Phillips 66 Hits Full 120 mgy Rate of Renewable Diesel Production in Rodeo, California

by Ron Kotrba (Biobased Diesel Daily) In its second-quarter financials, Phillips 66 said the hydrotreater conversion at its Rodeo Renewed refinery in California outside of San Francisco reached the full rate of renewable diesel production last month, which is 120 million gallons per year (mgy). The plant is using Haldor Topsoe’s HydroFlex™ process technology.

Permitting for the complete conversion of the refinery to produce 800 mgy is moving forward as planned, the company said. Completion is anticipated for early 2024.

In related news, the company said it is converting 600 branded retail sites in California to sell renewable diesel produced by the Rodeo facility. Phillips 66 also said it plans to release greenhouse gas emission reduction targets later this year. READ MORE

Excerpt from Reuters/Yahoo! Finance: California Bay Area regulators are investigating whether Phillips 66 failed to obtain necessary permits to produce renewable fuels at its oil refinery in Rodeo, according to an email reviewed by Reuters.

Phillips 66 started to process small volumes of soybean oil at the Rodeo refinery in the first quarter of 2021, the company said this year.

The Bay Area Air Quality Management District (BAAQMD), which regulates stationary sources of air pollution in the region, is investigating whether the company modified its refinery without getting required additional permits, according to an email last week seen by Reuters.

Phillips 66 wants the Rodeo project to produce more than 800 million gallons of renewable diesel, renewable gasoline and sustainable jet fuel annually. That effort requires increased use of hydrogen, which can cause flaring events and refineries to malfunction, environmental groups say.

At least 10 groups, including the Natural Resources Defense Council, have complained to regulators about the additional emissions produced by using more hydrogen to treat feedstocks like soybean oil and animal tallow.

Phillips 66 told Reuters it obtained the necessary permits to produce renewable diesel from an existing hydrotreater as part of a standalone flexibility project. The management district declined to comment.

The renewable diesel market is small but growing quickly. The U.S. Energy Department projects it will be about 7% of the overall diesel pool by 2030. Refiners see it as an opportunity to shift to lower-carbon fuels even as electric vehicles become more popular.

Unlike refining petroleum products, producing those fuels requires additional hydrogen to remove oxygen from fats and oils used for making renewable fuels. Groups including the NRDC, the Sunflower Alliance and the Rodeo Citizens Association told regulators they are concerned air emissions at the facility will increase because of this process.

Phillips 66 said it does not need to increase Rodeo's capacity to generate hydrogen, and said estimated emissions from hydrogen generation will be part of Contra Costa County's independent Environmental Impact Report, which is not yet complete. READ MORE