Diamond Green Diesel, a joint venture company between Darling Ingredients and Valero Energy, has entered into a long-term lease agreement with IMTT to enhance distribution logistics.
The agreement will allow Diamond Green Diesel to access and use the St. Rose IMTT terminal as a logistics hub for the company’s existing and expanding renewable diesel facility, located in Norco in the US state of Louisiana.
Under the terms of the agreement, IMTT will construct two five-mile pipeline connecting its St. Rose terminal to Diamond Green Diesel’s facility in Norco. IMTT will also repurpose around 790,000 barrels of exiting storage capacity to store renewable diesel feedstock and finished product.
Construction of the pipelines and the storage capacity transition are expected to be in service before the end of 2021, to coincide with the anticipated start-up of Diamond Green Diesel’s current 400 million gallon expansion project.
Commenting on the agreement, John Bullock, executive vice-president and chief strategy officer at Darling Ingredients, said: "We are extremely pleased to be working with IMTT. What is so often overlooked when discussing the critical success components of renewable diesel economics is the supply chain, which is both complicated and costly to manage.
"Having a world-class terminal like IMTT St. Rose accessible by pipeline with the capability to receive feedstocks and ship product via multiple modes of transport creates a significant competitive advantage for us. Diamond Green Diesel has been a leader in the industry and developing a sophisticated and flexible supply chain is a continuation of our leadership position.
“We would not be in this business without a thorough plan that provides for flexibility in raw material sourcing and finished product marketing. This agreement places us in a position to economically source renewable diesel feedstock while allowing us to supply the best markets for our renewable diesel and naphtha."
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