UPDATE 2-EPA 2018 biofuels targets slightly higher -source

(Adds new sourcing, reaction)

Nov 30 (Reuters) - The U.S. Environmental Protection Agency will require fuel companies to blend 19.29 billion gallons of renewable fuels into the nation's fuel supply in 2018, up slightly from the 19.28 billion gallons required for 2017, a source briefed on the matter told Reuters on Thursday.

That will include 15 billion gallons of conventional biofuels like corn-based ethanol, in line with 2017, and 4.29 billion gallons of so-called advanced biofuels, up from 4.28 billion in 2017, according to source, who asked not to be named.

For 2019, the EPA set a target for biodiesel at 2.1 billion gallons, unchanged from 2018, according to the source.

The targets would adhere to the EPAs proposal made in July for both conventional biofuels and biodiesel, but reverses a proposal to slightly reduce total advanced volumes to 4.24 billion gallons in 2018, which drew pushback from the industry.

The EPA, which is required to set the volumes targets on Thursday, did not immediately comment.

Bloomberg was first to report the figures, citing an unnamed EPA official.

U.S. Senator Chuck Grassley of Iowa, a vocal supporter of the biofuels industry, said he was disappointed by the EPA targets, particularly the lack of an increase for biodiesel levels in 2019.

"The EPAs announced renewable volume obligations fall short of the full potential of the U.S. biofuels industry," he said in a statement.

The U.S. Renewable Fuels Standard requires refiners to blend increasing amounts of biofuels into gasoline and diesel every year, as a way to boost U.S. agriculture, slash energy imports, and cut emissions.

The law, introduced more than a decade ago by then-President George W. Bush, has been a boon to the corn belt, but has angered the oil industry, which sees biofuels as competition and which has been burdened with the costly responsibility of blending the fuels.

After consultations with the oil industry, the EPA had opened the door to cuts to the biofuels volumes targets, but eventually backed off under heavy pressure from Midwest lawmakers. (Reporting by Jarrett Renshaw and Richard Valdmanis; Editing by Chizu Nomiyama and Andrew Hay)