Montana Renewables Announces Timing Update for DOE Loan Facility

January 30, 2025

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(Calumet/PR Newswire) Calumet, Inc. (NASDAQ: CLMT) ("Calumet," the "Company," "we," "our" or "us") has been informed by the U.S. Department of Energy ("DOE") Loan Programs Office ("LPO") that the first tranche of approximately $782 million under the guaranteed loan facility that was previously approved for funding today, January 28, will undergo a tactical delay to confirm alignment with White House priorities. The loan facility, which closed on January 10, will fund the construction and expansion of the renewable fuels facility in Great Falls, Montana, owned by Montana Renewables, LLC ("Montana Renewables" or "MRL"), an unrestricted subsidiary of Calumet. The Company was informed that the delay should be days or weeks.

"We are well aligned with White House priorities to support domestic agriculture, energy security, technical innovation and energy independence, all of which play a role in the tremendous bipartisan support this loan has received since its inception," said Todd Borgmann, CEO of Calumet. "The recently issued Executive Order specifically highlights the importance of biofuels to our nation's domestic energy policy and energy independence, and we look forward to a quick review confirming that we are aligned with the Administration's goals."

Regional Development

An economic impact study1 produced by the University of Montana Bureau of Business and Economic Research (BBER) measured the substantial benefit to Montana in the form of jobs, income, government revenues, economic output and population. For example, by 2028, the economic footprint of the Great Falls site is expected to support a population of 4,400 Montanans, consisting primarily of working-aged families and their children.

MRL expects the expansion to catalyze additional regional development, particularly for renewable feedstocks sourced from farms and ranches. By driving local infrastructure development in transportation, agricultural and energy related businesses similar to the Minnesota SAF Hub, MRL will create a large-scale, end-to-end SAF industry comprised of public and private partners in Montana and the Pacific Northwest.

The MRL expansion is expected to create 450 construction jobs and up to 40 operations jobs.

About Montana Renewables
Montana Renewables is a leading renewable fuel company located in Great Falls, Montana. MRL produces Sustainable Aviation Fuel, Renewable Diesel, Renewable Hydrogen and Renewable Naphtha. As the largest SAF producer in North America (2024), MRL is dedicated to meeting the increasing demand for sustainable fuels and to supporting a greener future. As a Great Falls business leader, MRL offers high-paying jobs and career opportunities while supporting the local economy and contributing to the community's overall well-being. Pacific Northwest farm and ranch operations ultimately provide MRL with sustainable, renewable, low-carbon feedstocks and agricultural byproducts including tallow, distillers corn oil, canola oil, used cooking oil and camelina oil. These feedstocks are converted to renewable transportation fuels which have lower emissions compared to conventional fossil fuels. MRL is an unrestricted subsidiary of Calumet, Inc.

About Calumet
Calumet, Inc. (NASDAQ: CLMT) manufactures, formulates, and markets a diversified slate of specialty branded products and renewable fuels to customers across a broad range of consumer-facing and industrial markets. Calumet is headquartered in Indianapolis, Indiana and operates twelve facilities throughout North America. READ MORE

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Excerpt from Washington Post: Donald Trump has frozen billions of dollars in Energy Department loans for clean energy projects. But on Feb. 7, he quietly blessed one deal cut in the final days of Joe Biden’s presidency: a $782 million loan guarantee to a company expanding a biofuels plant in Great Falls, Montana.

Montana Renewables, which makes jet fuel and diesel out of plant oils, beef tallow and other waste fats, signed a $1.67 billion loan deal with the Energy Department on Jan. 10 as part of a flurry of nearly $50 billion in loans the Energy Department closed in the last two months of Biden’s term.

Like other Energy Department loan recipients — which borrowed money to fund everything from solar panel factories to lithium mines — Montana Renewables saw its loan frozen after Trump took office and vowed to cut back clean energy projects. On Jan. 28, when Montana Renewables was supposed to get the first half of its money, the Energy Department had held up the cash “to confirm alignment with White House priorities,” the company said.

Two weeks later, Montana Renewables became the first company to get its Energy loan money under Trump. The Energy Department is still reviewing other companies’ loans “to ensure all activities are consistent with the law and in accordance with President Trump’s executive orders and priorities,” an Energy Department spokesperson said.

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Like many clean energy executives in the Trump era, Fleming downplayed the project’s connection to climate change. He said the project would benefit Western farmers and cattle ranchers and improve U.S. energy security in line with Trump’s priorities. He added that the company applied for its loan before Biden signed the Inflation Reduction Act, his landmark climate bill, in 2022.

“This is not the Green New Deal,” Fleming said. “So once that was clear to everybody, I think we’re an example of what [the Trump administration] do want to support.”

...

Most projects that have gotten Energy Department loans are in states represented by Republican lawmakers. Montana Renewables had bipartisan support from former Democratic senator Jon Tester, who lost his recent reelection bid, and Republican Sen. Steve Daines, who urged Trump and Energy Department officials to approve the project.

“I am glad to see that President Trump’s DOE is focused on bolstering Made-In-America energy and I’ll continue to fight for more ways to support Montana’s mining and energy industries,” Daines wrote in a statement.

Executives at other companies vying for DOE loans believe that some of their projects may get axed under Trump.

“I’m sure they’ll find something where they go, ‘No, I think not,’” said Pat Gruber, CEO of Gevo, a biofuels and chemicals company that’s waiting for the Trump administration to sign off on a $1.46 billion loan guarantee to finance a South Dakota factory that will turn corn starch into jet fuel.

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Jigar Shah, the Biden-appointed LPO director who recruited many staffers from the private sector, left the office shortly after Trump’s inauguration. If many staffers join him, it may be difficult for the office to monitor and disburse the roughly $100 billion in closed loans for ongoing projects and vet the current backlog of applications for more than $200 billion in new loans. READ MORE

Excerpt from SAF Magazine: The DOE loan guarantee is structured in two tranches. The first tranche of approximately $782 million will fund eligible expenses previously incurred by Montana Renewables. Simultaneous with the first tranche funding, Calumet made an additional $150 million equity investment with cash on hand. The balance of the guaranteed loan proceeds of up to approximately $658 million is expected to be disbursed through a delayed draw construction facility, and Montana Renewables expects this second tranche to be disbursed during construction beginning in 2025 through the anticipated completion of the MaxSAF project in 2028. Disbursements under the guaranteed loan facility are subject to the satisfaction of certain commercial, technical, and legal conditions precedent. During construction, retained earnings from Montana Renewables are expected to supplement DOE funds to maintain debt at 55% of capitalization during the MaxSAF construction sequence. The loan has a 15-year tenor and an annual interest rate at the U.S. Treasury rate plus 3/8%. Servicing of principal and interest will be deferred until MaxSAF is commissioned.

An economic impact study produced by the University of Montana Bureau of Business and Economic Research predicts the economic impact of the project at the Great Falls site is expected to support a population of 4,400 Montanans. Montana Renewables said it expects MaxSAF initiative to catalyze regional development, particularly for feedstock production. The expansion project is also expected to create 450 temporary construction jobs and 40 permanent operations jobs. READ MORE