Q4 2022 OPAL Fuels Inc Earnings Call

opal fuels will see strong benefits from this E-RIN pathway as our existing renewable power segment will be able to participate and generate significant incremental RINs without investing new capital. We will be providing more clarity around this potential as the rules get finalized.

Profits from this <unk> pathway as our existing renewable power segment will be able to participate and generate significant incremental returns without investing new capital, we will be providing more clarity around this potential as the rules get finalized.

On the demand side of D3 RINs, we remain optimistic that EPA RVO targets could be adjusted higher to account for both cellulosic supply additions as well as the anticipated E RIN volumes as those rules become finalized.

On the demand side of <unk>, we remain optimistic that EPA RVO targets could be adjusted higher to account for both sale off of supply additions as well as anticipated <unk> volumes as those rules become finalized.

It is the clear intent of both the original RFF and proposed rule commentary to support and grow the cellulophic category.

It is the clear intent of both the original RFS and proposed rule commentary to support and grow the Cellulosic category the.

The original loss stated the Cellulosic D. Three category was targeted to be 16 billion D. Three wins in the EP and the EPA administration is meant to support growth up to that figure.

The original law stated the cellulosic D3 category was targeted to be 16 billion D3 RINs. And the EPA administration is meant to support growth up to that figure.

With updated industry production actuals over the past 6 months and demonstrated new supply growth coming online. The EPA has the support to raise volumes and has opened the door for future reenactment of the waiver credit over the multi-year set.

With updated industry production actuals over the past six months and demonstrated new supply growth coming online. The EPA has the support to raise volumes and has opened the door for future re enactment of the waiver credit over the multiyear set period.

It is important to remember why the law and EPA are so supportive of the cellulosic category. The source of this category of biofuels is capturing harmful methane emissions. The single most important thing we can do to combat climate change.

It is important to remember why the law and EPA are so supportive of the Cellulosic category. The source of this category of Biofuels is capturing harmful methane emissions. The single most important thing we can do to combat climate change.

Another interesting feature of the proposed set rule is the multiyear rvo's. We believe that feature may dampen volatility in the future and perhaps open up two to four year contracts for Rins now that obligated parties will have visibility into their volume obligations for a multiyear period.

Another interesting feature of the proposed set rule is the multi-year RVO.

We believe that feature may dampen volatility in the future and perhaps open up two to four year contracts for RIMS. Now that obligated parties will have visibility into their volume obligations for a multi-year period.

So, from our perspective, we believe Opal will ultimately create more value from existing and future projects from the E-RIN pathway. And structurally, we may see new contracting opportunities from the multi-year RBA.

So from our perspective, we believe Opel will ultimately create more value from existing and future projects from the <unk> pathway and structurally we may see new contracting opportunities from the multi year RVO.

Given this outlook, we are currently limiting our 2023 RIN sales in the first half of the year as rules are finalized. And Ann will touch on later how that will roll through our financials and reporting.

Given this outlook. We are currently limiting our 2023 <unk> sales in the first half of the year as the rules are finalized and and we'll touch on later, how that will roll through our financials and reporting.

As you see in our guidance sensitivities, we have much less exposure to <unk> pricing. Our Sonoma project has an offtake contract with a floor of $100 per credit and we have much less dairy production currently online versus landfill enel.

As you see in our guidance sensitivities, we have much less exposure to LCFS pricing. Our Sonoma project has an off-take contract with a floor of $100 per credit, and we have much less dairy production currently online versus land.

On LCFS, though, we remain very optimistic on credit pricing, and the direction that CARB has intimated it is heading to proposed program changes to be finalized over the balance of 2023 for 2024.

Enel CFS, though we remain very optimistic on credit pricing and the direction that carb has intimated. It is heading to on proposed program changes to be finalized.

Over the balance of 2023 for 2024.

CARB is giving clear signals to the market they would like to encourage more investment by supporting pricing, which will likely include stronger compliance targets, creating incremental demand for LCFS credits starting next year.

Carbos, giving clear signals to the market they would like to encourage more investment by supporting pricing, which will likely include stronger compliance targets, creating incremental demand for <unk> credits starting next year.

As we look to this year, we are introducing our 2023 adjusted EBITDA guidance, which we expect to range from 85 to 95 million. Our RNG production range from 3.2 to 3.6 million MMBTUs and capital expenditures to range from 220 to 240 million.

As we look to this year, we are introducing our 2023 adjusted EBITDA guidance, which we expect to range from $85 million to $95 million.

Our RMG production range from three two to $3 6 million <unk> and capital expenditures to range from $220 million to $240 million.

And we'll provide more detail, but we expect an 8M dollar change to 2023 adjusted EBITDA for every 25 cent gallon change in D3 RIN price.

And we will provide more detail, but we expect an $8 million change to 2023 adjusted EBITDA for every 25 gallon change in D. Three RIN prices.

We continue to benefit from substantial and broad based developments in our industry. 1st, I'd like to provide some insight into how our thinking on the IRA has evolved over the last several months.

We continue to benefit from substantial and broad based developments in our industry first I'd like to provide some insight into how our thinking on the IRA has evolved over the last several months.

While we still await the final guidance from Treasury, we are confident that the ITC provisions will apply to Lantill R&G projects, thus encompassing nearly all of our in construction and advanced development pipeline projects.

While we still await the final guidance from Treasury, we are confident that the ITC provisions will apply to landfill R&D projects, thus encompassing nearly all of our in construction and advanced development pipeline projects.

While we are still determining the exact level of benefit, we have been in advanced discussions with the appropriate advisors and counterparties to believe we will benefit significant.

While we are still determining the exact level of ITC benefit we have been in advanced discussions with the appropriate advisors and Counterparties to believe we will benefit significantly.

Second, the 45 Z credits are set to be in Pactyl as well, and we expect clarity from Treasury in the coming months on that front.

Second the 45 Z credits are set to be impactful as well and we expect clarity from treasury in the coming months on that front.

We expect to begin realizing these benefits in 2023 and see them growing in 2024 and throughout the next five years.

We expect to begin realizing these benefits in 2023 and see them growing in 2024 and throughout the next five years.

2023 is set to be a very good year for opal fuels. To some degree, a bit of a contrast from 2022. In 2022, we saw very good commodity, environmental credit pricing, but saw some near term headwinds in the development of our new project.

2023 is set to be a very good year for Opel fuels to some degree a bit of a contrast from 2022 and.

In 2022, we saw very good commodity environmental credit pricing, but saw some near term headwinds in the development of our new project pipeline.

In 2023, we have begun the year with lower near term commodity and environmental credit pricing, but see the positive momentum beginning with our new project development, which is ultimately the long term value driver of our business. With that I'll turn it over to John . Thank you.

In 2023, we have begun the year with lower near term commodity and environmental credit pricing, but see the positive momentum beginning with our new project development, which is ultimately the long term value driver of our business with that I'll turn it over.

John .

Thank you Adam and good morning, everyone.

I want to start out by saying that we are very focused on executing on our growth.

I wanted to start out by saying that we are very focused on executing on our growth plans.

grew RNG production nearly 40% in 2022. We expect to grow by more than 50%.

We grew our LNG production nearly 40% in 2022, and we expect to grow by more than 50% this year.

Our reconstruction portfolio's timing is progressing with a cadence that is in line with our expectations.

Our construction portfolio is timing is progressing with a cadence that is in line with our expectations.

Think sets us up for accelerated growth into 20.

<unk> sets us up for accelerated growth into 2024.

During 2022 are operating project portfolio increased from three to six projects.

During 2022, our operating project portfolio increased.

three to six projects and now seven with the just completed Biotown Dairy Project.

Seven if it just completed biotech dairy project in Indiana.

In 2022, we commissioned 3 landfill R and G project.

In 2022, we commissioned three landfill RMG projects enable road project in Ohio.

The noble road project in Ohio, our new river project in Florida. And the pine band project in Minnesota, these are in G projects represent 1.6Million of name plate. RNG capacity.

Our New River project in Florida, and the <unk> project in Minnesota.

Our LNG projects, representing one 6 million Btu of nameplate RMG capacity.

At all three of these landfill projects gas production continues to increase as the trash volumes there increase.

At all 3 of these landfill projects, gas production continues to increase. At the trash volumes there.

In addition to our operating projects. We currently have six R&D projects in construction with the biotech Gary RMG project of Asia centered operations as we said.

In addition to our operating projects, we currently have 6 RNG projects in construction. With the BioTown Dairy RNG project having just entered operation.

Of these steps, we expect to Emerald to go online in the next several months.

Of these texts, we expect Emerald to go online in the next several months. Prince William in the fall.

William in the fall.

And Sapphire late in the year.

Our 2 dairy projects we expect to be commissioned in early 2024. In the northeast.

Our two dairy projects, we expect to be commissioned in early 2024 and.

In the northeast landfill later in 2024.

As Adam mentioned, we expect production increases this year from our operating and in construction portfolio that are in line with our prior expectations.

As Adam mentioned, we expect production increases this year from our operating and construction portfolio.

That are in line with our prior expectations with a $3 $4 million <unk> midpoint of production guidance.

the 3.4 million MMBT midpoint of production guidance, being a 57% increase compared to RNG production in 2012.

A 57% increase compared to <unk> production in 2022.

I want to pick up on what Adam mentioned earlier about development conditions easing. The good news is that the project...

I wanted to pick up on what Adam mentioned earlier about development conditions to using.

It did news is that the project development logjam breaking in.

And conditions are improving in terms of moving projects forward.

and conditions are improving in terms of moving projects forward compared with last year.

As with last year.

Recall that we described last year presented a number of challenges, which tended to delay projects as landfill owners assessed with substantial market dynamics surrounding the value of their R&D resource.

We're called that we described how last year presented a number of challenges which tended to delay projects as landfill owners assessed.

Dantel market dynamics surrounding the value of their orange.

We provided some color on this topic on our third quarter call.

provided some color on this topic on our third quarter call.

