US Marathon’s Martinez refinery on track to produce renewable fuels in H2 2022

Author: Adam Yanelli

2021/05/04

HOUSTON (ICIS)--US refiner Marathon Petroleum is on track to reach its Phase 1 target of producing 17,000 bbl/day of renewable diesel from its converted Martinez, California, refinery by the second half of 2022, executives said on Tuesday during an earnings conference call.

The facility will produce renewable diesel from bio-based feedstocks such as animal fat, soybean oil and corn oil and will have a capacity of 48,000 bbl/day once the project is completed in the second half of 2023.

The company has also completed the conversion of its Dickerson, North Dakota, facility and is in the start-up process.

Ray Brooks, executive vice president of refining, said engineering for the conversion of the Martinez facility is nearly complete and progress has been made on submitting environmental reports.

The exact cost of the conversion is not clear, but Marathon budgeted $350m for capital expenditures (capex) in its 2021 budget.

No commercial partner has been named for the project, but Marathon CEO Michael Hennigan said there are a number of commercial negotiations under way with a wide range of suppliers.

“We have been leveraging our existing capabilities and relationships because we have been buying the feedstocks for a period of time for our existing biodiesel and now more recently for Dickerson,” he said.

David Heppner, senior vice president of strategy and business development, said the company is considering where they can do more with partners than just commercial arrangements, but they still need to let discussions play out.

“As we build out our feedstock procurement strategy and create more options, we are certainly looking at partners along the entire value chain, from the procurement of feedstock onwards,” Heppner said.