July profitability verifies top tier financial position in renewable fuels.
Steam system maintenance currently limits MRL processing rate until late September.
Pretreater debottlenecking continues with above nameplate rates delivered.
INDIANAPOLIS, Aug. 31, 2023 /PRNewswire/ -- Calumet Specialty Products Partners, L.P. (NASDAQ: CLMT) ("Calumet," "we," "our" or "us") today provided an operational update on its Montana Renewables LLC business.
Montana Renewables, LLC
Montana Renewables LLC ("MRL") estimates adjusted EBITDA of $14.2 million in July, excluding contributions from the specialty asphalt refinery. MRL's EBITDA was $1.23 per gallon overall and $1.35 per gallon on untreated feedstock, in line with guidance. Untreated feedstock comprised 70% of the feed mix in July.
A leak in the steam recovery system on the renewable hydrogen plant was identified earlier this month which will limit throughput until repaired. The repair is expected to be completed in late September. Montana Renewables' redundant hydrogen systems allow the plant to continue to run, albeit at reduced rates. MRL presently estimates 8,000 to 8,500 barrels per day of renewable product sales for the third quarter, and the plant is currently processing all untreated feed. Pre-treater debottlenecking continues, and in August the unit demonstrated the ability to process 11,000 barrels per day of untreated feedstock. Throughput rates at the legacy specialty asphalt side of the operation remain at full levels.
"We are pleased with a very competitive July margin performance in line with our guidance of $1.25 to $1.45 per gallon," said Bruce Fleming, CEO Montana Renewables and EVP Corporate Development. "Margin per gallon will continue to increase as the percentage of untreated feed grows and fixed costs spread over a larger throughput volume after the steam system is repaired."
"I'd like to thank our operations team for detecting an issue in the steam system, bringing it down safely, and quickly developing a repair plan that targets resuming full production by the end of this quarter," said Todd Borgmann, CEO Calumet. "July's financial performance is additional confirmation of Montana Renewables' advantaged competitive position, and we remain on track strategically with our MaxSAF engineering, Department of Energy funding process, and ultimate monetization plans all progressing well."
Cautionary Statement Regarding Forward-Looking Statements
Certain statements and information in this press release, may constitute "forward-looking statements." The words "may," "expect," "plan," "intend," "should," "will," "believe" or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. Our forward-looking statements involve significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. In addition, we have based many of these forward-looking statements on assumptions that could cause our actual results to differ materially from our historical experience and our present expectations or projections. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except to the extent required by applicable law. For information regarding factors that could cause our actual results to differ from our forward-looking statements, please see our filings with the Securities and Exchange Commission ("SEC"), including the risk factors and other cautionary statements in our latest Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q and other filings with the SEC.
Calumet Specialty Products Partners, L.P. 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.
About Montana Renewables, LLC
Montana Renewables, LLC is an unrestricted subsidiary of Calumet located in Great Falls, MT. Montana Renewables converts 15,000 barrels per stream day ("bpsd"; permit capacity) renewable feedstock into low-emission sustainable alternatives that directly replace fossil fuel products. The renewable fuels plant began operations in late 2022. MRL is a leader in North America's energy transition and the largest Sustainable Aviation Fuel producer in the western hemisphere. Renewable products are being delivered to Canada and the United States West Coast.
SOURCE Calumet Specialty Products Partners, L.P.