Neste urges EU to ease rules on biofuel feedstocks amid energy crunch

(Corrects oil, corn and sugar price rises in final paragraph)

By May Angel

LONDON, Oct 20 (Reuters) - Finnish biofuel maker and oil refiner Neste on Tuesday urged the European Commission to ease restrictions on biofuel feedstocks that do not put food supplies or forests at risk.

The appeal comes as higher fossil fuel prices driven by war have renewed interest in biofuels as a way to improve energy security and potentially reduce energy costs.

Biofuels, typically blended with fossil fuels, can be made from a range of organic materials, though most are produced from food and feed crops such as sugar and corn.

They have long been at the centre of debate over whether they help cut emissions and bolster energy security or instead drive deforestation and higher food prices.

For that reason, the European Commission limits the amount of biofuel feedstocks that can be grown in Europe.

Neste argues those concerns do not apply to second-generation, or advanced, biofuels made from intermediate or cover crops such as canola grown between harvests or on degraded land.

"The maximum availability in Europe from these intermediate crops is up to 27 million tons, but right now the certification rules disqualify a lot of the potential we have," said Samuel Maubanc, Neste's EMEA head of Public and Regulatory Affairs.

Maubanc was speaking at the Argus Biofuels Europe conference in London.

The Commission was not immediately available to comment.

Global biofuels output is expected to surge nearly 70% by 2030 ​from 2025 levels as major producing countries increase blending mandates, according to a recent study by London-based think tank Chatham House.

Crude oil prices have risen about 50% since the Iran war began in late February, sugar has gained some 40% while corn has risen about 3%.

(Reporting by May Angel. Editing by MarkPotter)