Energy producer Chevron plans to invest $600 million in two soybean crushing facilities owned by Bunge Ltd., securing future feedstock for renewable fuels, the two companies said Thursday, according to a Reutersreport.
The investment will result in a 50/50 joint venture, 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.
Chevron and Bunge's proposed joint venture will include expanding Bunge's facilities in Destrehan, Louisiana, and Cairo, Illinois, to nearly double their capacity by 2024.
The facilities currently crush 7,000 tons of soybeans per day, which can produce roughly 330,000 to 340,000 gallons of soy-based diesel.
To read the full Reuters report, click here.
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