Valero Energy Corp. on Jan. 30 released fourth quarter financial results, reporting that both its ethanol and renewable diesel segments were profitable during the period. The company also announced that its sustainable aviation fuel (SAF) project in Texas is fully operational.
During an earnings call, Valero President and CEO Lane Riggs said the company set a record for ethanol production during the quarter with the expansion of its plant in Charles City, Iowa, and process optimization at other sites. “Our team’s relentless focus on operational excellence and low-cost operations enabled us to deliver positive results in the fourth quarter in an otherwise weak margin environment,” he said.
Valero’s ethanol segment produced an average of 4.6 million gallons per day during the fourth quarter. The segment reported operating income of $20 million, down from $190 million during the same period of 2023. Production is currently expected to remain at 4.6 million gallons per day during the first quarter of 2025, according to Valero Vice President of Investor Relations and Finance Homer Bhullar.
The company’s renewable diesel segment, which consists of the Diamond Green Diesel joint venture, sold approximately 3.4 million gallons per day during the fourth quarter. The segment reported fourth quarter operating income of $170 million, up from $84 million during the third quarter of 2023. According to Bhullar, renewable diesel sales volumes are expected to reach 1.2 billion gallons this year.
The SAF project at the DGD Port Arthur plant in Texas was successfully completed during the fourth quarter, and is now fully operational. The project gives the plant optionality to upgrade approximately 50% of its current 470 MMgy production capacity to SAF.
Eric Fischer, senior vice president of product supply, trading and wholesale at Valero, explained that the SAF project was finished ahead of schedule and under budget. “We had a flawless startup—it started on spec,” he added. According to Fischer, production has been smooth and the company sold its first volumes of SAF in November. He declined to speculate on expected SAF production volumes for 2025, noting the company has very good flexibility and that current economics for HVO renewable diesel are at or better than SAF. Fischer also indicated that SAF demand is expected to pick up in the first quarter as European mandates come into force.
Overall, Valero reported net income attributable to Valero stockholders of $281 million, or 88 cents per share, for the fourth quarter of 2024, compared to $1.2 billion, or $3.55 per share, for the fourth quarter of 2023. For the full year 2024, net income attributable to Valero stockholders was $2.8 billion, or $8.58 per share, compared to $8.8 billion, or $24.92 per share, in 2023.
