Exxon, Chevron want to produce renewable fuels

US oil major Exxon Mobil Corp, along with Chevron Corp, is seeking to bulk up in the burgeoning renewable fuels space by finding ways to make such products at existing facilities, sources familiar with the efforts said.

The two largest US oil companies want to produce sustainable fuels without ponying up billions of dollars that some refineries are spending to reconfigure operations to make such products. Renewable fuels account for 5 per cent of US fuel consumption, but are poised to grow as various sectors adapt to cut overall carbon emissions to combat global climate change.

Both Chevron and Exxon have massive refining divisions that contribute heavily to their overall carbon emissions. The companies have been criticized for a less urgent approach to renewable investments than European rivals Royal Dutch Shell Plc and TotalEnergies, and have generally spent a lower percentage of their capital than those companies on “green” technologies.

The companies are looking into how to process bio-based feedstocks like vegetable oils and partially-processed biofuels with petroleum distillates to make renewable diesel, sustainable aviation fuel (SAF) and renewable gasoline, without meaningfully increasing capital spending.

Commercial production of renewable fuels is costlier than making conventional motor gasoline unless coupled with tax credits.

A task force was created at Exxon’s request within international standards and testing organization ASTM International to determine the capability of refiners to co-process up to 50% of certain types of bio-feedstocks to produce SAF, according to the sources.

Chevron is looking into how to run those feedstocks through their fluid catalytic crackers (FCC), gasoline-producing units that are generally the largest component of refining facilities.

“Our goal is to co-process biofeedstocks in the FCC by the end of 2021,” a Chevron spokesperson told Reuters, to supply renewable products to consumers in Southern California.