On Monday, U.S.-listed energy infrastructure giant Kinder Morgan announced a partnership with Finnish renewable energy producer Neste to develop and build a premier domestic raw material storage and logistics hub in Harvey, Louisiana. The new facility will support increased production of renewable diesel, sustainable aviation fuel and renewable feedstock for polymers and chemicals. Upon completion, the new Louisiana site will serve as Neste’s primary storage hub for raw materials including, among other things, the used cooking oil it collects from more than 40,000 restaurants across the United States.
Kinder Morgan will modify existing tanks and piping to enable segregated storage for a variety of raw material across 30 tanks. The scope of work also includes the installation of a new boiler for heating tanks and railcars and infrastructure improvements for rail, truck and marine movements. The project, which is supported by a long-term commercial commitment from Neste, is expected to begin operating in the first quarter of 2023. Neste has the option to further expand the facility.
“This clearly shows the positive role America’s existing energy infrastructure can play in creating a sustainable future and fighting climate change,” said Jeremy Baines, President of Neste U.S. “Neste and Kinder Morgan are transforming existing terminal assets into what can be considered green infrastructure, which will ultimately enable more American businesses and cities to power their fleets and supply chains with renewable fuels and other products.”
The commitment is one of Neste’s largest to date in the U.S., and one that it says supports “a more resilient, flexible and sustainable supply chain that can keep pace with the company’s growing production capacity and increasing global demand for lower-emission products.”
In the long term, the project could also help improve the lifecycle climate benefits and competitiveness of Neste’s renewable products through more efficient and less carbon intensive supply chain operations. Renewable fuels offer an immediate way to reduce greenhouse gas emissions from aviation and heavy duty road transport in the U.S. Neste says its own renewable feedstock for polymers and chemicals manufacturing can also significantly reduce the carbon footprint of end products.
Neste also says its renewable products have prevented the emission of over 40 million tons of new greenhouse gases into the atmosphere over the last five years: climate-equivalent to building 8,300 wind turbines or removing emissions from 10.8 million cars, per the U.S. EPA’s GHG calculator.
Kinder Morgan has a long-standing partnership track record with Neste, which last year began supplying sustainable aviation fuel (SAF) directly to San Francisco International (SFO) Airport via a Kinder Morgan pipeline. More than 1 million gallons of SAF have been supplied into SFO to date.
“We are thrilled to partner with Neste, a global leader in renewable fuels, on this important logistics project. As North America’s largest terminal operator with existing infrastructure including 80 million barrels of storage, 266 docks, 462 truck bays and 6,800 rail car spots, Kinder Morgan Terminals is uniquely positioned to play a leading role in the transition to renewable fuels,” said John Schlosser, president of Kinder Morgan Terminals.
Kinder Morgan says that because renewable products work with existing energy infrastructure, the U.S.’s vast, existing network of pipelines, storage tanks, and distribution sites can be used to rapidly scale their availability. This is a major advantage in accelerating an affordable transition from fossil fuel to renewable products.
Last week, Neste announced that it is acquiring 100 percent of Minnesota-based Agri Trading, one of the largest independent renewable waste and residue fat and oil traders in the U.S. Agri Trading has become an industry leader in trading animal fat waste, used cooking oil, technical corn oil, and other vegetable oils throughout the lower 48 States, Canada, Mexico, and Europe.
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