Hybrid diesel-electric propulsion cuts fuel use by around 95 percent…
August 14, 2018 | The Wall Street Journal
One of the best-performing stocks in the global oil sector this year is a company that makes most of its money without touching crude.
Finnish state-backed refiner Neste Oil NTOIY -0.26% has carved out a niche using proprietary processing to turn animal fat and plant oil into renewable diesel. The product has virtually the same chemical properties as diesel made from fossil fuels, but produces a fraction of the carbon emissions.
Neste has found a way to make cleaner fuels a large part of its business as big oil companies face pressure to transition away from carbon-heavy energy sources. Even as companies such as Exxon Mobil Corp. and Royal Dutch Shell PLC make room in their product portfolios for alternative energy sources, oil and gas are expected to remain their core profit driver for years to come.
“I can tell you, nobody believed us,” said Chief Executive Matti Lievonen. “We innovated something completely different—never in the marketplace. That was the breakthrough.”
Studies show that renewable fuels like Neste’s diesel can reduce overall greenhouse-gas emissions by 60% or more, said Robert McCormick, a senior research fellow at the National Renewable Energy Laboratory. Last year, Neste estimated its products helped decrease emissions by 8.3 million tons, which it said was the equivalent of taking 3 million cars off the road.