The invention relates to a process for production of fatty acids directly from soapstock generated in the alkali refining process including the steps of (a) adding a lipase directly to the alkaline soapstock to facilitate hydrolysis of glycerides without prior neutralisation, (b) neutralizing and splitting the soaps with strong acids, and (c) separating the fatty acid phase from the aqueous phase by settling and/or centrifugation. A second embodiment is a process in which the soapstock is first neutralized and split with strong acids, followed by adding a lipase to facilitate glyceride hydrolysis, and separating the fatty acid phase. The fatty acids so obtained can be esterified with C1-C6 alcohols using a lipase that is selective for fatty acids and does not transesterify the sterolesters, and the fatty acid esters and sterolesters are separated by distillation. The sterolesters are useful as supplements for food, as pharmaceutical agents for lowering cholesterol and as biofuel and biodiesel.