Marathon Petroleum Corp. (MPC) and Neste Corp. have finalized their previously proposed transaction to become equal partners in MPC’s Martinez Renewable Fuels (MRF) project that, already under way, will transform the now-idled Martinez, Calif., refinery into a renewable fuels production site (OGJ Online, Aug. 3, 2020).
With all required closing conditions met, including receipt of necessary permits and regulatory approvals, MPC and Neste have officially formed Martinez Renewables, a 50-50 joint venture partnership under which Neste joins the MRF with a total investment of $1 billion, inclusive of half the project’s estimated $1.2-billion total development costs through completion, the companies said on Sept. 21.
While MPC will continue to manage project execution and operate the renewables plant, the partners will equally be responsible for feedstock sourcing, as well as evenly share annual production output from the site.
Currently targeted to reach mechanical completion by yearend 2022, the MRF’s first phase is scheduled to begin production of 260 million gal/year of renewable diesel in early 2023, with pretreatment capabilities to come online in second-half 2023.
By yearend, 2023, MPC and Neste said they expect the converted Martinez refinery to reach its full nameplate production capacity of 730 million gal/year.
Finalizing of the partnership follows MPC’s early August announcement it received Bay Area Air Quality Management District’s (BAAQMD) preliminary approval of the MRF’s air quality permit based on the local regulator’s determination that the MRF will comply with all local, state, and federal air quality-related regulations, including health risks resulting from toxic air contaminant emissions (OGJ Online, Aug. 2, 2022).
While BAAQMD’s preliminary recommendation to issue a final permit for the project remained subject to a 30-day public comment period on the draft air permit that ran through Aug. 23, the agency has yet to issue word of its formal permit approval.
