Canola meal leftover from canola crushing could be used for feeding tilapia fish, seen here. Video licensed to Brian Zinchuk via Storyblocks
REGINA – The federal Clean Fuel Standard (CFS), whose purpose is to decarbonize fuels, has proven to be a driving force behind numerous canola crush facilities announced in Saskatchewan over the past year, including Federated Co-operatives Ltd.’s own announcement of a renewable diesel facility in Regina, adjacent to its oil refinery.
On Jan. 17, Federated Co-operatives Ltd. (FCL) announced a joint venture with AGT Foods and Ingredients to build a canola crush facility adjacent to that renewable diesel facility, creating the second component of what the two companies are referring to as their Integrated Agricultural Complex.
Pipeline Online asked FCL CEO Scott Banda, AGT Foods and Ingredients Ltd. president and CEO Murad Al-Katib and Premier Scott Moe if the joint venture canola crush plant would be going ahead without the CFS, how far it would go to meet the volumes needed by Western Canada to meet the CFS, and where would those volumes come from otherwise.
FCL CEO Scott Banda. Screen capture
Banda said it would be 2027 before the project is complete, which is five years away, but the CFS is coming in much sooner than that. “So we’ll have to find a way to comply, either buy other products, or do something different to ensure that we meet the standards.
“We believe this is an important transition for our economy, for the world, frankly, and we have an opportunity to take advantage by getting in now and making the investment and making that transition.
“So that’s the decision we’ve made, as a company; that we see opportunity in converting to a renewable diesel operation. What makes it really exciting is the partnership we have here with the canola crush piece and AGT where we can really integrate this into our broader business. As many of you are aware, we’re involved in the agriculture sector, the food business farming, home and building solutions, as well as energy. So this provides a lot of synergies and where we’re uniquely positioned to gain advantage from that and to serve the communities and the people of Western Canada in a deeper way.
“As for the specific pieces about exactly how much of the demand this will meet and the technical compliance, there are so many pieces that are still moving yet that I I’m not going to speculate on that. But we’re very comfortable in what we’re building will position our organization to meet the targets that we need to meet.”
AGT Foods & Ingredients president and CEO Murad Al-Katib. Screen capture
ESG movement wants renewable fuels
Al-Katib said, “The driver of this overall strategy, in addition to the regulatory side and compliance and the Clean Fuel Standard, is really the whole ESG movement,” referring to environment, social and governance.
“We’re also seeing the transportation industry, the consumer abroad, at large, there’s a desire for smart capital which is kind of driving this.”
He pointed out that Class 1 railways, trucking companies, steamship lines around the world and the agricultural communities are reacting back to the consumer. “There’s that desire for a cleaner, fuel opportunity, and I think that ultimately, in addition to regulatory, we’re meeting what is going to be the demand profile that’s coming forward in the newer economy that we’re moving into.
“So I think that this is a much broader drive that ultimately, is not only the right thing to do, as Scott (Banda) mentioned earlier, but we’re going to be reacting to the needs of consumers. And when I look at my sector; retailers, consumers, the food companies, and smart capital are driving us to a sustainability profile that we’re not achieving today. This is going to be another way, when we overlay digital agriculture, capturing data, analytics and truly looking at the sustainability of our system, this makes a lot of sense.”
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Pipeline Online asked about taking acres out of food production and putting them into fuel production, and whether, philosophically, shouldn’t we be using land and food to feed people here and abroad as opposed to filling our gas tanks?
Al-Katib responded, “Actually, we’re saying that the canola meal that is going to be coming out of the extraction, we actually think that, through the use of innovation and technology, we’re going to be able to actually extract the protein, combine it with other ingredients, make it more bioavailable, and actually increase the benefits to the food system from the current utilization of that product.
“So, again, when we look at canola protein concentrates in that 65 per cent range that we can naturally extract out of the canola meal, and put it into things like efficiently growing salmon, tilapia and shrimp for the world, that growing demand for seafood. We think there’s actually a leverage on the protein extraction.
“So we think that we can achieve both, actually. We gain on the food side and we gain on the fuel side. And ultimately, we gain in local communities. So, we don’t feel we’re taking it out of the food system. We feel, in fact, we’re leveraging it and bolstering the availability of that food stock, for the human food system.”
Banda said, “Yeah, we do not see it as an either/or, that there’s a value-add here. And with the technology advancements in the agriculture sector and the capacity to grow crops and to have greater yields, that we see this as an enormous opportunity to build upon, not an either/or.”
Premier Scott Moe. Screen capture
Change in thinking, says Moe
Moe added, “This is a change in thinking for us in this province. Traditionally, you know, being an agrarian based province, we’ve always thought that the only way to produce more food is, one, to produce more acres, to seed more acres or to increase, ultimately, your production.
“What we’re doing here, and Murad referenced, is a gain, not only on the fuel side, on the environmental side, but it’s a gain on the food side as well.
Moe said this is a world-class initiative put forward by AGT and FCL are putting forward, saying it is “taking the innovation that we have and combining that with innovation that’s available into the future to really be able to win and increase, not only our environmental sustainability, but to increase and preserve the opportunity to have access to fuel, environmentally sustainable produced fuel here in Saskatchewan, but at the same time using that innovation to actually increase the access to ingredients.
“And that’s the shift that’s happening in Saskatchewan and AGT has been a big part of this over the course of the last few years and the last few decades. We are no longer producing agrifood products in Saskatchewan. We are now moving into the area of producing ingredients. We’re climbing that value chain and with those ingredients, we’re able to actually make more usable protein, more usable food ingredients, to make that available to North American and to the world.
“And so, this is really speaks to the synergies that these two world-class companies are bringing together here today for the benefit of all Canadians and all global citizens on so very many fronts,” Moe concluded.
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