Phillips 66 doubled its production of sustainable aviation fuel (SAF) during the third quarter of 2025 and expects additional increases in production to be realized during the fourth quarter, according to statements made during the company’s third quarter earnings call on Oct. 29.&nbsp;The company’s&nbsp;renewable fuels business segment processes renewable feedstocks into renewable fuels at its Rodeo facility in California and the Humber refinery in the U.K. The segment also includes global activities to procure renewable feedstocks, manage certain regulatory credits and market renewable fuels.&nbsp;Development on the Rodeo Renewable Energy Complex began in mid-2022 and the facility reached full processing rates during the second quarter of 2024.&nbsp;The biorefinery&nbsp;<a href="https://biomassmagazine.com/articles/phillips-66-expects-renewable-diesel-margins-to-improve">began producing SAF</a>&nbsp;in September 2024.&nbsp;According to Phillips 66, the facility has the capacity to produce approximately 50,000 barrels per day (800 MMgy) of renewable fuels.&nbsp;In its third quarter earnings release, Phillips 66 reported that pre-tax results for the renewable fuels segment improved during the third quarter primarily due to higher realized margins, including inventory impacts, as well as higher international credits.&nbsp;The renewable fuels segment reported a $43 million loss before income taxes for the third quarter, an improvement over the $116 million loss reported for the same period of last year. Loss before income taxes awas $361 million for the first nine months of 2025, compared to a $226 million loss for the same period of 2024.&nbsp;The third quarter improvement is primarily attributed to improved margins driven by optimized feedstock volumes and higher international credits, partially offset by unfavorable inventory impacts. The decrease for the first nine months of the year was primarily driven by decreased margins as a result of increased feedstock volumes and unfavorable inventory impacts, partially offset by increased credit production.The company produced 36,000 barrels per day of renewable fuels during the third quarter, down from 44,000 barrels per day produced during the same period of last year. Total renewable fuel sales were 63,000 barrels per day, down from 70,000 barrels per day. For the first nine months of the year, Phillips 66 produced 40,000 barrels per day of renewables, up from 28,000 barrels per day during the same period of 2024, with sales of 66,000 barrels per day, up from 50,000 barrels per day. The company did not break down renewable production and sales volumes by fuel type in its third quarter report.&nbsp;During a third quarter earnings call, Brian Mandell, executive vice president of marketing and commercial at Phillips 66, noted that overall renewable margins were down in the third quarter, but Phillips 66 was able to benefit through various “self-help” measures. “We reduced costs,” he said. “We improved our logistics, particularly to get more domestic feedstock. We sent more of our renewable products to the Pacific Northwest where fossil basis were strong. We got a lot of value from some new pathways we got. We doubled SAF production, and…we had the timing of the European credits.”Moving into the fourth quarter, Mandell said renewables margins are improving with weaker soybean prices and relatively stronger credit values. “We think the industry will continue to run at about the same rates as they did in Q3 given the turnaround activity,” he said. “The European market will continue to attract renewable products. We’ve been sending renewable products in that director, both in Q3 and we continue doing that. We also anticipate continuing to increase our SAF production in Q4, and we’ve seen strong interest from SAF buyers. And finally, the new pathways that I mentioned will give us some additional flexibility.” Despite those market improvements, Mandell stressed the need for more clarity on federal and state policy, including the upcoming Renewable Fuel Standard renewable volume obligations (RVOs) for 2026 and 2027, the EPA’s small refinery exemption (SRE) reallocation proposal, and the use of foreign feedstocks. He also said additional clarity is needed with regard to European policies. &nbsp;

2025-10-29 - Phillips 66 doubles SAF production in Q3 (3 publications)

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Phillips 66 doubled its production of SAF during the Q3 and expects additional increases in production to be realized in Q4, according to statements made during the company’s third quarter earnings call on Oct. 29. 

Phillips 66 doubles SAF production in Q3

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