USD Partners begins renewable diesel operations at West Colton, California, terminal

The West Colton terminal (Photo: USD Partners)

USD Partners LP announced Jan. 18 that it has begun renewable diesel operations at its West Colton terminal in California, and the previously announced five-year terminal-services agreement with USD Clean Fuels LLC became effective Dec. 1. This agreement is supported by a minimum-throughput commitment to USDCF from an investment grade-rated refining customer as well as a performance guarantee from US Development Group LLC, the partnership’s sponsor.

USD Partners also announced it has entered into a five-year terminal-services agreement with a minimum monthly throughput commitment with a major ethanol producer at its West Colton terminal, effective Jan. 1. This contract replaces an existing short-term contract at the terminal and is expected to add incremental net cash from operating activities and adjusted EBITDA of approximately $1 million to $1.5 million per year, subject to changes in expected throughput.

“We are excited to announce this renewed long-term partnership at our West Colton terminal,” said Brad Sanders, executive vice president and chief commercial officer for USD. “We believe the extended contract term, combined with the expansion and long-term commitment in renewable diesel handling, speaks to our strategically advantaged portfolio of assets. We are committed to the transition into sustainable fuels and see our USD Clean Fuels business as a strong growth platform for USD and potentially, the partnership. We look forward to future announcements of continued growth within clean fuels.”

USD Partners LP was formed in 2014 to acquire, develop and operate midstream infrastructure and complementary logistics solutions for crude oil, biofuels and other energy-related products.