Delek US Holdings has agreed to pay about $5 million for a Dallas-area biodiesel plant that has been supplying its Texas refinery.
The agreement between Brentwood-based Delek and Cincinnati-headquartered EQM Technologies & Energy is expected to close later this month. A unit of Delek has since late 2011 been supplying EQM's Cleburne, Texas, facility with feedstock and then transporting the biodiesel to its refinery in Tyler about 140 miles east. That tolling agreement between the two parties, which accounted for all of the plant's production, will end with the acquisition's closing.
Delek is required by the Environmental Protection Agency to blend increasing amounts of biofuels into its products — the requirement was 9 percent in 2012 — and the Tyler refinery began blending biodiesel in June 2011. Delek officials have been investing in various refinery and terminal projects with the aim of growing the company's biodiesel and ethanol capacity.
The Cleburne plant, which processes animal fats into fuel, launched full-scale operations in May of 2007 but was shut down in March 2010 after the expiration of a biodiesel tax credit changed the industry's economics. The facility has a production capacity of 12 million gallons per year.
Shares of Delek (Ticker: DK) were changing hands late Friday morning at $26, up slightly on the day. They're up 40 percent in the past six months.