Valero Energy Corporation and Darling Ingredients Inc. are in discussions to build a new plant in Port Arthur, Texas.
The proposed facility under review would be designed to produce 400 million gallons of renewable diesel annually as well as 40 million gallons of renewable naphtha. The new plant would be owned and operated by Diamond Green Diesel Holdings LLC, the 50/50 joint venture between Valero and Darling.
The proposed Port Arthur plant would be the first renewable diesel facility in Texas and would be in a location to leverage Valero’s existing refinery. The production from this new plant would increase DGD’s annual renewable diesel production to approximately 1.1 billion gallons with nearly 100 million gallons of renewable naphtha production.
The final investment decision on the project is expected in 2021, subject to further engineering, obtaining necessary permits, and approval by the boards of Valero and Darling. If the decision is made to move forward, new plant construction could begin in 2021, with expected operations commencing in 2024.
“We expect low-carbon fuel mandates across the globe to continue to drive demand growth for renewable fuels,” said Joe Gorder, Valero Chairman, President and Chief Executive Officer. “This project would meaningfully expand our renewable diesel segment, which continues to generate strong results, and demonstrates our commitment to environmentally responsible operations.”
DGD’s future total annual capacity of 1.1 billion gallons of renewable diesel and nearly 100 million gallons of renewable naphtha includes production from DGD’s Louisiana plant, which is currently being expanded to produce 675 million gallons of renewable diesel and 60 million gallons of naphtha. The Louisiana expansion is targeted for completion at the end of 2021.