County commissioners approve up to $275 million in revenue bonds for Montana Renewables

The board of commissioners for Cascade County, Montana, where Great Falls is the county seat, approved a proposal Nov. 30 to issue its solid waste disposal and sewage facility revenue bonds up to $275 million to Montana Renewables LLC, an unrestricted subsidiary of Calumet Specialty Products Partners LP, according to official county documents obtained by Biobased Diesel Daily and confirmation from Bruce Fleming, executive vice president of Montana Renewables.

Montana Renewables recently began production of renewable diesel and sustainable aviation fuel (SAF) at its partially converted petroleum refinery in Great Falls, where the company now makes petroleum products as well as renewables in separate operations on site.

According to the county documents, the bonds can be used for “financing, refinancing or reimbursing all or a portion of the costs of solid-waste disposal and sewage facilities … including design, construction, acquisition and installation of improvements capable of producing renewable fuels from feedstock, including tallow; related industrial sewage facilities; and related improvements; funding any necessary reserves; funding interest on the bonds during construction of the project … and paying costs associated with the issuance of the bonds.”

On Nov. 30, before the commissioners’ approval, Montana Renewables and Calumet presented to the board on the economic benefit of the facility as determined by a recent University of Montana study.

“Calumet and Montana Renewables support over 4,000 people living in the state of Montana through our economic investment, wages, taxes and employment,” said Ron Colwell, the general manager of Montana Renewables. “We have been here, supporting Montanans, for 100 years, and we are committed to being here for another 100 and beyond.”

Renewable diesel and SAF production is expected to grow Calumet’s economic contribution to Montana by 20 percent or more in the coming years, according to the company.

“After a year of investing in the conversion of our facility, today we are sending out our first rail cars of renewable diesel fuel,” Colwell said Nov. 30. “Today is the beginning. By early 2023, we’ll be producing not just renewable diesel and renewable naphtha, we’ll be the largest SAF production facility in the country.”

Montana Renewables has been successful in raising equity but raising debt has been more challenging. According to Fleming, the company had been running a conventional debt process earlier this year, but once Russia invaded Ukraine, the markets became uneasy. “So that didn’t get done,” he said.

The municipal bonds approved for issuance by Cascade County are essentially a loan—the debt financing Montana Renewables had been seeking.

While the approval by the county board of commissioners is a positive development for the biobased diesel producer, it isn’t the actual issuing of the bonds, but rather a step toward their issuance. Montana Renewables anticipates the bonds to be issued in the spring.