Fast forward to today, and we're already seeing improved.

Fast forward to today, and we're already seeing improvements.

We anticipate an acceleration of executed agreements for gas rights and for construction contracts and about this acceleration.

We anticipate an acceleration of executed agreements for gas rights.

construction contracts and that this acceleration should translate into progressing projects through our advanced development pipeline more quickly and placing projects into construction as we progress through the year.

Translate into progressing projects through our advanced development pipeline more quickly.

Placing projects into construction.

We progressed through the year.

Since we last reported, we've added over 0.8 million MMBG of biogas toward Bansville and Pipeline, most of which is landfill, but also contains dairy and food waste projects.

Since we last reported we've added over $8 million <unk> biogas to our advanced development pipeline.

Most of which is landfill, but also contains dairy and food waste projects.

projects are ones that we have qualified and that we reasonably expect can be into construction within the next 12 to 18 months.

These projects are ones that we have qualified and.

And that we reasonably expect can be into construction within the next 12 to 18 months.

I'd also remind listeners that our advanced development pipeline does not include other earlier stage projects, which we continue to evaluate.

I'd also remind listeners that our advanced development pipeline does not include other earlier stage projects, which we continue to evaluate.

As one of the largest R&D players in the sector, we tend to see most of the projects in the marketplace.

I was one of the largest LNG players in the sector.

Tend to see most of the projects in the marketplace.

All of which makes our pipeline dynamic and growing as we screen for the best opportunities.

All of which makes our pipeline dynamic and growing as we screen for the best opportunity.

Our overall development funnel continues to see positive momentum and provides opportunities in excess of what qualifies as our dance development pipe.

Our overall development funnel continues to see positive momentum and provides opportunities in excess of what qualifies as our advanced development pipeline.

Hopeful Fuels is on track to commence construction of 53 fueling stations.

Okay fuels is on track to commence construction of 53 fueling stations this year.

Approximately 24 opal fuels owned stations. And another 26 for third party.

Approximately 24, Opel fuels owned stations and another 26 with third parties.

Our overall RMG fuel dispensing volumes are expected to grow to approximately 55 million gallons. This year.

Our overall RNG tool dispensing volumes are expected to grow to approximately 55 million gallons this year from nearly 30 million

Nearly 30 million gallons in 2022.

Terms of our landfill gas to electric projects, Opal fuels owns and operates 19 landfill gas to electric projects. Representing about 124 megawatts of nameplate capacity.

In terms of our landfill gas to electric projects Opel fuels owns and operates 19 landfill gas to electric projects, representing about 124 megawatts of nameplate capacity.

Recall that we began developing this portfolio of 25 years ago back in 1998.

All that we began developing this portfolio 25 years ago back in 1998.

While 6 of these projects are candidates for conversion to RNG projects, the majority will remain.

Six of these projects are candidates for conversion to RMG projects.

The majority will remain electric projects.

The EPA's recently proposed E-REN pathway stands to substantially increase the value of these projects.

The EPA has recently proposed E train pathway scales to substantially increase the value of these projects.

adding over $300 per megawatt hour gross to the existing values of these projects.

Adding over $300 per megawatt hour growth.

The existing values of these projects, which has the potential to substantially increase the EBITDA from this business segment.

which has the potential to substantially increase the EBITDA from this business segment. Depending on Eran's sharing,

Pentagon hearings Sherry.

Marine products.

We await updated guidance from the EPA on this topic. Which is...

We await updated guidance from the EPA on this topic, which is which is expected in the next few months.

In the meantime, we are positioning ourselves to meet this market opportunity by continuing discussions with auto manufacturers or proposed to create these <unk> through the EV data that they collect.

In the meantime, we are positioning ourselves to meet this market opportunity.

by continuing discussions with auto manufacturers who are proposed to create these E-RINs through the EV data that they collect.

As we highlighted early on, continued industry consolidation remains a significant tailwind for the RNG industry and certainly for Opal fuel.

As we highlighted early on continued industry consolidation remains a significant tailwind for the <unk> industry and certainly for <unk> fuels.

We'd highlight recent upstream and downstream transactions that acted as additions to existing upstream.

We'd highlight recent upstream and downstream transactions that acted as additions to existing upstream infrastructure.

We think those acquisitions tend to support how industry players are thinking about the value of integration.

We think those acquisitions tend to support how industry players are thinking about the value of integration.

Some of them thinking driving this consolidation revolves around how demand expectations for RMG are expected to shift over the next several years.

Some of the thinking driving this consolidation revolves around how demand expectations for RNG are expected to shift over the next several years.

We're already seeing the beginning of this trend with demand growth from utilities in the form of RNG mandates for power generation, as well as increasing demand in European end markets. And many expect increasing demand coming.

We're already seeing the beginning of this trend with demand growth from utilities in the form of RMG mandates for power generation as well as increasing demand in European end markets.

We expect increasing demand coming from Asia too.

separately hydrogen producers are seeking low carbon sources of renewable methane and our portfolio production assets and fueling station

Separately hydrogen producers are seeking low carbon sources of renewable methane and our portfolio of production assets and fueling stations is well positioned.

well positioned to take advantage as that market moves forward.

Take advantage as that market moves forward.

I'll now turn over the call to Ann to discuss our fourth quarter and year-end financial results.

I will now turn over the call to Ann to discuss our fourth quarter and year end financial results.

Thank you, John , and good morning to all the participants on today's call. Last night, we filed our earnings press release, which detailed our quarterly and year-end results for the period ending December 31st, 2022. We anticipate filing our 10K in the next day or so.

Thank you John and good morning to all the participants on today's call.

Last night, we filed our earnings press release, which details our quarterly and year end results for the period ending December 31 2022.

We anticipate filing our 10-K in the next day or so.

We saw strong growth in 2 of our 3 business segments, RNG Fuels and Fuel Station Services. The biggest driver of the quarter and year to date results is RNG Fuels, where we are starting to see the contribution from the RNG projects that have come online in 2022.

We saw strong growth in two of our three business segments, R&D fuels and fuel station services. The biggest driver of the quarter and year to date results is RMG fuels, where we are starting to see the contribution from the RMG projects that have come online in 2022.

We saw strong top line growth for the fourth quarter with revenue up 42% year over year, driven primarily by higher volumes produced and sold in the R&D fuel segment as well as higher prices for brown gas and higher Rins under forward sales contracts, we had entered into earlier in 2022.

We saw strong top line growth for the fourth quarter, with revenue up 42% year-over-year, driven primarily by higher volumes produced and sold in the RNG fuel segment, as well as higher prices for brown gas and higher rents under forward sales contracts, we had entered into earlier in 2022.

These benefits were partially offset by higher cost of sales due to electric utility costs and employee costs to support our growth, as well as higher royalties driven by higher energy revenue.

These benefits were partially offset by higher cost of sales due to electric utility costs and employee costs to support our growth as well as higher royalties driven by higher energy revenues.

G&A costs for the fourth quarter totaled $14 million, reflecting transaction and other costs, of which $10 million is considered one time.

G&A costs for the fourth quarter totaled $14 million.

Reflecting transaction and other costs of which $10 million is considered one time.

As a result, we generated net income in the fourth quarter of $32 million.

As a result, we generated net income in the fourth quarter of 32 million dollars.

For the full year 2022, before considering the impacts of preferred dividends, we achieved net income of $32 6 million.

For the full year 2022, before considering the impacts of preferred dividends, we achieved net income of $32.6 million, reflecting the standalone results for Opal Fools LLC and ArcLake Clean Transition Corp 2 through the closing of our business combination last July 21st, plus the combined operations since...

Collecting the Standalone results for Opel fuels, LLC and are quite clean transition Corp, Q through the closing of our business combination last July 21.

Plus the combined operations and staff.

Consistent with the results we saw in the fourth quarter, we benefited from pricing for environmental attributes that we had locked in via forward sales early in 2022, coupled with higher commodity prices.

Consistent with the results we saw in the fourth quarter, we benefited from pricing for environmental attributes that we had locked in via forward sales early in 2022, coupled with higher commodity prices.

Looking at fourth quarter results compared to the third quarter RMG production remained constant at $6 million <unk>, which represents.

Looking at fourth quarter results compared to the third quarter, RNG production remained constant at 0.6 million MMBtus, which represents volume net to open.

<unk> volumes net to Opel fuels.

adjusted EDDA was 20.1 million in the fourth quarter versus 25.5 million in the third quarter.

Adjusted EBITDA was $21 million in the fourth quarter versus $25 5 million in the third quarter.

The difference was primarily the result of the previously disclosed $3 million gain from the Biotown debt associated with monetizing an in-the-money LCFS off-take contract.

The difference was primarily the result of the previously disclosed $3 million gain from the bio Tam debt associated with monetizing an in the money Lcs often offtake contract. We also do experience some seasonality with some of our downstream fueling customers did see heavier volumes in the summer months.

We also do experience the seasonality with some of our downstream fueling customers that see heavier volumes in the summer months, along with some timing associated with downstream fuel station construction contracts.

Along with some timing associated with downstream fuel station construction contract.

We reported adjusted EBITDA of $22 million for the fourth quarter and $60 7 million for the 12 months ended December 31 2022.

We reported adjusted EBITDA of $20.2 million for the fourth quarter and $60.7 million for the 12 months ended December 31, 2022.

adjusted EVA Dump benefited from the same drivers we discussed above. Higher environmental attribute pricing and commodity pricing offset by higher cost of sales and higher royalty.

Adjusted EBITDA benefited from the same drivers, we discussed above higher environmental attribute pricing and commodity pricing offset by higher cost of sales and higher royalties.

Fourth quarter adjusted EBITDA excludes several one time items, including an unrealized loss related to a warrant exchange we completed in December .

Fourth quarter adjusted EVA excludes several one time items, including an unrealized loss related to our warrant exchange we completed in December .

We also had a number of one-time costs related to going public that occurred during the fourth quarter and throughout 2022, which are excluded from adjusted EBA DAW.

