Chevron USA Inc., a subsidiary of integrated energy firm Chevron Corp., and agribusiness Bunge recently signed a memorandum of understanding (MOU) for a proposed 50/50 joint venture focused on renewable fuels production, the companies announced in release this month.
Chevron said it will contribute $600 million in cash to support the joint venture if the plan moves forward, and Bunge intends to provide its soybean processing plants in Destrehan, LA and Cairo, IL. The joint venture would double the capacity of the two locations from 7,000 tn/day by 2024.
“As the world’s largest oilseed processor, we are pleased to expand our partnership with an energy industry leader to increase our participation in the development of next generation, renewable fuels,” Greg Heckman, CEO of Bunge, said in a release. “Together, we share a commitment to sustainability and reducing carbon in the energy value chain. This relationship with Chevron would enable Bunge to better serve our farmer customers by accessing demand in the growing renewable fuels sector.”
The Louisiana and Illinois facilities will continue to be operated by Bunge. Chevron secured offtake rights to the oil for use as a renewable feedstock for the production of diesel and jet fuel with lower lifecycle carbon intensity.
“Through our commercial work with Bunge, we have come to appreciate their strong company culture, their strategic desire to advance the production of lower carbon fuels, their commitment to capital discipline and promotion of sustainable agriculture in their supply chains,” said Mark Nelson, executive vice president, Downstream & Chemicals for Chevron, in a statement. “Chevron’s proposed joint venture with Bunge positions us to expand into the renewable fuel feedstock value chain, which will advance our higher returns, lower carbon strategy.”