MOSCOW (MRC) -- U.S. refiner Phillips 66 and biodiesel producer Renewable Energy Group Inc have abandoned construction of a renewable diesel plant in Washington state following delays in receiving permits and uncertainties, the companies said, as per Hydrocarbonprocessing.
This marks a setback in what has been a major push by refiners including Marathon Petroleum, HollyFrontier and Valero to produce diesel from soybeans and other organic products and earn lucrative tax credits for generating the fuels.
The proposed 250-million-gallon-per-year project would have been the largest renewable diesel refinery on the West Coast of the United States, the companies said.
The refinery was planned to be constructed adjacent to Phillips 66’s Ferndale Refinery, looking to take advantage of existing infrastructure that includes tank storage, rail and truck rack access.
“While we believe the Ferndale Refinery is a strategic fit for this renewable diesel project, permitting uncertainties were leading to delays and higher costs,” Robert Herman, Phillips 66 executive vice president of refining, said in a statement.
The companies did not immediately respond to a request for details on the uncertainties.
Phillips 66, Renewable Energy Group had been expected to make a final investment decision in 2019 on the project, which was announced in 2018.
The companies said on Tuesday they were working to wind down the permitting process.
As MRC wrote before, US-based Phillips 66 remains open to developing another ethane cracker for its Chevron Phillips Chemical (CP Chem) joint venture, the refiner's CEO said in March 2018.
We also remind that in March 2018, Chevron Phillips Chemical Company LP, part of Chevron Corp, successfully introduced feedstock and commenced operations of a new ethane cracker at its Cedar Bayou facility in Baytown, Texas. At peak production, the unit will produce 1.5 million metric tons/3.3 billion lbs. per year.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.
Headquartered in San Ramon, California, Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.
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