We also had a number of onetime costs related to going public that occurred during the fourth quarter and throughout 2022, which are excluded from adjusted EBITDA.

As of December 31, we had $167 $8 million of outstanding borrowings net of deferred financing costs, including $94 $3 million of outstanding borrowings under term loan a.

As of December 31st, we had 167.8 million dollars of outstanding borrowing. Net of deferred financing costs, including 94.3 million of outstanding borrowings under term loan A. 28.5 million related to the remaining amount of the convertible note we had issued to Aries for the acquisition of the Imperial and Greentree projects in 2021.

$28 $5 million related to the remaining amount of the convertible note issued to Ares for the acquisition of the Imperial and Greentree projects in 2021.

22.1 million under the Sonoma loan, and 22.8 million related to our renewable power project finance.

$22 1 million under the Sonoma alone and $22 $8 million related to our renewable power project financing.

Our second term loan, which we closed in August , and which will finance a portfolio of RNG projects that are, or shortly will be, in construction, remains undrawn.

Our second term loan, which we closed in August and which will finance a portfolio of RMG projects that are we're certainly we'll be in construction remains undrawn.

As of December 31, our liquidity position was $257.2 million.

As of December 31, our liquidity position was $257 $2 million, including $44 million of cash and cash equivalents $36 8 million of restricted cash $65 million of short term investments and $115 million of undrawn capacity under our term loans.

including 40.4 million of cash and cash equivalents, 36.8 million of restricted cash, 65 million of short-term investments, and 115 million of under-on-capacity under our term list.

We did recently drawdown the final $10 million remaining under term loan line.

We did recently draw down the final $10 million remaining under term loan.

I will also note that we did not have any exposure to either Silicon Valley Bank or Signature Bank, so we were spared any of the associated distraction that many other growth companies have been dealing with in the past few weeks.

I will also note that we did not have any exposure to either Silicon Valley bank or signature bank. So we were spared any of the associated distraction that many other growth companies have been dealing with in the past few weeks.

We expect these existing sources of liquidity to be sufficient to fund the companys construction and development capital needs for the next 12 months. We also anticipate that significant capital continues to be available for deployment in the RMG space.

We expect these existing sources of liquidity to be sufficient to fund the company's construction and to develop the capital needs for the next 12 months.

We also anticipate that significant capital continues to be available for deployment in the RNG.

As a newly public company, we are very focused on how best to attract long term investors.

As a newly public company, we are very focused on how best to attract long-term investors.

The Opal team continues to believe that the most powerful way to do this is to deploy capital effectively and demonstrably grow earnings power.

<unk> team continues to believe that the most powerful way to do this is to deploy capital effectively and demonstrably grow earnings power.

Before turning the call over for Q&A.

I'd like to discuss our 2023 guidance. I will note that all guidance is current as of the published date, is subject to change, and we undertake no obligation to update it.

I'd like to discuss our 2023 guidance I will note that all guidance is current as of the published data.

Is subject to change and we undertake no obligation to update it.

As Adam noted earlier, we anticipate our full year 2023 adjusted EBITDA guidance range to be 85 million to 95 million, which is based on our expected range of RNG production in 2023. Of 3.2 million to 3.6 million and then BTU.

As Adam noted earlier, we anticipate our full year 2023, adjusted EBITDA guidance range to be $85 million to $95 million, which is based on our expected range of RMG production in 2023 of $3 2 million to $3 6 million and then Btu.

Our adjusted EBITDA outlook is predicated on several key pricing assumptions, such as $2 25 per gallon for G. III ran $90 per ton Elsea best credit price and $3 for MN Btu Brown gas.

Our adjusted EBITDA outlook is predicated on several key pricing assumptions, such as $225 per gallon for D3 RIN, $90 per ton LCFS credit price, and $3 for MMBT U Brown.

This quarter. We also included detail on the impact of commodity price changes to our full year revenue and adjusted EBITDA outlook, we expect an approximately $8 million change to 2023 adjusted EBITDA for each 25 per gallon teams and deep III RIN price.

This quarter, we also included detail on the impact of commodity price changes to our full year revenue and adjusted EBITDA outlook. We expect an approximately $8 million change to 2023 adjusted EBITDA for each 25 cent per gallon change in D3 Ren price.

A $1 $4 million change for every 50 per <unk> change in natural gas price and a $400000 change for every $10 per metric ton teams and Lcs that's credit priced.

a $1.4 million change for every 50 cent per MMBTU change in natural gas price, and a $400,000 change for every $10 per metric ton change in LCFS credit price.

We are also updating our guidance for our portion of capital expenditures, excluding acquisition costs and net of any partner capital contributions to 220 million to 240 million dollars.

We are also updating our guidance for our portion of capital expenditures, excluding acquisition costs and net of any partner capital contribution to $220 million to $240 million.

Our guidance does include some assumptions about the amount of ITC, we can monetize in 2023 that we await like everyone else who follows the RMG space definitive guidance from Treasury. So our specific disclosure will be limited until we have that clarity all of our <unk> benefits will be recognized as <unk>.

Our guidance does include some assumptions about the amount of ITC we can monetize in 2023, but we await, like everyone else who follows the RNG space, definitive guidance from Treasury, so our specific disclosure will be limited until we have that clarity.

All of our RRA benefits will be recognized as income, likely in other income, but a reminder that these are real cash proceeds, not just cash tax avoidance. Hence, the recognition is income, which is expected to continue for at least five years.

Income likely in other income, but a reminder, that these are real cash proceeds not just cash tax avoidance, hence the recognition as income which is expected to continue for at least five years.

As a reminder, in accordance with GAAP ASC 606, we can only recognize revenue and the related earnings from environmental attributes. Once they are sold to transfer and accepted by the counterparty we present the value of store gas and unsold environmental attributes as part of adjusted EBITDA to allow the REIT.

As a reminder, in accordance with GAP ASC 606, we can only recognize revenue and the related earnings from environmental attributes once they are sold to, transferred, and accepted by the counterparty. We present the value of stored gas and unsold environmental attributes as part of adjusted EDGA to allow the reader to understand the value and timing of production.

To understand the value and timing of production.

We will continue to report our adjusted EVA with visibility as to stored gas and credit, as we anticipate only selling a minority of our production in the first half of 2023, while we await EPA's updated RV.

We will continue to report our adjusted EBITDA with visibility as to stored gas and credits as we anticipate only selling a minority of our production in the first half of 2023, while we await epa's updated rvs.

As a result, revenue and net income will be lower for the first half of the year, with 2023 results being skewed to the latter half of the year.

As a result revenue and net income will be lower for the first half of the year with 2023 results being skewed to the latter half of the year.

Again, the EBITDA adjustment is intended to levelize this reporting and match inventory produced within the period costs a record.

Again, the EBITA EBITDA adjustment is intended to level is this reporting and matched inventory produced within the period costs are recognized.

Finally going forward for 2023, we will be presenting the revenues and expenses associated with our CMG tolling business in fuel station services as noted earlier.

Finally, going forward for 2023, we will be presenting the revenues and expenses associated with our CNG tolling business in fuel station services.

local owns and operates a number of dispensing stations where we dispense the fuel and service the location for a customer. This activity had been reported in the RNG fuel segment in 2022 and prior periods.

<unk> owns and operates a number of dispensing stations, where we defense the fuel and service the location for our customer.

This activity had been recorded in the R&D fuel segment in 2022 and prior periods.

Going forward, we will include this in the fuel station services segment to better differentiate between the business activities and value drivers in the upstream and downstream portions of our business and facilitate easier comparisons to peers in our.

Going forward. We will include this in the fuel station services segment to better differentiate between the business activities and value drivers in the upstream and downstream portions of our business and facility easier comparisons to peers in our space.

Adding to that although we are labeled as a merchant play due to our exposure to the volatility inherent in environmental attributes. There are several earnings streams in this business that dampen volatility.

Adding to that, although we are labeled as a merchant play due to our exposure to the volatility inherent in environmental attributes, there are several earning streams in this business that dampen volatility.

Our renewable power business is predominantly contracted under long-term power purchasing.

Our renewable power business is predominantly contracted under long term power purchase agreements.

The fuel station services business is profitable and growing, supported by 10-year contracts, both service and fuel supply agreements, as well as construction revenue from stations we build, which provides visibility out for roughly 12 months. The net effect of these two key business segments provides recurring stable earnings and cash flow, which dampens our overall corporate volatility from changing environmental credit markets.

The fuel station services business is profitable and growing supported by 10 year contracts, both service and fuel supply agreements as well as construction revenue from stations, we built which provides visibility out for roughly 12 months. The net effect of these two key business segments provides recurring stable.

Earnings and cash flow, which dampened our overall corporate volatility from changing environmental credit market.

With that, I'll turn it back to John and Adam for concluding remarks.

With that I'll turn it back to John and Adam for concluding remarks.

Thank you Ian.

Thank you, Ann. In closing, we believe our future is bright. We continue to add new projects and advanced projects through our development funnel into operations with accelerating growth and...

In closing, we believe our future is bright.

We continue to add new projects and advance projects through our development funnel into operations with accelerating growth in gas production and distribution.

While the world around us continues to lean into this...

While the world around us continues to lean into this sector.

We're continuing to carry forward <unk> vertically integrated mission.

continue to carry forward Opel's vertically integrated mission.

To build and operate best in class R&D facilities.

Build and operate Best in Class RNG Facility.

that deliver industry leading, reliable, and cost effective R&D solutions.

To deliver industry, leading reliable and cost effective R&D solutions to displace fossil fuel and mitigate climate change.

Just place both of you off and mitigate climate change.

And with that, I'll turn the call over to the operator for Q&A. Thank you all for your interest.

And with that I will turn the call over to the operator for Q&A. Thank you all for your interest in Opal fuels.

