Neste to acquire UCO collection, aggregation business from Crimson Renewable Energy
Neste Corp. announced Nov. 17 that it has agreed to acquire the used cooking oil (UCO) collection and aggregation business and related assets in the United States from Crimson Renewable Energy Holdings LLC.
The transaction includes shares in SeQuential Environmental Services LLC and Pure LLC, as well as a UCO processing plant in Salem, Oregon. However, it does not include the biodiesel production facility in Bakersfield, California, Neste told Biobased Diesel Daily.
The deal is subject to the fulfillment of customary closing conditions and regulatory approval.
“This acquisition further strengthens Neste’s presence and operations in the United States,” said Matti Lehmus, president and CEO of Neste. “We continue to execute our renewables growth strategy by expanding our renewable raw materials sourcing platform to the U.S. West Coast, which is also a location for our upcoming renewable diesel production joint operation in Martinez, California, and a key market for serving our customers. Together with Mahoney Environmental, this business will form a nationwide UCO collection and aggregation network. I look forward to welcoming the professional team and high-quality operations to contribute to Neste’s activities in North America.”
Harry Simpson, president and CEO of Crimson Renewable Energy Holdings, added, “I want to thank our SeQuential team for their invaluable efforts and contribution in building a leading UCO collection and aggregation business on the U.S. West Coast. Joining Neste is a great opportunity for that team to develop its UCO business and operations further with a leading manufacturer of renewable fuels.”
Through the transaction, Neste is acquiring a leading UCO collection and recycling business on the West Coast, covering the collection, logistics and storage of UCO in California, Oregon and Washington.
Together with the previous acquisitions of Mahoney Environmental and Agri Trading in the United States, IH Demeter in the Netherlands, and Walco Foods in Ireland, the transaction continues to enhance Neste’s global raw materials sourcing platform and support Neste’s aim to serve the customers with the growing global need for renewable products. Neste currently has a renewable products global production capacity of 3.3 million tons annually.
Neste’s 50/50 joint venture for the production of renewable diesel with Marathon Petroleum—Martinez Renewables in Martinez, California—is expected to begin production in early 2023. Pretreatment capabilities are expected to come online in the second half of 2023, and upon completion, Martinez Renewables is expected to increase Neste’s renewable products capacity by 365 million gallons per year.
Neste’s ongoing Singapore refinery expansion project and Martinez Renewables will increase the total production capacity of renewable products to 5.5 million tons by the end of 2023.
When completed, Neste’s Rotterdam refinery expansion project in the Netherlands will further increase the company’s total production capacity of renewable products to 6.8 million tons by the end of 2026. Crimson Renewable Energy and its SeQuential subsidiaries are the largest producers of ultra-low carbon biodiesel in the western United States and one the largest used cooking oil and grease trap collection companies on the West Coast. Crimson is one of only a handful companies in the U.S. that operates the process from beginning to end on a large scale—collecting used cooking oil and other waste oils, refining it into biodiesel and refueling fleets, fuel stations and various equipment in its local and regional communities.