UPM postponed the commercial start-up of its Leuna biorefinery in Germany to the second half of this year, due to quality-related issues in the sugars-to-chemicals process.
In its annual report, Massimo Reynaudo, President and CEO, comments on this issue:
“At the Leuna Biorefinery, we initiated the commissioning and start-up in late 2024 and have made good progress in most units. However, during the quality assurance checks we identified certain corrective works required in the sugars-to-chemicals process. These works have been arranged and will take a few months. Meanwhile, the sequential start-up in the other units continues. The integrated commercial production of the site is expected to start in H2 2025.
Our positive view on the attractive business case in biochemicals remains unchanged.
The Leuna Biorefinery is a first-of-its-kind project, which has been implemented during a series of external crises, such as the COVID 19 pandemic and the war in Ukraine with subsequent resource and supply chain challenges. As we are approaching the completion of the project, we have made an impairment of EUR 373 million on the biorefinery assets resulting from the cost overruns and construction delays during the project. The book value of the refinery now reflects the estimated cost to construct a similar plant”.