Spread the hazelnuts on a baking sheet in one layer. Bake at 350 degrees for 10 to 13 minutes.
Wet a dish towel and wring it out as best you can. Dump all the baked hazelnuts into the damp dish towel.
Fold the dish towel over the hazelnuts and rub firmly and quickly, back and forth. This is rubbing off the shell coverings and they will stick to the towel. See the photo above.
Hand pick out the cleanest and toss them in a food processor.
Shake the dish towel out and then rub some more. Do this as often as you like but all of the shell skins will not come off. Do not worry about that. The nutella will still be delicious.
I rolled and picked out clean nuts about 5 times.
Add the cooled, toasted hazelnuts to the processor bowl.
Start processing. After a couple minutes, the nuts will start to clump together around the blade and it will be a smoother paste. Let your machine cool about every 30 seconds.
After about 5 minutes, your hazelnuts should be processed into a nice hazelnut butter.
Add the rest of the ingredients to the processor bowl and process again. This time it only takes 2 to 3 minutes until it is smooth and shiny.
This is a mixture that will thicken if you go too long so be careful and stop as soon as the mix is spreadable.