USA BioEnergy secures long-term feedstock supply for $2.8 billion SAF project in Texas

USA BioEnergy announced June 9 that it has signed a letter of intent with LP Building Solutions outlining the parties’ plans to enter a long-term supply agreement for sustainably sourced wood fiber to support operations at USA BioEnergy’s planned Texas Renewable Fuels biorefinery in Bon Wier, Texas.

The advanced biorefinery will require raw wood feedstocks for the production of renewable fuel.

Once finalized, the agreement would provide for up to 2.2 million tons of woody biomass annually for an initial term of 20 years.

This advanced biorefinery will convert forest thinnings into sustainable aviation fuel (SAF) and other renewable fuels.

With more than five decades of experience in forestry and timber operations in East Texas, LP is expected to serve as the exclusive procurement agent for Texas Renewable Fuels under the future agreement, leveraging its regional expertise to source feedstock responsibly and sustainably.

“LP is proud to bring our deep roots in sustainable forestry to support the Texas Renewable Fuels project,” said Steven Meadows, LP’s natural resources manager. “Our longstanding commitment to responsible resource management is well aligned with USA BioEnergy’s vision for sustainable fuel production. We look forward to advancing this effort, which benefits the regional economy, promotes environmental stewardship and advances the clean-fuels industry.”

All biomass sourced under this agreement will meet stringent sustainability standards and will be verified through independent third-party audits and certifications.

“This agreement is a key milestone for our Bon Wier project,” said USA BioEnergy CEO Nick Andrews. “Long-term, bankable feedstock supply is essential to securing favorable project financing. Working with a trusted, reputable company like LP helps us align the term of our supply agreement with our debt, which is critical to lowering our cost of capital. This collaboration underscores the strength of our commercial partnerships and our commitment to delivering sustainable, American-made fuels.”

In January, USA BioEnergy closed on the acquisition of over 1,600 acres of land in East Texas for its new $2.8 billion advanced biorefinery designed to convert wood waste into sustainable, net-zero sustainable aviation fuel (SAF).

The planned greenfield facility is currently in detailed design and engineering and aims to address airlines’ growing demand for SAF by converting sustainably sourced forest thinnings into SAF.

The landmark SAF facility has secured a 20-year offtake agreement with Southwest Airlines.

After the engineering and design process is completed, construction of the biorefinery is expected to take approximately two years, followed by a six- to eight-month commissioning period. 

The facility will annually convert 1 million tons of sustainably sourced woody waste into 65 million gallons of net-zero transportation fuel, including SAF and renewable naphtha.

The plant will also capture and sequester over 50 million metric tons of carbon dioxide over the biorefinery’s lifetime.  

The project is receiving support from state, county and federal credits and tax incentives totaling approximately $150 million.