Ron Kotrba
Apr 28, 20222 min
PBF Energy continues to advance its $600 million renewable diesel project at the Chalmette refinery in Louisiana, the company stated in its first-quarter earnings report. The project, located outside New Orleans, involves constructing a new feedstock-pretreatment unit and converting an idled hydrocracker to process up to 840,000 gallons per day of renewable diesel.
PBF Energy invested $40 million in the first quarter “to continue to progress and incubate the project with the goal of being in production in the first half of 2023,” the company stated, adding that it is continuing discussions with potential strategic and financial partners.
According to Eric Young, chief financial officer for PBF Energy, the company has already invested in total roughly $90 million in cash—15 percent of the total project cost—and plans to invest another 15 to 20 percent in the second quarter, he said on an April 28 earnings call. The bulk of the remainder of financing is expected to be funded by a partner, which Matt Lucey, president, said he expects to be shored up in coming months.
“We are committed to bringing in a partner,” Lucey said, adding that the company is evaluating all options, and interest from the market has been “robust.”
“We anticipate startup with full pretreatment capability in the first half of next year,” Lucey said. “Importantly, the project is on time and on budget. We believe our 20,000-barrel-per-day facility is a top-tier project [in terms of] capital costs, operational costs, geographic flexibility, feedstock and product optionality, and time to market. In parallel with the project development, we continue to evaluate a number of different financing alternatives across the capital structure.”
No specific feedstock plans were provided, although executives said on the call that the pretreatment unit will allow PBF Energy to run the most economical material available.
In August, PBF Energy announced it planned to use Ecofining™ process technology jointly developed by Honeywell’s UOP and Eni S.p.A.
“We plan to provide a more fulsome update on the renewable diesel project by mid-summer, one year prior to the anticipated startup of the project,” Young said.