Montana Renewables Secures $1.44 Billion DOE Loan for Renewable Fuels Expansion

Montana Renewables, LLC (MRL), a subsidiary of Calumet, Inc. (NASDAQ: CLMT), has announced the closing of a $1.44 billion loan facility with the U.S. Department of Energy (DOE) Loan Programs Office (LPO). This significant funding will support the expansion of MRL's renewable fuels facility in Great Falls, Montana, positioning the company as one of the largest global producers of Sustainable Aviation Fuel (SAF).

The loan guarantee, structured in two tranches, will enable MRL to increase its annual production capacity to approximately 300 million gallons of SAF and 330 million gallons of combined SAF and renewable diesel (RD). The expansion includes several key components, such as a second renewable fuels reactor, debottlenecking of existing units, installation of SAF blending and logistics assets, increased renewable hydrogen production, cogeneration for renewable electricity and steam, and on-site water treatment and recycling capabilities.

Bruce Fleming, CEO of Montana Renewables, expressed gratitude for the DOE LPO team's dedication and partnership throughout the process. He also highlighted the project's benefits for the local community, the State of Montana, and the Pacific Northwest economic region. The expansion is expected to create 450 construction jobs and up to 40 operations jobs, driving regional economic development and supporting the broader agricultural industry.

The loan facility's structure aligns with Montana Renewables' construction timeline, with the first tranche of approximately $782 million expected to be funded in January 2025. The balance of the loan guarantee will be disbursed through a delayed draw construction facility from the beginning of construction in 2025 through the anticipated completion of the MaxSAF™ project in 2028. This structure allows MRL to fund eligible expenses previously incurred and make an additional $150 million equity investment simultaneously with the first tranche funding. The delayed draw construction facility ensures that funds are available as needed during the construction period, aligning with the project's timeline and cash flow requirements.



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. 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.

Montana Renewables' expansion aligns with the Biden-Harris administration's Investing in America agenda, which aims to build a thriving bioeconomy and advance sustainable fuels to cut harmful emissions and deliver healthier communities across the nation. The project also supports the administration's SAF Grand Challenge goal of increasing U.S. production of SAF to 3 billion gallons per year by 2030 and 35 billion gallons per year by 2050.

In conclusion, Montana Renewables' securing of a $1.44 billion DOE loan facility for its renewable fuels expansion demonstrates the company's commitment to growing its SAF production capacity and contributing to regional economic development. The loan's structure aligns with the company's construction timeline, ensuring a steady and methodical pace for the project's completion. As a leading global SAF producer, Montana Renewables is well-positioned to benefit from the growing demand for sustainable aviation fuel and support the broader renewable energy industry.