PBF Energy expects renewable diesel production, economics to improve in Q4
October 31, 2024
BY Erin Voegele
PBF Energy Inc. on Oct. 31 announced that its St. Bernard Renewables facility produced 13,000 barrels per day of renewable diesel during the third quarter. Production is expected to increase during the fourth quarter.
The company previously announced SBR produced 16,500 barrels per day during the second quarter of this year. The lower third quarter production was partly attributed to a catalyst change that began in late July and was completed in August. Moving into the fourth quarter, PBF Energy expects SBR production to average approximately 16,000 to 17,000 barrels per day.
The SBR biorefinery is co-located at PBF Energy’s Chalmette oil refinery in Louisiana. The 320 MMgy facility primarily produces renewable diesel and is jointly owned by PBF Energy and Eni Sustainable Mobility Spa. PBF and Eni closed on the 50-50 partnership in St. Bernard Renewables in mid-2023. The SBR facility’s renewable diesel unit began operations in June 2023, and a feedstock pretreatment unit was brought online the following month. Eni In October announced an agreement to sell a 25% stake in its Enilive business to U.K. based KKR. Eni’s ownership share in SBR is among the assets held by its Enilive business.
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Karin Davis, chief financial officer at PBF Energy, noted the company reported a third quarter adjusted net loss of $1.50 per share and adjusted EBITDA loss of $60.1 million. Included in those results is a $29 million loss related to PBF’s equity investment in SBR.
Company officials, however, expect economics in the renewable diesel market to improve in the near-term. Paul Davis, senior vice president of supply, trading and optimization at PBF Energy, noted that renewable diesel imports are expected to decline as the current blender tax credit for biobased diesel expires at the end of the year.
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Matthew Lucey, president and CEO of PBF Energy, said the market for renewable diesel has been shaking out. He said government incentives for renewable diesel are expected to continue. The SBR biorefinery is well positioned to as a renewable diesel producer due to its feedstock pretreatment capabilities and location, he added. Those advantages are not translating into profits during the current year, but Lucey indicated the market is dynamic and will continue to shake out with some producers shifting to sustainable aviation fuel (SAF) and some biodiesel producers exiting the market.
Lucey stressed that the partnership with Italy-based Eni has been very strong and he is highly confident that SBR’s offering of renewable diesel is as competitive as it needs to be. There always pluses and minuses when you start a new business, he said, explaining that the minuses experienced by SBR have been shared by others in the industry. Lucey specifically noted the facility has been impacted by underperforming catalyst. He said the company has found there needs to be a bit more maintenance in terms of catalyst changes and shorter cycles, but expressed confidence that engineers will continue to line that out and make improvements.
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