The Canada Infrastructure Bank (CIB) has concluded the financing on its first project from its low-carbon fuels, carbon capture utilization storage and H₂ initiative with support for a biorefinery and the country’s largest electrolyzer.

Under the terms of the agreement, the CIB will provide a loan of $277 MM to a joint-venture partnership between Shell, Suncor, Proman and the government of Québec that will enable construction of Canada’s largest biorefinery, based on a technology platform developed by Enerkem.

The $1.2-B facility – known as Varennes Carbon Recycling – will include an electrolyzer which will supply clean H₂ and oxygen to convert more than 200,000 tons of non-recyclable waste and residual biomass into biofuels with a capacity of up to 130 million liters annually.

The project is expected to create more than 500 jobs at the peak of construction and about 100 permanent jobs once operational. CIB funding supports Quebec’s leadership in renewable energy and innovation and Canada’s aim to be net zero by 2050. The CIB loan aims to provide financing to a relatively emerging industry with upside.

The project will be using Enerkem’s proprietary thermochemical process. The carbon recycling facility is expected to cut more than 170,000 tpy of greenhouse gas emissions and 4.25 MM tons over the project’s 25-year lifespan. The annual reduction is equivalent to taking 50,000 passenger vehicles off the road.

“The Canada Infrastructure Bank is pleased to have acted quickly on its expanded role to support transformational efforts to accelerate Canadas transition to a low-carbon economy. Converting waste and residual biomass into clean H₂ is the CIBs latest effort helping the country reach net zero by 2050 and represents its first investment in low-carbon fuels,” said Ehren Cory, CEO, Canada Infrastructure Bank.

“The largest biorefinery in Canada will open its doors in Varennes, with the help of a loan from the Canada Infrastructure Bank. By supporting innovation here at home, the Canada Infrastructure Bank is giving Canada more tools to continue the fight against climate change, creating good jobs and generating wealth, here in Quebec,” said Pablo Rodriguez, Minister of Canadian Heritage and Quebec Lieutenant, on behalf of Dominic LeBlanc, Minister of Intergovernmental Affairs, Infrastructure and Communities.

“Clean fuels are an essential part of the clean technology mix in a net-zero world. While electrification will be a chosen route in some sectors, clean fuels will also play a very significant role going forward. Projects like this will accelerate important work to help Canada achieve its ambitious environmental and economic objectives I look forward to continuing to work with the Canada Infrastructure Bank and private sector partners to produce the clean H₂ the world needs,” said Jonathan Wilkinson, Minister of Natural Resources Canada.

“We are pleased the Canada Infrastructure Bank has agreed to support Varennes Carbon Recycling and charted a path forward for this important project. The transition to a lower carbon energy system requires collaboration that brings technology, expertise and governments together with industry for society to achieve its climate ambitions,” said Andrew Murfin, General Manager New Fuels, Shell.