Oleochem Analytics – Chevron and Bunge announced September 2 a memorandum of understanding (MOU) of a proposed 50/50 Joint Venture (JV) to help meet the demand for renewable fuels and to develop lower carbon intensity feedstocks.
Upon finalization of the joint venture, Chevron and Bunge’s partnership would establish a reliable supply chain from farmer to fuelling station for both companies, a new release from the companies said.
Bunge is expected to contribute its soybean processing facilities in Destrehan, Louisiana, and Cairo, Illinois, and Chevron is expected to contribute approximately $600 million in cash to the JV.
Under the proposed JV arrangement, Bunge will continue to operate the facilities and Chevron would have offtake rights for the soybean oil to manufacture biofuels like renewable diesel and sustainable aviation fuel.
Through the joint venture, the two companies anticipate approximately doubling the combined capacity of the facilities from the current 7,000 tons/day by the end of 2024. The JV would also pursue new growth opportunities in lower carbon intensity feedstocks, as well as consider feedstock pretreatment investments, according to the companies.
“This relationship with Chevron would enable Bunge to better serve our farmer customers by accessing demand in the growing renewable fuels sector,” said Greg Heckman, Bunge CEO.
The companies stated that the creation of the proposed JV is subject to the negotiation of definitive agreements with customary closing conditions, including regulatory approval.