A capital loan of EUR 6 million from the Finnish Climate Fund to Lamor’s project company to solve the recycling challenge of plastics

Lamor Corporation Plc         Press Release        22 May 2023 at 8:45 a.m. EEST 

A capital loan of EUR 6 million from the Finnish Climate Fund to Lamor’s project company to solve the recycling challenge of plastics

The Finnish Climate Fund has decided on a capital loan of 6 million euros to Lamor’s project company Lamor Resiclo Oy to enable the construction of a chemical recycling facility for plastics in Kilpilahti, Porvoo. The facility will make it possible to reuse the plastics that are difficult to recycle, instead of using incineration as a disposal route. Participating in solving the global plastics challenge with a 100-kiloton project portfolio of recycled plastics is one of Lamor’s strategic targets for the strategy period 2023-2025. 

Finding a solution to the plastics challenge is crucial for tackling climate change and transitioning towards a circular economy. The plastics industry, and more specifically plastics manufacturing, accounts for more than three percent of global emissions, and the volume of plastic waste has doubled worldwide in the last twenty years. Only one tenth of all plastic waste is currently recycled appropriately.  

Lamor has together with Resiclo Oy set up a project company Lamor Resiclo Oy in 2022. In the first phase, Lamor Resiclo will build a facility with a 10,000-ton annual capacity in the Kilpilahti area in Porvoo, Finland. In the medium term, estimated by the end of 2026, the aim is to build a distributed chemical plastics recycling capacity of approximately 40,000 tons in Finland. In addition to the projects in Finland, Lamor is planning to expand the plastics recycling capacity in the areas strategically important for Lamor, for example in the Middle East and South America.

“The Finnish Climate Fund’s investment plays an extremely important role in our investment. Building Finland’s first industrial-scale chemical recycling plant for plastics is a significant step towards a carbon-neutral society and a major step for Lamor when entering a new business area of plastics recycling. Our objective in Kilpilahti is to test the economic viability of the business model as well as the scalability of the technology. The facility will act as a benchmark for subsequent projects as we target to create a 100,000-ton project portfolio of recycled plastics by the end of 2025. It is important that we will be able to invite customers and potential partners to visit the facility. It will give us more credibility than presenting the plans only on paper”, explains Mika Pirneskoski, CEO of Lamor. 

The facility will make it possible to reuse plastics that are incompatible with mechanical recycling processes and therefore difficult to recycle, instead of having to dispose of them by incineration as waste. The plant will produce pyrolysis oil, which can be used as a substitute for crude oil in the production of, for example, plastics and other chemicals, thereby reducing the consumption of virgin feedstocks. 

“Finland is one of the global leaders in producing both bio-based plastic substitutes and a wide range of circular economy solutions that can help to address the plastic waste problem. It is important for the Finnish Climate Fund to take part in accelerating the deployment of these solutions to solve the plastic challenge, and Lamor Resiclo’s plant in Kilpilahti promises to recover valuable raw materials that are currently wasted”, says Paula Laine, CEO of the Finnish Climate Fund. 

There are hundreds of diverse kinds of plastics and not all of them can be recycled in the same way. The primary recycling process is mechanical and involves crushing, melting, and moulding plastic waste before turning it into pellets that can be reused. Certain types of mixed plastics and thermoplastics, however, are incompatible with mechanical recycling processes and are therefore usually disposed of by incineration. The chemical recycling process makes it possible to break down plastics that are difficult to recycle otherwise and to liquefy them by means of a catalytic reaction.  

Lamor Resiclo will build a chemical recycling facility in Kilpilahti, Porvoo, which will use pyrolysis technology to liquefy plastic waste and turn it into pyrolysis oil. Pyrolysis oil can be used as a substitute for fossil crude oil in the production of new plastic components and chemicals. The resulting products all have the same properties as those made using virgin feedstocks and they are safe to use in demanding applications, such as in the food industry.  

The process has an emission reduction potential of between approximately 1.8 and 2.4 tonnes of CO2 equivalent per one tonne of plastics feedstock. The annual emissions reduction rate at the Kilpilahti facility’s design capacity is currently estimated at 19,000 tonnes of CO2-eq on average and the plant’s cumulative ten-year emissions reduction potential is estimated at approximately 0.2 million tonnes of CO2-eq. The Kilpilahti facility will serve as a reference for Lamor, whose broader goal is to scale the operations. This would also increase the total emissions reduction potential considerably.

Chemical recycling is considered consistent with the EU taxonomy for sustainable investment activities if mechanical recycling is not a technologically and economically feasible option. The waste to be fed into Lamor Resiclo’s process cannot be recycled mechanically. 

Further enquiries 

Mika Pirneskoski, CEO, Lamor Corporation Plc, puh. +358 40 757 2151 

Johanna Grönroos, CDO, Lamor Corporation Plc, puh. +358 400 741 075 

Lamor in brief 

Lamor is one of the leading global providers of environmental solutions. Lamor provides its customers with versatile environmental protection and material recycling solutions and services, such as clean-up and preparedness services related to oil spill response and environmental incidents, services for the treatment of waste, recycling of plastics, and tailored and adapted soil and water treatment solutions. Lamor operates together with its local partners, offering a wide selection of solutions, which can be tailored according to the needs of each customer, and aiming to clean the world for which the company has worked since its incorporation. The company's share is listed on the Nasdaq First North Premier Growth Market Finland marketplace maintained by Nasdaq Helsinki under the trading code LAMOR. Further information: www.lamor.com. 

Finnish Climate Fund in brief 

The Finnish Climate Fund is a Finnish state-owned special-assignment company. Its operations focus on combating climate change, boosting low-carbon industry and promoting digitalisation. The Climate Fund invests in large-scale projects in which the fund’s investment is crucial to enable the project’s realisation in the first place, on a larger scale or earlier than it would with funding from elsewhere.