Thank you. Again, ladies and gentlemen, if you'd like to ask a question, please press star 11 on your telephone. Again, to ask a question, please press star 11. Our first question comes from Derek Woodfield.

Okay.

Thank you.

Ladies and gentlemen, if you'd like to ask a question. Please press star one on your telephone again to ask a question. Please press star one one or.

Our first question comes from Derrick Whitfield with Stifel. Your line is open.

achi

Okay.

Okay.

Okay.

Yes, hello, good morning all and congrats on a successful first year as a public company and certainly in a difficult operating environment. Thanks, David. For my first question, I wanted to lean into your prepared comments on the progression of your backlog, both near term and medium term for 2023. It appears that Emerald Prince William and staff, our projects are all progressing along the schedule you laid out in Q3.

Yes, Hello, good morning, all and congrats on a successful first year as a public company and certainly in a difficult operating environment.

Yes.

Thanks Derek.

For my first question I wanted to lean in and to your prepared comments on the progression of your backlog both near term and medium term for 2023. It appears that Emerald Prince William and Sapphire projects are all progressing along the schedule you laid out in Q3.

Looking beyond 2023 could you place some parameters on the amount of project capacity from your advanced development pipeline that could be placed on production in 2024 based on improving operating conditions you're experiencing.

Place some parameters on the amount of project capacity from your advanced development pipeline that could be placed in production in 2024 based on the...

Good morning, Derek. Sure. Yeah, so we have a

Hey, good morning, Darren sure.

So we have.

Hum.

Advanced development pipeline of a little over 8 million MNB2s of the nameplate capacity of gas available. And as we continue into 2024, we see our dairy projects and the Northeast landfill project that we placed in the construction last year coming online because of the bugs.

Advanced development pipeline of a little over 8 million Btu.

They play capacity.

Gas available.

Yes.

We continue into 2024, we see our dairy products.

The northeast landfill projects that we placed under construction last year coming online.

Because of the lockdown.

projects going into construction, there will be fewer coming online next year beyond that, but the projects that we placed into construction this year will go online in about 18 months or so would be your average construction time frame from commencement of construction until you start seeing the gas production.

Projects going into construction.

There will be fewer coming online next year.

But the projects that we placed into construction. This year will go online in about 18 months or so would be your average construction timeframe from commencement of construction. So you start seeing the gas production.

could be a little faster, could be a little bit slower. So we'll see gaps from the projects that are going online this year continue to increase our output.

Little faster and be a little bit slower. So we'll see gas from projects that are going online. This year continue to increase our output.

During 2023, and 2024 of those projects come online.

During 2023 and 2024, those projects come online.

And then we will see.

And then we'll see the project putting into construction. This year, start to contribute during the late 2024, 2025 time.

<unk>.

Projects, putting into construction this year start to contribute during the.

It really took late 2020 for 2025 timeframe.

Yeah, the only thing I would add there is obviously we'll have a full year production in 24 on the Emerald project that goes in a couple of months and you'll also get a full year output from the two in the in the later half of this year. And that's really divisible growth and accelerates production from 23 into 24.

Yes, the only thing I would add there is.

Obviously, we will have a full year production in 'twenty four.

Emerald projects that goes in.

And a couple of months and you'll also get.

Full year output from.

The two.

In the later half of this year.

Really visible growth accelerates production from 2020.

'twenty three 'twenty four.

Terrific color and then as my follow up I wanted to focus on the implications of the IRA to your business referencing slides 13, and 14, you arguably have more optionality in your portfolio than ever before as a result of the IRA.

and then as my follow up I wanted to focus on the implications of the eye array.

Referencing slides 13 and 14, you arguably have more optionality in your portfolio than ever before is a result of the IRA.

As you assess your R&D he ran in hydrogen opportunities how does the <unk> pathway impact your view on the allocation of capital between R&D and electricity with the understanding that the time is likely your front based on the growth of Evs relative to landfill gas and then more specifically for 2023 guidance could you comment on the degree of ITC embedded.

As you assess your RNG, Iran, and hydrogen operation.

How does the E-RAN pathway impact or reveal the allocation of capital between RNG and the E-RAN pathway?

The understanding that time is likely your friend based on the growth of EVs relative to landfill gas. And then more specifically for 2023 guidance.

Comment on the degree of ITC embedded in your project.

In your projections.

Yeah, I'll let Anne handle the ITC one first, and then I'll talk a little bit about some of the regulatory stuff happening both in terms of IRA and the E-Rinth pathway. Yeah, thanks, Sarah. It's, and so as I had commented, I think given the fact that we're still leading for additional guidance from Treasury, which we expect.

Yes ill, let Dan handle the ITC, one first and then I'll talk a little bit about some of the regulatory stuff happening both in terms of the IRA uneven pathway, yes. Thanks.

And.

So as I had commented.

I think given the fact that we're still waiting for additional guidance from Treasury, which we expect to come most likely in Q2 were being a little circumspect in terms of the specific amounts and details of what we've included in adjusted EBITDA for ITC.

to cobble up likely in Q2. We're being a little circumfect in terms of the specific amounts and details of what we've included in adjusted ebba.4 ITC.

I think we are making some underlying assumptions obviously about the projects that are in construction and that we'll see a V this year. But beyond that, I think at this point, we're not really ready to disclose my-

We are making some underlying assumptions obviously about the projects that are in construction.

We will see this year, but beyond that.

I think at this point, we're not really.

Ready to disclose much more than that.

Yes as far as some of the other this is Adam here as far as some of the other public policy stuff that we see.

Yeah, and as far as some of the other, this is Adam here, as far as some of the other public policy stuff that we see happening, in addition to the IEC, which we'll get some clarity on. We're also expecting in 2023 to get some clarity around 45 decalculations and how carbon intensity scores may be allocated.

Happening.

In addition to the ITC.

Which we'll get some clarity on we're also expecting in 2023 to get some clarity around the 45 day calculations in our carbon intensity score as may be allocated.

We think that's going to be really impactful, specifically for

We think thats going to be really impactful specifically for.

you know, the heavy negative CI kind of gas, but we need to see a little bit more clarity to really get a better understanding on that. The e-rin patch, when we think is really interesting for our business, and opens up all sorts of incremental.

The heavy negative Ci.

Gas, but we need to see a little bit more clarity to really get a better understanding on that.

<unk> pathway, we think is really interesting for our business.

Opens up all sorts of incremental profitability opportunities on our existing landfill gas to electric projects and how we think about some of the new project development and what kind of opportunities that may open up.

Opportunities on our existing landfill gas to electric projects and how we think about some of the new project development and what kind of opportunities that may open up.

And, you know, it is it is a little uncertain in the timing of when they may finalize that rule. The EPA has received a number of comments back in February , so we'll see whether or not they're going to give that clarity in June . When we do expect, you know, perhaps a re-look at the RVO volume,

<unk>.

It is a little uncertain in the timing of when they may finalize that rule.

The EPA has.

<unk> received a number of comments back in February So we will see.

Whether or not they're going to give that clarity in June when we do expect.

Perhaps when you look at the RVO volumes, whether or not that's going to include finalized rules on the year and so that may slip it into later in 2023.

whether or not that's going to include finalized rules on the E-RINs or that may slip into later in 2023.

You know, as we think about it from a capital perspective on what makes an R&G project purses.

We think about it from a capital perspective on what makes an LNG project versus a landfill gas electricity project.

a landfill gas electricity project. We like having the optionality for all who's doing market set of opening up that you mentioned, whether it not be hydrogen or quite frankly a lot of export markets that are opening up.

We like having the Optionality for all these new end markets that are opening up that you mentioned, whether or not be hydrogen or quite frankly, a lot of export markets that are opening up.

So we like the idea if we can see good risk adjusted returns on a capital for an RNG project to continue to deploy capital and have that flexibility of offtake whether it be you know, you fix voluntary markets or strengthen involuntary markets. So...

So we like the idea if we can see good risk adjusted returns on capital for an R&D project to continue to deploy capital and have that flexibility of off take whether it be new fixed voluntary markets are strengthening voluntary market. So.

We see this as a big additive to our to our business overall and on the landfill existing landfill gas to electric projects, obviously that would be incremental profitability without having to invest new capital. So.

We see it as a big additive to our business overall and on the existing landfill gas electric projects, obviously that would be incremental profitability without having to invest new capital. So, we're excited about the prospects for it and we'll see the timing for when they finalize that role. That's great.

We're excited about the prospects for it and we'll see.

The timing for when they finalize that rule.

Okay. That's great. Thanks for your time and comments.

Thank you one moment please.

Our next question comes from the line of Ryan Todd of Piper Family. And line is open. Good thing.

Our next question comes from the line of Ryan Todd of Piper Sandler Your line is open.

Great. Thanks.

Congrats on the result, and let me.

I apologize that a conflict and missed some of your earlier comments, so I hope...

I apologize a conflict and missed some of your earlier comments I hope.

i'm not sure if you address them in a circle but

I'm not sure if you addressed some of this earlier in the call but.

It's been a challenging stretch for many of the LNG industry in terms of project execution getting volumes delivered on time and budget.

It's been a challenging stretch for many in the RNG industry in terms of project execution, getting volumes delivered on time and budget.

You know, what have they've, what have been the biggest challenges for you on the project execution side? You know, I guess both on dairy and landfill.

What are the what are the biggest challenges for you on the project execution side, I guess, both on dairy and landfill.

And are those things improving? Can you talk about how maybe, you know, parts of the supply chain?

Are those things improving can you talk about how maybe parts of the supply chain and your ability to.

and your ability to execute on your significant backlog is improving going forward and what has improved.

Executing on your significant backlog is improving going forward and what what has improved if anything.

Hey, good morning, Ryan. This is John Moore. I'll start at this point. I think we reported a lot.

Hey, Good morning, Brian This is Tony Mauro.

Sorry to disappoint.

I think we reported last quarter.

There was a slowdown in execution of contract, the movement through the pipeline as land sales.

There was a.

A slowdown in execution of contracts the movement through the pipeline.

