8Developing future
solutions
The 2020 development activities were shaped by the establishment of the European Commission’s climate neutrality goal and the publication of the Green Deal created in order to achieve the goal. The Green Deal does not have an immediate effect on VKG’s production activities, but it does have a direct impact on development projects related to the valorisation of oil shale.
The development of the shale oil pre-refining plant continued in cooperation with Eesti Energia in 2020. The aim of the project was to valorise all of the shale oil produced in Estonia into low sulphur content ship fuel and/or raw material suitable for refineries. The planned processing capacity of the plant was 1.6 million tons of shale oil a year, of which VKG’s share would have been 0.7 million tons a year. The first stage of the project included pilot testing and the preparation of a preliminary design for the plant. The market price of shale oil grew thanks to the IMO 2020 ship fuel regulation that entered into force in 2020, making the production of the current products more profitable, while significantly reducing the cost-effectiveness of the pre-refining plant. Due to this, the parties decided to suspend the project in its current form. As a spin-off of the project, the possibilities of hydrogen processing of oil shale petrol will also be analysed.
In the area of reducing the CO2 emissions of the current industry, we continued analysing the production of more valuable products from retort coal gas. In the course of that, we explored the separation of a maximum amount of gas petrol from gas through compression and cooling as well as synthesising the most valuable chemicals from the remaining gas. An area of use different from the current energy application would allow binding the carbon in the gas into a useful product. As the potential industrial solutions are capital-intensive and the future of the regulations concerning the oil shale industry is uncertain, we have suspended those development activities for now.
In the light of the European Green Deal, VKG has analysed the Group’s possibilities of capturing CO2 emissions in a chimney and to deposit CO2 (the so-called CCS project) or use CO2 for producing other products (the so-called CCU project). The use of such solutions is not yet reasonable at today’s prices and there are currently no realistic possibilities for large-scale CO2 depositing.
In the area of renewable energy, VKG has been developing a solar power plant project at Ahtme and has participated in renewable energy auctions with the project.
The 2021 development activities are mainly focused on the following topics:
Reducing the environmental footprint of the existing production activities
this includes the valorisation and reuse of the side products of shale oil production as well as continued work on increasing the reuse of ash.
Participation in the scheduled renewable energy reverse auctions with renewable energy projects.
Taastuvenergia projektidega osalemine planeeritavatel taastuvenergia vähempakkumistel
IT developments
In the area of IT, the Group mainly focused on ensuring the reliability of existing programmes and introducing the Enterprise Resource Planning (ERP) system in 2020. The implementation of the approved IT Strategy continued.
We integrated VKG’s IT systems with the new ERP: the Scalex weighing programme, the OSIPI operational reporting programme, the IFS asset management programme, the WebDesktop document management programme. We are planning to make the transition to the new application by summer 2021 at the latest.
We continue to pay great attention to the security of the computer network. We took part in the cyber training organised by the Estonian Information System Authority for energy sector enterprises. In 2020, we replaced all the LAN switches, upgraded wireless LAN access points and completed the LAN segmentation. We also updated monitoring and reporting systems and implemented the MS Teams teamwork software in the entire Group, facilitating the successful implementation of teleworking and home office capabilities. On a current basis, we upgraded the Group’s computer and server hardware in order to provide our users with modern work tools and environments.
The main aim for the IFS asset management programme in 2020 was the development of its interfacing to ERP, as all the Group’s enterprises will make the transition to the new ERP in 2021. During 2020, we made a big step forward in digitising reports, establishing various monitoring routines and analysing asset management.
In 2021, we shall introduce the enterprise resource planning (ERP) software, implement the automation and IT strategy and focus on the updating and analytics of the Group’s PI methodology. In the area of infrastructure, our focus will be on the data warehouse, the reliability, security and everyday user support of ERP, the undisrupted functioning of the existing servers, in order to ensure the availability of the offered services.