarded to Bioforest, ARAUCO’s research arm. ARAUCO will supply on‑site industrial CO₂ from its pulp and forestry operations while Abastible will provide electrolytic hydrogen produced with renewable power. Copec and its investment arm, Copec Wind Ventures, have underwritten parts of the engineering work and will lead downstream integration and distribution planning. INERATEC’s chief executive, Tim Böltken, said: “We’re marrying local CO₂ streams with green hydrogen to prove an integrated PtL value chain can thrive right here in Chile.”

The technical concept follows established PtL practice: captured CO₂ and green H2 are converted into syngas, which is then processed in modular Fischer‑Tropsch reactors to produce drop‑in products such as kerosene, diesel and naphtha. INERATEC emphasises the skid‑mounted design for ease of assembly and flexibility to adapt to varying feedstock availability.

Economic and strategic rationale centres on localisation of value and the prospect of creating a regional e‑fuel cluster. CORFO’s funding aims to accelerate demonstration projects that validate CO₂ capture and hydrogen use cases; Bioforest’s awarded subsidy is part of a broader national push that CORFO says will mobilise significant private investment into green hydrogen and related industries. Copec, which commands a large share of Chile’s fuel distribution network, has signalled that an operational pilot would benefit from immediate access to real‑world logistics and offtake channels.

Industry actors point to tangible advantages from this configuration. Using biogenic CO₂ captured on‑site avoids long‑distance carbon transport and retains jobs and supply‑chain activity within the region. Industry benchmarks cited by project supporters indicate that e‑fuels produced from renewable hydrogen and recycled CO₂ can reduce lifecycle greenhouse gas emissions substantially compared with fossil counterparts, although exact savings depend on energy sources and process efficiencies.

Nonetheless, significant challenges remain for commercial scaling. Green hydrogen production continues to command a premium versus fossil‑derived alternatives, and the economics hinge on sustained, low‑cost renewable electricity and the capital intensity of electrolysis and fuel synthesis equipment. The modular reactors must demonstrate reliable continuous operation, and Chile’s regulatory framework for e‑fuels and long‑term offtake arrangements is still evolving. According to project announcements, the partners view CORFO backing and private investment as critical to de‑risking the pilot stage.

The collaboration also forms part of a wider set of initiatives across Chile linking hydrogen, CO₂ utilisation and industrial decarbonisation. Abastible has separately been developing green hydrogen projects aimed at producing low‑carbon ammonia and fertilisers, while Bioforest’s Synfuels Biobío initiative is pursuing validation of forest‑sector CO₂ capture technologies at commercial sites. INERATEC and Copec have likewise discussed a potential larger‑scale PtL facility capable of several thousand tonnes per year of e‑fuel output, indicating an intention to move beyond demonstration if technical and market conditions prove favourable.

For industrial decarbonisation stakeholders, the Biobío pilot represents a practical test of integrating feedstock capture, electrolytic hydrogen production and modular synthesis technologies within an established industrial cluster. If the pilot confirms technical viability and improves cost trajectories, the model could inform replication across other forestry‑intensive regions and help create demand‑side pathways for hydrogen beyond power and light transport sectors. The partners have not announced a construction start date; the current milestone is completion of the basic engineering package that will underpin subsequent permitting and financing steps.