Valero Energy proposes new renewable diesel plant in Texas, US

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Valero Energy, together with Darling Ingredients, has initiated an engineering and development cost review for a new renewable diesel plant in Port Arthur, Texas in the US.

In response to the increased demand for renewable diesel in low-carbon markets, the facility under review would be designed to produce 400 million gallons of clean fuel per year, as well as 40 million gallons of renewable naphtha.

The plant will be owned and operated by Diamond Green Diesel, which is the 50/50 joint venture between Valero and Darling.

The proposed facility in Port Arthur would be the first renewable diesel plant in the state of Texas; its location will leverage Valero’s existing refinery and optimise logistics management.

Production from the new plant would increase Diamond Green Diesel’s annual renewable diesel production capacity to around 1.1 billion gallons, with almost 100 million gallons of renewable naphtha.

According to Valero, final investment decision on the project is expected in 2021, subject to further engineering, obtaining necessary permits, and approval by both company boards. If plans go ahead, plant construction could begin in 2021, with operations slated to start in 2024.

“We expect low-carbon fuel mandates across the globe to continue to drive demand growth for renewable fuels,” said Joe Gorder, Valero chairman, president and CEO. “This project would meaningfully expand our renewable diesel segment, which continues to generate strong results, and demonstrates our commitment to environmentally responsible operations.”

The joint venture’s future total production capacity includes volumes from Diamond Green Diesel’s plant in Louisiana, which is currently being expanded to produce 675 million gallons of renewable diesel and 60 million gallons of naphtha. The expansion should be complete by the end of 2021.