Vertex to produce renewable diesel at Louisiana refinery | Biomassmagazine.com – Biomass Magazine

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Vertex Energy Inc. on May 26 announced it has entered into a definitive agreement to acquire an oil refinery located in Mobile, Alabama. The company plans to convert a portion of the facility to renewable diesel production.

According to Vertex, the refinery is currently owned by Equilon Enterprises LLC doing business as Shell Oil Products U.S, Shell Oil Co., and Shell chemical LP, subsidiaries of Royal Dutch Shell plc. Vertex plans to acquire the facility for $75 million. Subject to regulatory clearance and various closing conditions, the sale is expected to close in the fourth quarter of this year.

Vertex said it plans to complete an $85 million upgrade of the refinery’s hydrocracking unit by the end of 2022, enabling the production of renewable diesel. Once complete, the converted facility is expected to have the capacity to produce 10,000 barrels per day of renewable diesel and renewable byproducts. My mid-2023, Vertex plans to expand capacity to 14,000 barrels per day. The facility, which currently has a production capacity of 91,000 barrels per day, will also continue to supply conventional fuels.

Vertex expects to source renewable feedstock through a multi-year agreement with Synergy Supply and Trading, a subsidiary of Bunker Holding Group, and potentially from the company’s planned pretreatment facility in Belle Chasse, Louisiana. For distribution, the company plans to enter an agreement under which Idemitsu Apollo Corp., a wholly owned California-based subsidiary of Idemitsu Kosan, will purchase 100 percent of the facility’s renewable diesel production.  

“The acquisition of the Mobile refinery will be the largest, most significant transaction ever completed by Vertex, one that positions us to become a leading regional supplier of both renewable and conventional products,” said Benjamin P. Cowart, president and CEO of Vertex. “We will acquire an exceptional refining and logistics asset of scale, one equipped with significant feedstock optionality, together with a high-value, distillate-weighted product slate. As part of this transaction, Vertex will assume ownership of more than 3 million barrels of crude oil and product storage, together with other valuable logistics assets. Our vision for this site is that of diversification. We will seek to lead the southeast region in marketing next generation fuels and products that are not currently produced by the refinery today. Our entry into these new markets is expected to generate significant, long-term value for our shareholders, while adding new jobs and economic stimulus to the regional market.”

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