From biogenic carbon dioxide to fossil-free gas

Swedish industry uses large amounts of gas, particularly in the chemical and manufacturing sectors. Today, a significant share of this gas is imported via pipeline from Denmark and still largely consists of fossil natural gas.

To reduce emissions and strengthen energy security, Sweden needs to increase domestic production of fossil-free gas. One project that could contribute to this transition is currently being developed on the Värö Peninsula in Varberg on the Swedish west coast.

The plan is to build a facility that will produce so-called e-NG (Electric Natural Gas), a synthetic gas that can replace fossil natural gas in existing infrastructure.

A new pathway to fossil-free gas

The project is being developed by OX2 together with the forest industry group Södra and technology developer TES.

The ambition is to produce up to 1.2 TWh of e-NG per year by combining two resources already available in the area:

• Biogenic carbon dioxide from Södras pulp mill in Värö
• Hydrogen produced on site using renewable electricity

When these two components are combined, they form a synthetic gas that is chemically identical to natural gas, but without fossil emissions.

Because e-NG functions within the same system as natural gas, it can be used directly in today’s gas grid and industrial processes without requiring new infrastructure.

Södra’s pulp mill in Värö. During the production of pulp, biogenic carbon dioxide (CO₂ from biological sources) is generated as a natural by-product. Photo: Per Pixel

Significant potential for Sweden’s gas supply

If realised, the project could have a substantial impact on Sweden’s energy system. Annual production of 1.2 TWh of e-NG would:

• increase the share of fossil-free gas in the Swedish gas grid from around 35% to 60%
• represent more than a sixfold increase in domestic production of fossil-free gas
• reduce dependence on imported fossil natural gas

It would also help strengthen energy resilience and competitiveness for Swedish industries that rely on gas in their processes.

From forest industry to energy resource

An important part of the project is its connection to Södras pulp mill in Värö. During the production of pulp, biogenic carbon dioxide is generated as a natural by-product.

By capturing this carbon dioxide and using it in the production of e-NG, it can instead become a valuable feedstock in a new energy system.

This creates an example of how different industries can be integrated into future circular energy solutions.

Next steps in the project development

The project is currently in the pre-FEED (early development) phase, which runs until the end of 2026. During this phase, the partners will:

• develop the technical design of the facility
• assess how the production can be integrated with Södras existing industrial operations
• secure connections to electricity and gas networks
• advance permitting processes and develop commercial agreements

The pre-FEED phase is partly supported by funding from the Swedish Energy Agency through the Industrial Leap (Industriklivet) programme, which aims to reduce industrial emissions.

If the project proceeds to investment and construction, the facility could be commissioned in the early 2030s.

A collaboration across the value chain

The project brings together expertise from different parts of the energy system:

Södra contributes biogenic carbon dioxide from its pulp production

OX2 develops wind power in the region and contributes renewable electricity for hydrogen production

TES provides technology and experience from international e-NG projects

Together, the partners are developing a solution that can support industrial decarbonisation, lower emissions and increased energy self-sufficiency in Sweden.

Published 2026-03-06