Calumet, Inc. (NASDAQ: CLMT) stock is showing significant gains this morning session, increasing 14.50% to $25.11 as of the most recent check. This spike comes after a big fundraising announcement that attracted investors’ attention.
Calumet Secured DOE’s Commitment to Conditional Loans
Montana Renewables, LLC (MRL), a subsidiary of Calumet, has received a conditional commitment for a loan guarantee of up to $1.44 billion from the Loan Programs Office (LPO) of the U.S. Department of Energy (DOE). This loan will fund the expansion of MRL’s renewable fuels facility.
With the potential to generate over 300 million gallons of Sustainable Aviation Fuel (SAF) a year, Montana Renewables, an unconstrained Calumet subsidiary, is poised to rank among the world’s top producers of SAF. It is anticipated that 330 million gallons of SAF and renewable diesel would be produced overall.
MaxSAF Expansion Projects
Montana Renewables plans a series of projects under its MaxSAF expansion, which includes installing a second renewable fuels reactor that will bring nearly half of the 300 million gallon SAF capacity online by 2026.
Other improvements will focus on debottlenecking existing units, enhancing feedstock pretreatment, increasing renewable hydrogen and electricity production, and upgrading on-site water treatment and recycling facilities. This expansion is in line with national goals to promote low-emission sustainable energy alternatives.
Strategic Benefits and National Interest
The planned expansion will help Montana Renewables reduce its carbon footprint by replacing fossil-based jet fuel and diesel with renewable alternatives. Additionally, the project will contribute to regional economic growth and support the U.S.’s transition to sustainable aviation fuels.
The first tranche of the loan, approximately $778 million, is expected to close in the fourth quarter of 2024, with the remainder disbursed through a delayed draw facility until the project is completed in 2028.
Positioning Calumet as a SAF Leader
This strategic partnership with the DOE positions Calumet to lead the U.S.’s SAF transition. By leveraging innovative technologies, Calumet (CLMT) and Montana Renewables aim to become global frontrunners in the rapidly growing renewable aviation fuel sector.