<unk> landfills realize the value of the RMG inherent in their landfills.

realized the value of the RNG inherent in their landfills. And each of the major landfills and many of the smaller ones took the opportunity to reassess how they wanted to approach that value proposition.

Each of the major landfills and that it was borrowers so the opportunity to reassess.

How they wanted to approach.

<unk> proposition.

So that's resulted in a bit of delay, but I think they're true that process.

So that resulted in a lift in a bit of a delay, but I think they're through that process and we're seeing a lot of movement through our advanced development pipeline and progress there. So.

And we're seeing a lot of movement through our advanced development pipeline and progress there.

So, you know, conservatively, we think that we'll put 2 million MMVTU into construction this year. Our overall pipeline, we reported an 8 million. We think there's great opportunity to accelerate that. But we want to stay conservative on the outset and really update our...

Conservatively.

We will put 2 million btu in the construction this year, our overall pipeline, we reported $8 million, we think there's great opportunity to accelerate.

But we want to stay conservative on the outset and really.

D R.

projections and guidance to you as we execute on those projects in that way.

Projections and guidance to you.

We execute on those projects.

and is there anything on the supply chain side of things that is that's problematic at this point or is has that moderated to a level that it's it's not an issue anymore

And is there anything on the supply chain side of things that is.

<unk> at this point or has that moderated to a level that it's not an issue anymore.

In terms of acquiring equipment.

In terms of acquiring equipment, there's been a little bit of lead time.

There has been a little bit.

Our lead time.

But most of that is dissipated and that there's plenty of opportunity to get the equipment that we need to build out our project. So nothing material there that we're seeing right now.

Most of the anticipated.

There's plenty of opportunity to get the equipment that we need to build out our projects so nothing material there.

We're seeing right.

Great. Thanks, maybe.

You know shifting gears from you know, conversations with investors liquidity.

Shifting gears.

From conversations with investors liquidity.

And your stock remains a challenge, even for those that are positive on the story and the valuation. Can you talk about what options you may have to address currently, including the stock, what sort of timeline might be possible, and how much of a focus is this or is this an issue where we just have to grow the EBITDA and the earnings and move things.

And your stock remains a challenge even for those that are that are positive on the story and the valuation I mean can you talk about what options you may have to address current liquidity in the stock sort of.

Timeline might be a possible in.

How much.

Our focus is this or is this an issue where we just have to grow the EBITDA and the earnings.

Move things along that way, yes. This is Adam here.

Yeah, this is Adam here and I will say we hear similar questions when we have our investor meetings.

I will say, we hear similar questions when we have our investor meetings.

where people are really positively disposed to RNG and really like the Opal story and maybe would like to see more liquidity in our stock. I'll answer it a couple different ways. One is...

People are really positively disposed to RMG and really like the overall story.

And maybe.

We'd like to see more liquidity in our stock.

I'll answer a couple of different ways one is.

You know, we don't need to do any primary sheriff's once we've got enough liquidity in place and capital raising plans in place to continue to execute on our development pipeline. So there's no need to raise.

We don't need to do any primary share issuance, we've got enough liquidity in place.

Capital raising plans in place to continue to execute on our development pipeline. So there is no need to raise.

capital from a primary share issuance. From a secondary share issuance, I'd say, like most management teams, we feel our shares offer a compelling value here, so I don't know if there's a lot of interest.

Capital from our primary share issuance from our secondary share issuance.

I'd say like most management teams, we feel our shares.

Offer a compelling value here. So I don't know if there is a lot of interest are currently on a secondary and we don't have any immediate plans in place.

Currently on a secondary and we don't have any immediate plans in place.

You know, we do think that there could be some opportunities to increase the flow with a smaller talking acquisitions and perhaps.

We do think that there could be some opportunities to increase the float with.

Smaller tuck in acquisitions and perhaps.

Yes.

increase the liquidity in both that way. We are gonna spend, you know, continue to ratchet up time spent with investors and analysts and thinking about, you know, analysts or investor day later in the year. So we will be visible and try and increase the visibility of local fuel, but we don't currently have anything on the table for either a primary or a secondary. Okay, great.

Increased liquidity inflows that way.

We are.

Are going to spend.

To ratchet up time spent with investors and analysts and thinking about.

An analyst or Investor Day later later in the year, So we will be visible and try and increase the visibility of local fuel.

But we don't currently have anything on the table for either a primary or secondary.

Okay, great. Thank you.

Thank you one moment please.

Our next question comes from the line of Matthew Blair of Tudor Pickering and Holt Company, a line of...

Our next question comes from the line of Matthew Blair of Tudor Pickering Holt Company. Your line is open.

Hey, good morning, Adam, John , and Ann. Hope you're doing well. Could you share any thoughts on how Q1 is progressing? Seems like you would have some volume and potentially margin benefit from the startup at the Biotown Dairy. But then headwinds from lower D3-Rin prices, as well as rolling off the locked-in D3-Rin from last year.

Good morning, Adam Jon and I hope Youre doing well.

Could you share any thoughts on how Q1 is progressing.

Like you would have some some volume and potentially margin benefit from the startup of the <unk>, but then headwinds from lower <unk> prices as well as rolling off the locked in <unk> from last year.

Does that sound about right? Is there anything else that we should be thinking about in regards to Q1? And at this stage, can you say if Q1 EBITDA is likely to be higher or lower, quarter to quarter?

Does that sound about right is there anything else that we should be thinking about in regards to Q1 at this stage can you say if Q1 EBITDA.

It is likely to be higher lower quarter over quarter.

Okay.

So I can take that and then others can jump in. So obviously, we're just reporting 2022 here. We've given initial guidance. We'll be reporting Q1 and then call it next, I don't know, six weeks or so.

So I can take that and then others can jump in so obviously, we're just reporting 2022 here given initial guidance, we will be reporting Q1 in that call. It next I don't know.

Six weeks or so.

But I think, you know, everything that you said there, I generally agree with. I think from our perspective, we are seeing gas production going in the right direction. Ray is growing. The caveat, there are two caveat. First of all, by our count, we are minority owner.

But I think.

Everything that you said their gender.

Generally agree with I think from our perspective, we are seeing gas production going in the right direction right. It's growing.

A caveat.

First of all <unk>.

We are a minority owner.

So, you know, we will see an equity pickup in our results for that, but it's not under our direct control. The second piece is, if I highlighted in my comment, you know, from a rented LKF perspective, we anticipate in the first half of the year that will be called minimal sellers, right? You know, just enough to manage the business, but clearly we see value. So our results will be skewed to the latter half of 23.

No.

We will see an equity pickup.

Thanks for that.

It's not under our direct control the second piece is as I highlighted in my comments.

Brandon I'll give that perspective, we anticipate in the first half of the year and it will be I'll call it minimal sellers Bryan.

Just enough to manage the business, but clearly we see value. So our results will be skewed to the latter half of 'twenty three.

So I think it's important to keep those two things in mind.

So.

It's important to keep those two things in mind.

And we will continue as I commented to show the value of both towards gas and unsold environmental attributes.

And we will continue, you know, as I commented, to show the value of both storage gas and unfold environmental attributes as a justlet to adjusted eva-daw against the people can see kind of what's pending.

Adjusted debt to adjusted EBITDA against the people can see kind of what's pending right to be monetized again, hopefully in the latter half of the year, Yes, I just wanted to follow up with Adam again.

right to be monetized again, hopefully in the latter half of the year. Yeah, I just want to follow up with that. Again, it's really key for us to do that to be able to match current period expenses versus what the value of the gap that we're producing, holding an inventory and credit that we're minting and holding an inventory. We do report current period expenses for all of that gap that is producing credits that are in inventory.

Really key for us to do that to be able to match current period expenses versus what the value of the of the gap that we're producing holding inventory in credits that were missing and holding inventory. We do report current period expenses for all of that gas that is producing credits that are that are in inventory.

Okay.

So just to follow up on that.

So just to follow up on that, and when you said that results will be skewed to the back half of the year.

And when you said the results will be skewed to the back half of the year.

When you said that initially, I took it to mean that your cash flows.

When you said that initially took it to mean that your cash flows.

would be skewed to the back half of the year, but it sounds like you're saying that that actually ebba da

Would be skewed to the back half of the year, but it sounds like youre, saying that that actual EBITDA.

would be skewed. Is that the right interpretation? So, now again, we will be adding back the value in adjusted either dot, so we'll be reporting it in each quarter. So, to your point though, cash will be skewed towards the latter half of the year. Yeah, and it will show up in lower revenues and lower net income. Right, exactly. So, when you report your gap in operating income, it will be lower in the first half, the second half. And once we plan on monetizing the balance of rent and RNG, that's an inventory. But from an adjusted even though it gets smoothed out. Correct.

Would be skewed.

That interpretation.

So again, we will be adding back the value in adjusted EBITDA and we'll be reporting it in each quarter.

So to your point, though cash will be skewed towards the latter half of the year and it will show up in lower revenues and lower net income right.

Exactly so when you when you report your GAAP and operating income it will be lower in the first half in the second half once we plan.

On monetizing the balance of <unk> and R&D.

Inventory, but prudent from an adjusted EBITDA basis, it gets smoothed out correct.

And Matthew Paul just adds, as well, good morning Mike, to hear you on the call here, that with the Emerald Project coming online been here, you'll see a substantial pickup in gas in revenues income and even on, it's like a half a year as well, from now.

Matthew.

To add as well good morning, nice to hear you all of Europe .

It would be MRO project coming online mid year, Youll see a substantial pickup in.

Gas.

Revenues income and EBITDA in the second half of the year as well from that.

Okay. That's helpful and then.

Okay, that's helpful. And then follow up is just on the renewable power portfolio. It looks like there was an asset where you're, I guess your contract wasn't renewed. Could you talk a little bit about that? And do you view that as a risk going forward? Thank you.

