Co-refining Market Growth Forecast 2034: From USD 39.7 Billion to USD 73.0 Billion with 6.0% CAGR

The global co-refining market was valued at US$ 39.7 billion in 2023 and is projected to grow at a CAGR of 6.0% from 2024 to 2034, reaching US$ 73.0 billion by the end of 2034.

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Analyst Viewpoint

The transition toward a low-carbon economy is significantly augmenting co-refining market revenue. Countries and companies are striving to limit global warming to 1.5° C and achieve net-zero GHG emissions by adopting low-carbon technology products. Additionally, the increased adoption of biofuels, which reduce the carbon footprint of difficult-to-decarbonize sections of transport, is driving the market value. Key players are focusing on co-processing woody fast pyrolysis bio-oils in fluid catalytic cracking and integrating advanced processes into existing refineries to harness the potential of biofuels.

Market Introduction

Co-refining, also known as co-processing, is a method used in the oil & gas sector to produce various types of fuels by processing different feedstocks-such as animal fats, used cooking oils, vegetable oils, biomass, waste plastics, or bio-based materials-alongside crude oil in a refinery. Co-processing can manufacture transportation fuels and petrochemical feedstocks using techniques like hydroprocessing, catalytic cracking, fluid catalytic cracking (FCC), hydrotreating, and hydrocracking.

Key Market Drivers

Transition Toward Low-carbon Economy:
The push for a low-carbon economy through renewable hydrogen, sustainable biofuels, and Carbon Capture and Storage (CCS)/ Carbon Capture and Utilization (CCU) is driving the co-refining market. Initiatives such as the European Commission's €720 million investment in renewable hydrogen projects and the U.S. DOE's $7 billion funding for regional "hydrogen hubs" underscore this trend.

Increase in Adoption of Biofuels:
The well-developed infrastructure of petroleum refineries makes co-refining of biomass-derived feedstocks with petroleum fractions an attractive option. This is crucial for producing biofuels that help reduce greenhouse gas emissions and strengthen energy security. The International Energy Agency (IEA) reports a rapid increase in biofuel investments, with capacity additions reaching a decade-high of around 260 kb/d in 2022.

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Regional Outlook

Europe:

Europe held the largest share of the co-refining market in 2023, driven by the need for rapid scale-up of biofuels production to meet climate mitigation targets in the transport sector. The EU-27 supplied around 16 million tons of Oil Equivalent (Mtoe) of biofuels in 2020, accounting for 6.3% of total transport fuel consumption. Investment in CCS is also propelling the market, exemplified by SINTEF's launch of the Horizon Europe project COREu, the largest Research and Innovation project in CCS funded by a European program.

Market Segmentation

By Feedstock Type:

Crude Oil Co-refining
Biomass Co-refining
Waste Plastic Co-refining
Renewable Feedstock Co-refining

By Processes:

Hydroprocessing
Catalytic Cracking
Fluid Catalytic Cracking (FCC)
Hydrotreating
Hydrocracking
Others

By Product:

Fame Biodiesel
Bioethanol
Hydrogenated Vegetable Oil (HVO)
Others

Regions Covered:

North America
Europe
Asia Pacific
Latin America
Middle East & Africa

Countries Covered:

U.S.
Canada
Germany
U.K.
France
Italy
Russia & CIS
Japan
China
India
ASEAN
Brazil
Mexico
South Africa
GCC

Key Players

Key players in the co-refining market include Bharat Petroleum Corporation Limited, China National Petroleum Corporation, ExxonMobil Corporation, Saudi Arabian Oil Co., Valero Energy Corporation, Marathon Petroleum Corporation, ROSNEFT, and Petroleos de Venezuela S.A. These companies are focusing on the co-processing of Sustainable Aviation Fuel (SAF) due to rising demand, utilizing existing infrastructure to adopt renewable feedstocks.

Key Developments:

Meridian Energy Group Inc.: In April 2024, the company announced the Belfield refinery's capability to co-process up to 4,000 barrels/day of vegetable oil.
Saudi Aramco TotalEnergies Refinery & Petrochemicals Co. (Satorp): In 2023, the joint venture completed the production of SAF from co-processing used cooking oil at its refinery complex in Jubail, Saudi Arabia.

Market Snapshot

Market Size in 2023: US$ 39.7 Bn
Market Forecast (Value) in 2034: US$ 73.0 Bn
Growth Rate (CAGR): 6.0%
Forecast Period: 2024-2034
Quantitative Units: US$ Bn for Value and Kilo Tons for Volume

Competition Landscape:

Market share analysis by company (2023)
Company profiles include an overview, product portfolio, sales footprint, key subsidiaries or distributors, strategy, recent developments, and key financials

Conclusion

The co-refining market is set for substantial growth, driven by the transition to a low-carbon economy and increased biofuel adoption. Europe leads the market, bolstered by significant investments in biofuels and CCS. Key players are innovating in SAF production and integrating advanced processes into existing refineries to capitalize on the potential of renewable feedstocks.

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