Planned to be built in the northern city of Kemi by the end of 2019, the biodiesel refinery will use wood-based biomass as main feedstock to produce 200,000 tons of biofuels per year.
The output from the refinery, which is expected to be the first of its kind in the world, will be a mix of 75% biodiesel and 25% biogasoline.
Sunshine Kaidi New Energy Group chairman and CEO Chen Yilong said: "We find Finland the most interesting country to invest in for biofuels production in the Northern hemisphere.
"Finland has vast biomass resources, plenty of potential partner companies and an extremely progressive biofuels policy."
Kaidi plans to make the final investment decision by the end of this year.
Expected to create 4,000 jobs during construction phase, the facility is estimated to generate annual tax revenues of over €200m.
Ministry of Employment and the Economy Permanent Secretary Jari Gustafsson said: "Promoting bioeconomy and versatile use of wood are key projects for the Finnish government.
"In addition, ensuring foreign investments that drive export and create new jobs are also one of our key goals."
Construction work on the refinery is planned to commence in 2017.
Kaidi is currently negotiating with subcontractors and other stakeholders for the project development.
The refinery project has already secured environmental impact assessment approval from the Centre for Economic Development, Transport and the Environment of Lapland.
Image: The wood-based biodiesel plant will be the first of its kind in the world. Photo: courtesy of Tina Phillips./FreeDigitalPhotos.net.
