Calumet’s unrestricted subsidiary Montana Renewables (MRL) has received its initial drawdown of $782m from its $1.44bn guaranteed loan facility with the US Department of Energy (DOE) Loan Programs Office (LPO).
The $1.44bn loan facility, which was closed in January 2025, will fund the construction and expansion of the renewable fuels facility owned by Calumet’s subsidiary, Montana Renewables, positioning it as one of the largest sustainable aviation fuel (SAF) producers globally.
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The expansion will increase Montana Renewables’ annual production capacity to 300 million gallons of SAF and 330 million gallons of combined SAF and renewable diesel.
Key components of the expansion include a second renewable fuels reactor which will facilitate the production of half the 300 million gallons of SAF by 2026.
The expansion also involves debottlenecking of existing units and increased renewable hydrogen production.
Montana Renewables CEO Bruce Fleming stated: “DOE’s mission includes technology and domestic energy security. MRL delivers both. Over the past three years, DOE’s Loan Program Office [has] 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.”
The loan is structured in two tranches, with the first tranche of $782m released to fund eligible expenses previously incurred by Montana Renewables.
Simultaneously, Calumet made an additional $150m equity investment using cash on hand.
The remaining guaranteed loan proceeds, up to $658m, are expected to be disbursed through a delayed draw construction facility.
Montana Renewables anticipates this second tranche will be disbursed during construction, beginning in 2025, with the MaxSAF project due for completion in 2028.
Disbursements under the guaranteed loan facility are contingent upon satisfying specific commercial, technical and legal conditions.
During construction, retained earnings from MRL are expected to supplement DOE funds to maintain debt at 55% of capitalisation during the MaxSAF construction sequence.
The loan has a 15-year tenure and its annual interest rate is set at the US Treasury rate plus 3/8%.
Servicing of principal and interest will be deferred until MaxSAF is commissioned.
Montana Renewables expects the expansion to catalyse regional development, particularly for renewable feedstocks from farms and ranches.
By driving infrastructure development in transportation, agriculture and energy, Montana Renewables aims to create a large-scale, end-to-end SAF industry in Montana and the Pacific Northwest.
The expansion is expected to create 450 construction jobs and up to 40 operations jobs.
