Chevron to Invest in Bunge Soybean Crushers to Secure Renewable Feedstock
Oil major Chevron plans to invest $600 million in two soybean crushing facilities owned by U.S. agricultural commodities trader Bunge Ltd., securing future feedstock for renewable fuels, the two companies said on Sept. 2.
The investment will result in a 50/50 JV, under the memorandum of understanding the two companies said they reached.
U.S. refiners have been ramping up their production of renewable fuels, spurred by federal and state financial incentives, and are seeking to secure guaranteed access to vegetable oils, animal fat and used cooking oil, which some refiners say are already difficult to source.
Chevron would have the right of first refusal for the soybean oil crushed by Bunge, the companies said.
Refiners are eyeing partnerships with agricultural producers to source and process vegetable oils so they can produce green fuels such as renewable diesel. Oil majors want to use their existing crude refineries and avoid costly retrofits and conversions.
Meanwhile, legislation is currently being considered that would make sustainable aviation fuel (SAF) more economically viable to produce at scale. SAF can be three or four times more expensive than making traditional jet fuel.
Unlike other green fuels such as biodiesel, renewable diesel can power auto engines without being blended with diesel derived from crude oil, making it a lower-pollution option.
Sept. 6, 2021