In response to customer demand, the Kramers Lane diesel terminal in Louisville, Ky., owned by Marathon Petroleum Company LLC, will store and blend biodiesel, according to Angelia Graves, director of public and state government affairs. It will be the company's second U.S. terminal to handle the renewable fuel.

Marathon Petroleum will install a 30,000 gallon heated tank and a blending arm to service one lane of the terminal with B2 and B5. "If we have more demand than one lane can cover, we will look at expanding," Graves said.

The company hopes the Louisville terminal will be operating by the end of 2006. At press time, most of the engineering was complete; next, the company will prepare for the equipment acquisition and construction phase. Graves mentioned that these phases are on hold until the funding is finalized.

Graves said engineering, equipment and construction could cost between $500,000 and $1 million. To help with the cost, the company partnered with the Kentucky Clean Fuels Coalition (KCFC) to obtain two federal grants. The Kentucky Soybean Board awarded the company $50,000, and National Clean Cities Inc. in Washington, D.C., gave $36,000, according to the KCFC. The Commonwealth of Kentucky also awarded Marathon Petroleum with a $149,000 grant, which was being finalized at press time.

Marathon Petroleum plans to acquire its biodiesel from biodiesel production facilities in the region. Marathon Petroleum will also "have a product quality procedure in place to ensure that the blended product meets our standards," Graves noted.

The company's first biodiesel blending terminal, located in St. Paul, Minn., was necessary to provide the mandated B2 blend in Minnesota. Graves said the terminal began blending biodiesel in fall 2005.