The Plano, Texas-based company said the hydrotreating expansion will enable the facility to become a full base oils recycling operation, processing Blue Tide produced and additional third party-sourced vacuum gas oil into Group II+ base oils. Once the hydrotreater is operational and the facility redesign is completed, the plant will have 5,000 barrels per day of Group II+ base oil nameplate production capacity, the company said, with the option to upgrade production to Group III in a capital efficient manner.

“We’re going to be making VGO in June of 2023,” Steve Lewis, Blue Tide’s senior vice president for sales and marketing, told Lube Report in a phone interview. “Then we’re going to make base oil, and that production is going to start in February of 2024.”

Lewis said the Baytown facility will use licensed catalyst technology from Topsoe, a Denmark-headquartered global developer and supplier of catalysts and hydroprocessing technologies. The facility’s hydrotreater technology design will be by Sequoia, he added.

Blue Tide’s management team has extensive experienced in the used motor oil recycling and lubricants industries, and Bouldin and Lewis formerly worked at Safety-Kleen. Lewis noted he is on the board of the NORA (An Association of Responsible Recyclers) liquid recycling industry trade association, and that Blue Tide has intimate knowledge and relationships with used oil collectors and all major aggregators in the United States and Canada. The company already has contracts in place with major used oil collection aggregators, he said.

Located along the Cedar Bayou of the Houston Ship Channel, Blue Tide’s facility will also have additional storage, logistics and processing infrastructure planned on the adjacent undeveloped land owned by Blue Tide, as well as a barge dock that provides access to tanker markets along with convenient access to rail and transload facilities.

While the company plans to work extensively with companies in Texas, Lewis noted the Baytown site’s location and infrastructure will provide flexibility to bring used motor oil in from other locations. “We will be barging material down, and we’re going to be bringing material in via rail,” he said. “We’re going to have a pretty long reach, so it’s not going to be only local to Texas.”

Although the company’s focus is on the Baytown facility, Lewis noted Blue Tide is in a growth-oriented mode. “We are looking at different acquisitions and looking at different opportunities to build more plants,” he said.

In April, Blue Tide closed an additional equity commitment from majority owner Tailwater Capital LLC), a Dallas-based private equity firm invests in energy and growth infrastructure solutions, as well as Tailwater co-investors to facilitate the full redevelopment of Blue Tide’s advanced used motor oil recycling plant and the addition of the hydrotreater.