And follow up is just on the renewable power portfolio. It looks like there was an asset where your I guess your contract wasn't renewed could you talk a little bit about that and do you view that as.

At the risk going forward. Thank you.

Yes.

So Matthew John again, I'll take that. I'll start this one off. Yeah, that was a project that we had long term gas rights on it was with immunospegality and the municipality of the gas rights ended pursuant to its term. And the municipality decided that they wanted to.

So Matthew John again.

I'll take I'll start this one off.

Yes.

<unk> that we have long term gas price on it was with a municipality and then.

<unk> the gas price ended pursuant to its term.

<unk> decided that they wanted to.

Take those accounts growing stock remove the power project.

remove the power project and look at the future later in life. It didn't involve anything to do with our project other than the fact that they are, I guess, keeping their options open in terms of what their future might look. And I'd say when you look across the portfolio, I'm just looking at John here and we can follow up. I don't think we'd have any gas rays.

Look at the future later.

In life.

Student enrolled.

Anything to do with our project other than.

Sure.

Or I guess, keeping their options open in terms of what their future.

I'd say when you look across the portfolio I'm just looking at John here and we can follow up.

Don't think we have.

Any gas rates.

Expiring.

No nothing in the near future.

No, nothing in the near future.

Very helpful. Thank you.

And I'll add to that, that when we do a renewable network gas project and we build these...

And I'll add to that.

When we do our renewable natural gas projects and we build these we.

We get gas prices that are generally 20 years or longer with regard to those projects. So, you know, that's kind of a legacy, renewable power feature, but we don't see it affecting other projects going forward in the near future. Yeah, I would really consider that one off.

Gas prices are generally 20 years or longer with regard to those projects. So.

Sure.

Carnival.

On a legacy <unk>.

<unk>.

Our feature.

We don't see it affecting other projects going forward in the near future I would really consider that one off.

Thank you.

One moment please.

Our next question comes from a lot of Martin Maloe of Johnson Rice, your line of bill.

Our next question comes from the line of Martin Malloy of Johnson Rice. Your line is open.

Good morning. I had a question on the cost side and relic into slide seven with the revenue for landfill gas, dollar per MNBQ. Could you maybe, and I realized with projects coming online, there's a lot of movement around the cost side, but you maybe talk about. I am sorry.

Good morning.

A question on the cost side relative to slide seven.

With the revenue for landfill gas dollar per <unk> could you, maybe and I realize with projects coming online. There is a lot of movement around the cost side, but can you maybe talk about.

Where you expect to get to on the cost sign in terms of dollar premium BTU and the past towards getting there.

We expect to get to on the cost side in terms of dollars per <unk> and the path towards getting there.

Yeah, this is the atom here. I'd say in general, although there were some escalated utility costs in 2022 and some other general inflationary pressures, our cost for MNB2 has not changed materially.

Yes. This is Adam <unk>.

I would say in general although there were some escalated Utah.

Utility costs in 2022, and some other general inflationary pressures or cost per MD to you has not changed materially.

from what we've talked about previously. We're still in the high single digits for our cost of production on landfill and call it somewhere in the low 20s on dairy. And we are always trying to drive efficiencies in our business and trying to maximize output and productivity of our plants.

From what we've talked about previously.

We're still in the high single digits for our cost of production on landfill and call it somewhere in the low twenties on dairy.

We are always trying to drive efficiencies in our business and.

Try to maximize output and productivity of our plants.

So I'm not going to give you a specific target on where we think we can get costs down to. But we don't see a lot of material changes from where we've been and what we've discussed to start with. Thank you.

I am not going to give you a specific target.

On where we think we can get cost down too.

But we don't we don't see a lot of material changes from where we've been and what we've discussed historically.

Thank you I'll turn it back.

Thank you one moment please.

Our next question comes from the line of William Gripping of UBS, you know.

Our next question comes from the line of William Gripping of UBS. Your line is open.

Yes.

Great. Thanks.

Great, thanks. Good to speak with you all and thanks for taking the questions. I appreciate all the color that you've already provided. It just have a couple of maybe more modeling questions here. But first, could you provide any color on the SGNA that you have embedded in the Adjusted Ebutter Guide for 2023?

Good to speak with you all and thanks for taking the questions.

I appreciate all the color that you've already provided I just have a couple of maybe more modeling questions here, but first could you provide any color on the SG&A that you have embedded in your adjusted EBITDA Guide for 2023.

This is Ian, so I don't think that we want to get to the level of detail and actually guiding there. As you can imagine, first year public company, I think we've tried to model out something that is appropriate and reasonable, but I don't think we want to get to that level of detail in our guidance.

This is Ann so I don't think that we want to get to the level of detail and actually signing.

There as you can imagine.

First year public company.

Can model out something Thats down.

Appropriate and reasonable, but I don't think we want to get to that level of detail in our guidance.

Fair enough alright, so just pivoting to.

Fair enough. All right, so pivoting to the E-Rin pathway, just what are the key developments that you need there to or expect to come there to gain clarity on how impactful that could be for Opal?

The <unk> pathway, just what are the key developments that you need there to or expect.

To come there to gain clarity on how impactful that could be for Opel.

Yeah, so this is Adam here. I say from a super high level, we have to see whether or not it's included in the final rule as a pathway. You know, right now they've proposed that you could use renewable power to be used at the electricity as a transportation fuel. So first order of business, are they gonna include that as a pathway here in June ?

Yes. So this is this is Adam here I'd say from a super high level, we have to see whether or not it's included in the final rule as a pathway.

Right now they propose that you could use renewable power to be used as electricity transportation fuel. So first order of business are they going to include that as a pathway here in June .

Second order is they may delight it quite frankly. I think there's a lot of push and a lot of momentum behind including it, but the industry have a lot of questions around some of the mechanics that we need some clarity around, which is what is the equivalent of value? How many rims are they going to assign per megawatt that you produce? There's a little bit of mechanics around.

Second order of business.

May delay it quite frankly, I think there's a lot of push in a lot of momentum behind including it but industry have a lot of questions around some of the mechanics that we need some clarity around which is what is the equivalency value. How many brands are they going aside assigned per megawatt that you.

That you produce there's a little bit of mechanics around.

Who the regenerate or will be I don't think that necessarily impacts the economics, so much but people have a lot of questions over whether or not the auto OEM will be the the generator of that RIN credits, and then who needs to be assigned on the pathway, which is that entire value chain and he ran for how the economics are going to get.

necessarily impacts the economics so much, but people have a lot of questions over whether or not the auto OEM will be the degenerator of that rent credit. And then who needs to be assigned on the pathway, which is that entire value chain of the E-Rin for how the economics are going to get split up. So we think it's all potentially really positive, and there's also the potential to take your RNG from a pipeline and potentially create some of the events. So there's a lot of real nuances in it, but those are just a few of the flavors on the high level of what we've been some prism clarity on.

Split up so.

It's all a potentially really positive and there is also the potential to take your R&D from our pipeline and potentially create some EBIT. So there's a lot of little nuances in it.

But those are just to give you a flavor some of the high level of what we presume.

For some clarity on.

All right, appreciate it. That's all for me. Thank you. Thank you, one moment, please. Our next question comes from a lot of.

Alright I appreciate it that's all for me.

Yes.

Thank you one moment please.

Our next question comes from the line of Ryan Zink.

B Riley your line is open.

Hey, good morning, guys.

Maybe I'll just sneak one in here, going back to your comments around.

Maybe I'll just sneak one in here just going back to your comments around the multi year RVO, allowing for the potential of longer term contracts or are those discussions happening today.

The multi-year RVO, allowing for the potential of longer-term contractor, are those discussions happening today? And...

What would be your expected timeframe for entering into contracts like that? Yeah, they're happening internally. They're happening with other market participants. I wouldn't say they've begun in real earnest yet with obligated parties. You know, we would anticipate those kinds of things to potentially start happening once the volumes are set. So that's something that we can report back on in the back app in here. Gotcha.

What would be your expected time frame for entering into contracts like that yes, they're happening internally. They are happening with other market participants I wouldn't say they've begun in real earnest yet with the obligated parties.

We would anticipate those kinds of things to potentially start happening once the volumes are set.

So that's something that we can report back on in the back half of the year.

Got it thanks, I'll turn it back.

Okay.

Thank you one moment please.

Our next question comes from the line of Craigsree of Toe, of Brothers, your line of open.

Our next question comes from the line of <unk> of Tuohy Brothers. Your line is open.

Hi, Thanks for taking the questions.

Hi, thanks for taking the questions. So first, maybe you can help me understand, if there's a biogasca power project that has a long-term PPA offtake.

So first maybe you can help me understand if theres a biogas powered project that has a long term PPA off take.

How does the ERINs work in that case? What's it is two to five years left on the PPA? Does the off-take around that or how's all that work?

How does that <unk> work in that case, let's say, there's three to five years left on that PPA.

The off taker on that or how does all that work.

Thank you for your question. This is John . So it varies. Some project.

Thanks for your question this is John so.

It varies.

Some projects.

Find the carbon value, either through reps or otherwise to the power purchaser and some do not. And you know, Haydenbiz where it has been assigned and the project is potentially material participant in this market. We've come in discussions with counter parties to substitute.

The carbon value either through rest or otherwise to the power purchaser.

And.

Boots were.

It has been assigned.

And the project is potentially material participated in this market we have commenced discussions with counterparties to.

Substitute.

So, our inquiry has fired RINs for the renewable attributes from our gaps that will enable up to then sell the E-RIN. So, it's kind of a mixed bag out there, but I would say that we see a pathway to getting some majority of our renewable power into the E-RIN pathway.

Third party acquired brands for the renewable attributes from our jobs that will enable us to them, though so.

So so so there's kind of a mixed bag out there, but I would say.

We see a pathway to getting the majority of our renewable power into the hearings.

Great.

<unk>.

And then you talked a couple times on this call about.

And then you talk a couple of times on this call about, you know, the

Sure.

pick up a reassessment of landfill operators last year that seems to be thawing, allowing projects to move forward or at least counter-contracting.

