Ron Kotrba
Aug 20, 20212 min
Marathon Petroleum Corp. and Archer Daniels Midland Co. plan to form a joint venture (JV) to own and operate ADM’s previously announced $350 million soy-crush plant in Spiritwood, North Dakota. Under the agreement, ADM will own 75 percent of the JV and Marathon 25 percent. The facility will be capable of processing 150,000 bushels of soybeans a day.
The entirety of the 600 million pounds of refined soybean oil produced at the plant every year will be provided exclusively to Marathon for its renewable diesel operations in Dickinson, North Dakota. Marathon is also planning a refinery-conversion project to make renewable diesel in Martinez, California, at a much larger scale.
In addition to the Spiritwood, North Dakota, partnership, the companies are exploring additional, similar ventures. The new crush plant, which will put out enough soybean oil to manufacture 75 million gallons of renewable diesel a year, is expected to begin operations in time for the 2023 harvest.
“We already provide Marathon with soybean oil for renewable diesel production, but this agreement will significantly expand our collaborative relationship,” said Ken Campbell, an ADM executive. “We believe [renewable diesel demand] may be as much as 5 billion gallons by 2025. And what’s even more exciting is that we see the opportunity to work together to do more to support sustainable solutions.”
Dave Heppner with Marathon said, “This joint venture marks another step in advancing our ability to optimize and source logistically advantaged feedstock for our nearby Dickinson facility, and also creates a platform for further collaboration with a world-class partner as we continue to invest in a sustainable, energy-diverse future.”
The news follows a similar arrangement between Phillips 66 and Shell Rock Soy Processing in Iowa, in which a minority-stake investment by Phillips 66 in the Iowa-based soy-crush project is coupled with an offtake contract for 100 percent of the soy oil produced at the plant.