US corn lobby fumes at RFS waivers for cash-rich oil majors

The US corn lobby said this week it is “extremely troubled” by reports that Chevron and Exxon Mobil – two of the world’s richest companies – have been given exemptions to biofuels obligations that are reserved for small, financially-distressed companies.  

According to a report on Reuters, Chevron and Exxon have asked the US Environmental Protection Agency for waivers for their smallest facilities: Chevron's 54,500 barrel-per-day refinery in Utah and the Exxon's 60,000 bpd refinery in Montana, according to sources.

The EPA is understood to have issued 25 waivers to refineries in the US, riling producers of corn-based ethanol who now face weaker demand because fuel refiners have been freed from obligations from the Renewable Fuel Standard (RFS).

“It’s very alarming what’s going on,” Geoff Cooper of the US Renewable Fuels Association told the AgriTalk radio station.  

He added: “What we’re hearing and what we’re learning over the last few months is that EPA is basically giving these exemptions out to any refiner that’s been asking for them.”

Cooper said that because the waivers had happened retroactively [for years 2016 and 2017], there was little opportunity for ethanol producers to make those volumes up.

“That would be disastrous, if we see three years in a row of billion gallon cuts to the RFS in the form of these back door waivers,” he told the radio programme that has wide audience among the US corn and ethanol industry.

Reuters reported that a spokesman for Chevron had declined to confirm or deny the application of waivers, but acknowledged that waivers gave refiners an edge.

In view of increasing anger from the corn lobby, President Donald Trump said on Thursday that his administration may allow the sale of gasoline containing 15% ethanol, all the year-round, a move that could bolster demand for corn.

 

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