Pick up a reassessment of landfill.

Operators last year, those things to be thawing, allowing projects to move forward or it was killing contracting.

<unk>.

If they were reassessing the underlying value of RNG in their footprint, does that mean for new contracts and projects that perhaps higher splits have to be afforded to be...

If they were reassessing.

The underlying value of our LNG and their footprint.

Does that mean for new contracts and projects that perhaps higher splits the afforded to be.

Site hosts.

I think all of that took place over the course of the last year or two.

I think all that took place over the course of the last year or two and that people settled out as to what the right splits ought to be. I think that the value has shifted somewhat as some of that has been recognized. But most of that has taken place.

People settled out as to what the right.

The splits of the.

I think thats the value has shifted somewhat as some of that has been recognized but most of that has taken place.

And, you know, we'll still see some dynamics out there. But I think that the pathway is open for getting more contracts.

We will still see some dynamics out there, but I think.

So.

Okay.

Or are getting more contracts.

finalize and sign and putting those projects.

And so by putting those projects into construction.

into construction in the near future. Yeah, and this is that. I'll just a couple of quick follow up there. One is, I don't, you know, we haven't seen any real changes.

In the near future. Yes. This is Andy I'll just.

Just a couple of quick follow ups there one is.

We haven't seen any any real changes in England in royalty rates.

That changed sort of.

How build multiples look for us and that sort of thing so.

That's positive. And just to John's point there, we really do feel like we've gotten some good visibility in traction and getting these things across the finish line. And so it was a little surprising for how long documentation can take. A lot of these things, like we feel really good about where we're at today versus maybe six months ago in terms of moving those things through documentation.

That's positive.

And just to John's point there.

We really do feel like we've gotten some some good visibility and traction and getting these things across the finish line and.

It's always a little surprising for how long documentation can take on a lot of these things.

But.

We feel really good about where we're at today versus maybe six months ago in terms of moving those things through.

Documentations.

Thanks, and really quick modeling question, if your banking rooms to sell potentially higher prices the firm RVO in the second half how.

Thanks, and really quick modeling question. If you're banking rents to sell potentially higher prices after the firm RVO in the second half.

How do you assess the pricing at which you report that in your adjustability to the

How would you assess the pricing at which you report in your adjusted EBITDA.

So I think we shared with you kind of what our assumptions were in terms of guidance. And as we get through each quarter, we come to Q1, we'll probably, we'll make an assumption around kind of what that president looks like for the value at that time and provide an updated sensitivity in terms of, you know, what market prices are.

So I think we shared with you what our assumptions were in terms of the guidance.

And as we get through each quarter.

If we come to Q1, we will probably will make an assumption around kind of what that looks like for the value at that time and provide an updated sensitivity in terms of what market price environment.

Okay. Thank you.

Thank you one moment please.

Our next question comes from the line of Derrick Whitfield of Stifel. Your line is open.

Our next question comes from a lot of Derek Whitfield of people your line is open.

Yes.

Again, wanted to ask a follow up on the last question and ask you really to elaborate on the competitive landscape more broad.

Again I wanted to ask a follow up on the last question and ask you really to elaborate on the competitive landscape more broadly as you are aware and as noted we've observed unprecedented levels of M&A for R&D assets over the last year.

As you're aware and have noted, we've observed unprecedented levels of M&A for R&G assets over the life.

with an increased focus more recently in the downstream side based on the BP travel centers potential act.

With an increased focus more recently in the downstream side.

On the BP travel centers potential acquisition in your view what are these transactions imply about the value of your business and how do they altered the competitive and operating environment for you.

In your view, what are these transactions that imply about the value of your business, and how do they alter the competitive?

seemingly there are less agile guys at the table right now.

Seemingly there are less agile guys at the table right now.

Versus past periods.

Yes. So this is Adam here.

Yeah, so this is that. I'm here. I actually thought that was a pretty interesting acquisition that BP made there. And I think the read through is something that we've talked about in the past about being vertically integrated and where price and power could be for alternative.

Actually got to have some pretty interesting acquisition that.

That <unk> made there and.

Yes.

Thank the read through is something that we've talked about in the past about being vertically integrated in and where pricing power could be for alternative.

fuels into the, you know, sort of, class-based industry. And, you know, from my perspective, and we've seen a couple of these other smaller private downstream players as well get acquired.

Fuels into into the into the.

Sort of class eight industry and.

From my perspective, and we've seen a couple of these other smaller private.

Downstream players as well and get acquired.

By other major E&ps, we feel it's a little bit of a validation of.

by other major EMTs. We give it a little bit of a validation of of sort of what we put together and grow in organically. And

All of us.

What we've put together and grown organically and.

I think I think there's some interesting opportunities as a vertically integrated player and.

You know, I think there's some interesting opportunities as a vertically integrated player. And we'll see how that plays out. Historically, deployment in this industry has really been a sort of a behind-the-scenes kind of model and dedicated tooling. We think that 15-liter engine is gonna open up.

We'll see we'll see how that plays out historically.

Deployment in this industry has really been.

Sort of a behind the fence kind of model and dedicated fueling we think Thats 15 liter engine, it's going to open up.

some new opportunities with some trucking and logistics leads.

Some new opportunities with some trucking and logistics suites.

And maybe there could be ways too.

and maybe there could be ways to look at how future deployments could be. So, you know, and we have seen, you know, obviously a lot of M&A activity on just the upstreet production side as well. So, you know, we feel like it's an interesting read through for what we put together during all the schedules. And if I could just say, Derek, that...

<unk>.

Look at how our future deployments could be so.

And we have seen obviously a lot of M&A activity I'm, just the upstream production side as well.

We feel like it's.

An interesting read through for what we've put together here at <unk>.

And if I can just say it's Eric.

Yes.

In general the <unk>.

In general, the pendulum continues to move towards decarbonization and the value of renewable fuels continues to be central to those strategic planners and now to financial players as well. And so, you know, we continue to see a lot of interest as I was.

<unk> continues to move towards decarbonization.

<unk>.

Renewable fuels continues to be central to those strategic partners.

Now to.

<unk> financial players as well and so we continue to see a lot of interest as I was saying earlier I feel like.

saying earlier, I feel like the country in the world is leaning into this sector. And you continue to see it quarter after quarter as companies are making moves towards that decarbonization, how they're gonna play in that in the future. It's a tough decision for a lot of people to make and then to find the right opportunities.

The country and the world is kind of leading into this sector.

And you continue to see.

Our third quarter.

Companies are making moves towards the.

T carbonization, how theyre going to play in that in the future. It's a tough it's a tough decision for a lot of people and then to find the right opportunities.

of companies that are growing in the vessels of the space.

Companies that are growing and special to the space.

We really provide that opportunity.

Really it provides.

Opportunity.

Thanks, Adam and John for your comments.

Thanks Kurt.

Thank you I'm showing no further questions at this time I will turn the call back over to Adam Kumar for any closing remarks. Thank you very much for your participation in <unk> full year 2022 earnings call. We look forward to continued engagement and dialogue have a great day.

Thank you. I'm sure no further questions this time. Let's turn the call back over to Adam Kamor for any closing remarks.

Thank you very much for your participation in Opal Fuel in the year 2022 or INSCAL. We look forward to continuing engagement and dialogue. Have a great day.

Thank you. Ladies and gentlemen, this does include today's conference. Thank you all participating. You may now disconnect. Have a great day.

Thank you ladies and gentlemen, this does conclude today's conference. Thank you all participating you may now disconnect have a great day.

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for the fourth quarter and full Year 2022 earnings results conference call. At this time, all participants on Alyson Olymoid. After the speakers presentations, there'll be a question and answer session. To ask the question at that time, please press star 1-1 on your telephone.

Well fuels fourth quarter and full year 2022 earnings results conference call.

At this time all participants are in a listen only mode. After the speaker's presentation there'll be a question and answer session to ask a question at that time. Please press star one on your telephone.

As a remunetized conference call is being recorded, I would now turn the conference to you host, Mr. Todd Firestone, Vice President of Investor Relations. Please go ahead.

As a reminder, today's conference call is being recorded.

I would now like turn the conference host Mr. Todd Firestone Vice President of Investor Relations. Please go ahead.

Thank you and good morning everyone. Welcome to the Opel Fuels Sport Quarter and full year 2022 Erdingtcon.

Thank you and good morning, everyone welcome to the <unk> fourth quarter and full year 2022 earnings Conference call with me today are co Ceos on Komura, Jonathan Moore, and Anthony <unk>, Chief Financial Officer.

What's me today are co-seos and comora, John Comora, and Anthony Opel's chief financial officer.

Opal Fuels released financial and operating results for the fourth quarter and 12 months, either date of 2022, yet today afternoon. Those results are available on the investor relations section of our website at opalfuels.com.

Okay fuels released financial and operating results for the fourth quarter and 12 months a year to date of 2022 yesterday afternoon and those results are available on the Investor Relations section of our website at <unk> Dot com.

The presentation and access to the webcast for this call are also available on our website. After completion of this call, I replay will be available for 90 days.

The presentation and access to the webcast for this call are also available on our website. After completion of this call a replay will be available for 90 days.

Before we begin, I'd like to remind you that our remarks on this call including answers to your questions, contain forward-looking statements which involve RIFs, uncertainties, and a-

Before we begin I would like to remind you that our remarks on this call including answers to your questions contain forward looking statements, which involve risks uncertainties and assumptions.

for looking statements and not a game sheet performance and actual results could differ materially from what is contained in such things.

Forward looking statements are not a guarantee of performance and actual results could differ materially from what is contained in such statements.

Democrats that could cause and contribute to such differences are described on slide two and three of our presentations.

Factors that could cause or contribute to such differences.

On slides two and three of our presentation.

Please forward looking statements reflect our views as of the data that's called. And Opal Fuels does not undertake any obligations to update forward looking statements reflect events or circumstances after the data that's called.

