Italy’s Eni enters growing US biofuels market through renewable diesel joint venture with PBF Energy
Italy-based Eni Sustainable Mobility and PBF Energy Inc. announced Feb. 16 they have entered into definitive agreements to partner in a 50/50 joint venture, St. Bernard Renewables LLC, for the biorefinery currently under construction co-located with PBF’s Chalmette Refinery in Louisiana.
Upon consummation of the transaction, which is subject to customary closing conditions, including regulatory approvals, Eni Sustainable Mobility will contribute capital totaling $835 million plus up to additional $50 million that is subject to the achievement of eventual project milestones and will provide expertise in biorefining operations, supply and marketing.
PBF brings its strong industrial know-how in the United States and, as the contributor of the biorefinery, will continue to manage project execution and serve as the operator once construction is complete.
The St. Bernard Renewables biorefinery startup is scheduled in the first half of 2023 and the facility is currently targeted to have processing capacity of about 1.1 million metric tons per year of raw materials, with full pretreatment capabilities.
It will produce mainly renewable diesel, also referred to as hydrotreated vegetable oil (HVO) with a production capacity of 306 million gallons per year.
The biorefinery will use the Ecofining™ process developed by Eni in cooperation with Honeywell UOP.
This strategic partnership will leverage the experience and expertise of Eni Sustainable Mobility and PBF.
Together with Ecofining™ technology, Eni brings its experience in biorefining that led to the world’s first conversion of a refinery into a biorefinery in Porto Marghera in Venice, Italy, in 2014, and to the second converted biorefinery that has been working in Gela, Sicily, since 2019.
The company also provides its worldwide knowledge in supplying sustainable feedstock sourcing for HVO, mainly based on oily waste and residues, and raw materials that do not compete with the food chain, coupled with access to international markets beyond PBF’s footprint in the United States.
PBF brings experience in large-capital project execution and fuels manufacturing as well as access to the California renewables market through its existing logistics assets.
The joint venture reflects both partners’ commitment to deliver more sustainable transportation fuels using low carbon-intensity feedstocks.
“Joining St. Bernard Renewables biorefinery project enables Eni to enter into the U.S.’s growing biofuels market together with a strong partner such as PBF,” said Stefano Ballista, CEO of Eni Sustainable Mobility. “This is a further step for Eni Sustainable Mobility to expand its biorefining capacity, that today is over 1 million tons per year, and it is planned to grow in the upcoming years. Following results achieved in Venice and Gela, Eni Sustainable Mobility is a pioneer in the biorefining industry, and it is also studying possible construction of two new biorefineries in Italy and Malaysia. We do believe the role of HVO will strongly contribute to decarbonization of road transports, including the hard-to-abate heavy-duty sector, as it leverages existing infrastructure and can immediately fuel existing vehicle fleets. Biofuels are part of Eni’s strategy to achieve carbon neutrality by 2050 through the reduction of the emissions generated during the entire product lifecycle.”
PBF President Matthew Lucey added, “We’re excited to enter this strategic partnership with Eni Sustainable Mobility, a global leader in biorefining. The SBR biorefinery will benefit greatly from PBF and Eni’s complementary strengths and expertise. The project will utilize existing processing infrastructure and diverse inbound and outbound logistics and is ideally situated to support growing demand for low-carbon fuels. Our partnership with Eni signals a major milestone for PBF and demonstrates our commitment to contributing diversified sources of energy to the global mix while lowering the carbon intensity of our operations and the products we manufacture.”
SBR will operate as an independent entity with feed procurement and product distribution managed by a dedicated team working on behalf of the St. Bernard Renewables joint venture.
While the partnership is set to benefit from its co-location with PBF’s Chalmette refinery through a variety of shared services, the operations and ownership of the Chalmette refinery will not be affected by the formation of the partnership.
Citi is serving as financial advisor to PBF Energy.
