Montana Renewables Receives First Drawdown from $1.44 Billion DOE Loan Facility

• Initial loan proceeds of $782 million funded today
  
• Balance of proceeds to be funded during planned expansion from 2025 through 2028
  
• DOE loan guarantee facilitates expansion of Sustainable Aviation Fuel capacity to 300 million gallons per year
  

INDIANAPOLIS, Feb. 18, 2025 /PRNewswire/ -- Calumet, Inc. (NASDAQ: CLMT) ("Calumet," "we," "our" or "us") announced today that Montana Renewables, LLC, an unrestricted subsidiary of Calumet ("Montana Renewables" or "MRL"), has received its first drawdown of approximately $782 million from its $1.44 billion guaranteed loan facility with the U.S. Department of Energy ("DOE") Loan Programs Office ("LPO"). The loan funds the construction and expansion of the renewable fuels facility owned by Montana Renewables.

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The expansion positions Montana Renewables as one of the largest Sustainable Aviation Fuel (SAF) producers globally, enabling an increase in annual production capacity to approximately 300 million gallons of SAF and 330 million gallons of combined SAF and renewable diesel (RD). The planned expansion includes several key modular components, which will provide the ability to increase capacity and reduce costs. The most important component is a second renewable fuels reactor, which will allow approximately half of the 300-million-gallon SAF capability to be online by 2026.

"DOE's mission includes technology and domestic energy security. MRL delivers both," said Bruce Fleming, CEO Montana Renewables. "Over the past three years DOE's Loan Program Office conducted a rigorous due diligence process supported by experts in technology, markets, law, underwriting, and risk, and MRL qualified on the merits. The incoming administration took time to verify this and we appreciate the office's thoroughness. Today we are pleased to continue leading Montana's largest biofuels investment and look forward to our continued collaboration with the LPO on the success of this project."

"Montana Renewables has been at the cutting edge of a rapidly developing biofuels market since its inception," said Todd Borgmann, CEO of Calumet. "MRL proved itself as an early mover in large scale SAF production, and now we are proud to be the first project to receive the support of our new Administration. I thank the entire DOE team for its continued commitment to supporting this practical and rapidly growing form of aviation fuel and for taking the time to ensure our nation's investments are prudent ones. The expansion of Montana Renewables into one of the world's largest SAF producers is an exceptional opportunity for regional agriculture, Montana business development, our employees and our shareholders."

Loan Guarantee Structure

The loan guarantee is structured in two tranches, with the first tranche of approximately $782 million released to fund eligible expenses previously incurred by MRL. 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 MRL 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 MRL 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.

Regional Development

An economic impact study 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 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 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 with 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.

SOURCE: Calumet, Inc.