Valero Energy Corporation (NYSE:VLO) Q2 2023 Earnings Call Transcript

A – Lane Riggs: Yes. I think — yes, that’s a lot of questions there. Well, what I would say is — so the first question of is there a pathway to take ethanol into jet fuel. The answer is yes, post sequestration. That is — it does allow ethanol to become a viable feedstock into that market. It’s way too early to talk about numbers and capital and all of that from a from a project standpoint. But if you look at it from the airline standpoint, they do see that the first barrel of SAF that they will get ratably will be RD based. There is — as that conversion goes through the RD markets, the next barrel could be from an ethanol source. But that’s like you said, that’s much further out there on the time line. So yes, and then if you look at in terms of — is the technology there?

And is there a capability there and will airlines differentiate between the two? Again, probably too soon to tell. But from a fuel standpoint, there’s no difference between an ethanol-based barrel versus an RD based barrel from a SAF standpoint. But a lot of work to be done first on how RD will price SAF into the market, and then these are all much, much further down the time line.

Q – Matthew Blair: Understood. Thanks for your comments.

Operator: Thank you. At this time, I’d like to turn the floor back over to Mr. Bhullar for closing comments.

Homer Bhullar: Thanks, Donna. I appreciate everyone joining us today, and please feel free to contact the IR team if you have any follow-up questions. Have a great day. Thanks, everyone.

Operator: Ladies and gentlemen, thank you for your participation. This concludes today’s event. You may disconnect your lines at this time and enjoy the rest of your day.