Thailand Attracts Biofuel Investments as Maritime Sector Ramps Up Decarbonization Efforts

Thailand’s leading energy companies, including Bangchak Corporation and state-owned PTT, are intensifying investments in biofuel production to support the global push for maritime decarbonization. The country’s strong biomass potential is also drawing interest from foreign investors, with Chinese biodiesel firm Zhuoyue New Energy recently committing RMB 700 million (approximately USD 97.5 million) to build a new facility in Thailand.

The move aligns with growing pressure from international shipping regulators. Marine fuel publication Ship & Bunker reports that the shipping sector must incorporate 17.6% to 23.3% biofuel into its fuel mix by 2028 to meet International Maritime Organization (IMO) decarbonization goals. This mandate is expected to accelerate demand for alternative marine fuels.

In June, PTT’s Oil and Retail Business (OR) signed an MoU with Regional Container Lines (RCL) for the supply of Bio-VLSFO (bio-based Very Low Sulfur Fuel Oil), derived from used cooking oil. According to TotalEnergies, a 10% bio-blended marine oil can cut greenhouse gas emissions by up to 10%.

Meanwhile, Bangchak Corporation’s Sriracha Refinery has begun producing B24 — a blend comprising 24% UCOME (Used Cooking Oil Methyl Ester). The company confirmed that B24, first delivered in February, serves as a drop-in replacement requiring no modifications to existing vessels or bunkering systems.

Thailand’s Ministry of Energy has expressed full support for biofuel development. Sarawut Kaewtathip, Director-General of the Department of Energy Business, acknowledged the higher current costs of biofuels but noted that prices are likely to drop with scaling production.

China’s Zhuoyue New Energy cited Thailand’s abundant waste oil resources and strong government support as key reasons for its investment decision. Its upcoming facility in Chon Buri will produce 300,000 tons of biodiesel, 100,000 tons of hydrotreated vegetable oil (HVO), and sustainable aviation fuel annually.

Thailand’s Ministry of Energy estimates the clean fuels sector, especially sustainable aviation fuel (SAF), could attract over THB 114 billion (USD 3.5 billion) in investment.

Zhuoyue is also constructing a similar facility in Singapore, with a planned capacity of 1 million tons of biodiesel per year. Singapore’s strategic status as a global bunkering hub is expected to drive strong demand for the output.