Total is investing €200 million to transform its La Mède refinery into France’s first biorefinery, the company announced on Thursday.

The new biorefinery will be one of the biggest in Europe and should help Total meet growing demand forbiofuels, according to company officials.

Total says it will maintain some petroleum product refiningoperations at the site. However, it will halt the processing of crude oil by the end of 2016, citing heavy financial losses.

The La Mède site's flagship operation will be a world-class, 500,000-tpy biorefinery to manufacture biodiesel primarily from used oils, as well as renewable feedstock.

The hydrotreated vegetable oil (HVO) process selected by Total is a French technology developed by Axens that produces high-quality biodiesel that is easily blended into regular diesel in any proportion, with no adverse impact on fuel quality or engines, according to company officials.

In its decision, Total cited a European Union directive, which set a target of 10% renewables in transportation fuels by 2020. Moreover, in France, a draft bill is calling for increasing the share of biofuels to 15% in 2030 from 7.7% today.

"La Mède’s forward-looking transformation reflects Total’s determination to play an active role in the development of renewable energies, especially biomass, which will be needed to partner fossil fuels to ensure that energy demand is met while at the same time mitigating carbon dioxide emissions," the company said in the statement.

Total says it will continue to operate its existing naphtha reformer at La Mède to produce the hydrogen needed for biorefining. 

"The existing synergies between La Mède, Naphtachimie and local petrochemical operations will be maintained, and Total is confirming its lasting commitment to Naphtachimie, a 50-50 joint venture with Ineos," the company said.

Total also plans to expand its production of jet fuel for civil aviation, targeting a 30% share of the overallEuropean market from the La Mède site.

Other initiatives at La Mède include developing a logistics and storage hub dedicated to refined product trading operations and building an 8 MW solar farm to meet 50% of the site's power needs.

Of the 430 current jobs at La Mède, 250 are planned to be maintained over the long haul. Of the 180 positions going away, Total says the workforce will be gradually scaled back through early retirements and manager transfers. The company says it is not planning layoffs at La Mède.

Also on Thursday, Total announced a €400 million project to upgrade its Donges refinery in France to produce low-sulfur fuels.