Calumet provides operational update on Montana Renewables
Calumet Specialty Products Partners provided a second-quarter update July 10 on Montana Renewables.
Ramp-up of unit operations was completed during the second quarter, making Montana Renewables the largest producer of sustainable aviation fuel (SAF) in North America, the company stated.
“The Montana Renewables team delivered on our first-mover strategy and quickly adapted to our new processing capabilities,” said Todd Borgmann, Calumet CEO. “We worked through the expected new equipment teething problems at an excellent pace, and we enter the next quarter on track to demonstrate the steady-state earnings power of this business.”
The second quarter also delivered an industry first with the successful startup of Montana Renewables’ feedstock-pretreatment technology by Applied Research Associates.
“Commissioning and ramp-up of our next-generation pretreater was a carefully calculated decision that paid off, with the industry watching as serial No. 1 of the ARA continuous process performed as planned,” said Bruce Fleming, CEO of Montana Renewables and executive vice president of corporate development. “This fully unlocks the huge feedstock optionality that comes with our advantaged location.”
Montana Renewables enters the third quarter running 12,500 barrels per day (bpd) of renewable feedstock.
Approximately 50 percent of renewable diesel production is currently being sold into Canada.
All of the SAF is being delivered to Shell Aviation.
And the unique renewable hydrogen plant capacity was demonstrated.
Feedstock mix is presently 8,000 bpd untreated and 4,500 bpd of treated safety stock as Montana Renewables’ rotates from clean to dirty inventory.
“With these milestones met, we have demonstrated untreated EBITDA of $1.25 to $1.45 per gallon and confirmed top-tier status given Montana Renewables’ unique advantages of preferred location, better technology and higher margins,” Fleming said.
The planned hydraulic expansion and MaxSAF developments both continue, the company said, as Montana Renewables strategically seeks to grow its first-mover position in the rapidly accelerating SAF market.
Funding discussions with U.S. DOE are ongoing, the company stated.
“Our Montana Renewables monetization strategy remains on track,” Borgmann said. “With proven operations and a tangible growth strategy, the appeal of Montana Renewables to potential investors, including the public market, continues to grow. This combination of expected strong cash flows and a path to potential monetization leaves Calumet well positioned to achieve its strategic objectives of permanently de-levering the business and unlocking value for our unit holders.”