These forward looking statements reflect our views as of the date of this call and <unk> does not undertake any obligation to update.

Forward looking statements to reflect events or circumstances. After the date of this call.

Additionally, this call will contain the discussion of certain non- GAAP measures , including but not limited to adjusted hemodop. A definition of non- GAAP measures used in a reconciliation of these measures for the nearest gap measure and included in the appendix of the relief and presentation.

Additionally, this call will contain discussion of certain non-GAAP measures, including but not limited to adjusted EBITDA a definition of non-GAAP measures used in a reconciliation of these measures to the nearest GAAP measure is included in the appendix of the release and presentation.

Adam will begin today's call by providing an overview of the fourth quarter results, recent highlights and the update on our strategic and operational priorities.

Adam will begin today's call by providing an overview of the fourth quarter results recent highlights an update on our strategic and operational priorities.

John will then give a commercial business development update after which Ann will review financial results in the full year 2023 guidance. We'll then open up the call for questions. Now I will send the call over to Adam Cormorra, Co-CEO of Opal Fuel.

John will then give a commercial and business development update after which Ann will review financial results and full year 2023 guidance.

We will then open up the call for questions and now I will turn the call over to Adam <unk> co CEO of Opal field.

Thank you, Todd. Good morning, everyone, and thank you for being here for Opal Fuel's fourth quarter and year end 2022 earnings call.

Thank you Todd good morning, everyone and thank you for being here for Opel fuels fourth quarter and year end 2022 earnings call.

2022 was a remarkable year for Opal Fuels filled with many achievements for our company as well as positive developments for the RNG industry as a whole. We are proud of what we've accomplished and we remain steadfast in our focus on executing on our plan. I'd like to...

2022 was a remarkable year for <unk> fuel cell with many achievements for our company as well as positive developments for the <unk> industry as a whole we are proud of what we've accomplished and we remain steadfast in our focus on executing on our plan.

I'd like to highlight several points.

First, we continue to execute on our strategic and operational priorities. We believe our integrated platform is a powerful model in delivering renewable, low-carbon RNG to the market.

We continue to execute on our strategic and operational priorities. We believe our integrated platform is a powerful model and delivering renewable low carbon RMG in the marketplace strategically our goal is to continue to grow our R&D production and to maximize the value of that RMG, which currently remains the U S.

strategically our goal is to continue to grow our RNG production and to maximize the value of that RNG Which currently remains the US transportation fuel market as the highest value distribution

<unk> fuel market as the highest value distribution.

Operationally, we remain committed to be the premier vertically integrated RNG company in the industry. One that excels at providing value to not only our shareholders, but also our customers and partners.

Operationally, we remain committed to be the premier vertically integrated R&D company in the industry, one that excels at providing value to not only our shareholders, but also our customers and partners.

Importantly, we think our visible and tangible growth profile is a differentiating factor in the market.

Importantly, we think are visible and tangible growth profile is a differentiating factor in the marketplace.

We grew our RNG output by more than a third this past.

We grew our RMG output by more than a third this past year.

As we disclose in our 2023 outlook, we expect growth to accelerate this year by greater than 50% over 2022 to more than 3.4 million MMBTUs at the midpoint of our guide.

As we disclosed in our 2023 outlook, we expect growth to accelerate this year by greater than 50% over 2022 to more than $3 4 million <unk> at the midpoint of our guidance our projects and construction remain on track, which provides visibility to accelerating production growth once again in <unk>.

Our projects and construction remain on track, which provides visibility to accelerating production growth once again in 2024 from 2023. In addition to production, our advanced development pipeline continues to grow and mature. And as John will touch on later, we have seen some of the development delays from 2022 ease, and we expect to place at least 2MMBTUs of output capacity into construction in 2023.

<unk> thousand 24 from 2023.

In addition to production or advanced development pipeline continues to grow and mature and as John will touch on later, we have seen some of the development delays from 2020 to ease and we expect to place at least 2 million btu's of output capacity into construction in 2023.

I want to touch on our vertical integration business model and our current views on environmental credit price.

I wanted to touch on our vertical integration business model and our current views on environmental credit pricing.

We continue to believe our business model both maximizes the value of our produced RNG and provides important flexibility and optionality in the future to capitalize on RNG tailwinds. Both new offtake markets and public policy initiatives as those evolve and strengthen.

We continue to believe our business model, both maximizes the value of our produced RMG and provides important flexibility and optionality in the future to capitalize on RMG tailwind, both new off take markets and public policy initiatives as those evolve and strengthen.

The US transportation fuel market continues to be the highest value off-take. Averaging twice the value of fixed price contracts, and again, leave us the option in the future to explore new end markets and test incremental pricing power with sleep cups.

The U S transportation fuel market continues to be the highest value offtake, averaging twice the value of fixed price contracts and again leave us the option in the future to explore new end markets and test incremental pricing power with fleet customers.

We do get a lot of questions on this merchant model and Anne will speak later about some of our business segments, fuel station services and renewable power and a long-term contract in nature of those business segments which mute some of the volatility by remaining merchant on our RNG product.

We do get a lot of questions on this merchant model and Ann will speak later about some of our business segments fuel station services in renewable power and the long term contracted nature of those business segments, which mutes some of the volatility by remaining merchant on our RMG production.

Having said that, let's dive into some of the recent dynamics in both D3 RIN pricing and LCFF's credit.

Having said that let's dive into some of the recent dynamics in both D. Three RIN pricing and <unk> credits.

On D3-Rin Dynamics, we see the recent drop in price being driven by the potential oversupply of cellulosic D3-Rin volumes in the proposed set rule introduced by the EPA in December of 2022, with rule finalization expected to occur in June of this year.

On <unk> dynamics, we see the recent drop in price being driven by the potential oversupply of Cellulosic D. Three wind volumes in the proposed set rule introduced by the EPA in December of 2022 with rule Finalization expected to occur in June of this year.

This potential over supplies driven by two factors. Continue growth in RNG production capacity, an additional supply from a proposed E-RIN path.

This potential oversupply is driven by two factors continued growth in <unk> production capacity and additional supply from the proposed <unk> pathway.

It is important to note that Oval Fules will see strong benefits from this E-Lynn pathway as our existing or noble power segment will be able to participate and generate significant incremental rins without investing new capital. We will be providing more clarity around this potential as the rules get finalized.

It is important to note that <unk> fuels will see strong benefits from this <unk> pathway as our existing renewable power segment will be able to participate and generate significant incremental returns without investing new capital, we will be providing more clarity around this potential as the rules get finalized.

On the demand side of D3 Rins, we remain optimistic that EPA RVO targets could be adjusted higher to a comparable say-aloxic supply additions, as well as anticipated E-RIN volumes as those rules become finalized.

On the demand side of <unk>, we remain optimistic that EPA RVO targets could be adjusted higher to account for both sale optics supply additions as well as anticipated he ran volumes as those rules become finalized.

It is the clear intent of both the original RFF and proposed rule commentary to support and grow the cellophic category.

It is the clear intent of both the original RFS and proposed rule commentary to support and grow the Cellulosic category.

The original law stated the say elastic D3 category was targeted to be 16 billion D3 rents and the EPA administration is meant to support growth up to that thing.

The original loss stated the Cellulosic D. Three category was targeted to be 16 billion D. Three wins in the EP and the EPA administration is meant to support growth up to that figure.

With updated industry production actuals over the past six months and demonstrated new supply growth coming online, the EPA has the support to raise volumes and has opened the door for future reenactment of the waiver credit over the multi-year set.

With updated industry production actuals over the past six months and demonstrated new supply growth coming online. The EPA has the support to raise volumes and has opened the door for future re enactment of the waiver credit over the multiyear set period.

It is important to remember why the law and EPA are so supportive of the say-aloft category. The source of this category of biofuels is capturing harmful methane emissions. The single most important thing we can do to combat climate change.

It is important to remember why the law and EPA are so supportive of the Cellulosic category. The source of this category of biofuel is capturing harmful methane emissions. The single most important thing we can do to combat climate change.

Another interesting feature of the proposed set roll is the multi-year RVO.

Another interesting feature of the proposed rule is the multiyear Rvo's. We believe that feature may dampen volatility in the future and perhaps open up two to four year contracts for Rins now that obligated parties will have visibility into their volume obligations for a multiyear period.

We believe that feature may dampen volatility in the future and perhaps open up two to four year contracts for RINs. Now that obligated parties will have visibility into their volume obligations for a multi-year period.

So from our perspective, we believe Opal will ultimately create more value from existing and future projects from the E-Rin pathway. And structurally, we may see new contracting opportunities from the multi-year RVF.

So from our perspective, we believe Opel will ultimately create more value from existing and future projects from the <unk> pathway and structurally we may see new contracting opportunities from the multiyear RVO.

Given this outlook, we are currently limiting our 2023 RIN sales in the first half of the year as rules are finalized and Anne will touch on later how that will roll through our financials and reporting.

Given this outlook. We are currently limiting our 2023 <unk> sales in the first half of the year as the rules are finalized and and we will touch on later, how that will roll through our financials and reporting.

As you see in our guidance sensitivities, we have much less exposure to <unk> pricing. Our Sonoma project has an offtake contract with a floor of $100 per credit and we have much less dairy production currently online versus landfill enel.

As you see in our guidance sensitivities, we have much less exposure to LCFS pricing. Our Sonoma project has an off-take contract with a floor of $100 per credit, and we have much less dairy production currently online versus land.

On LCFS though, we remain very optimistic on credit pricing and the direction that CARB has intimated it is heading to on proposed program changes to be finalized over the balance of 2023 for 2024.

Enel CFS, though we remain very optimistic on credit pricing and the direction that carb has intimated. It is heading to on proposed program changes to be finalized.

Over the balance of 2023 for 2024.

Carb is giving clear signals to the market they would like to encourage more investment by supporting pricing, which will likely include stronger compliance targets, creating incremental demand for LCFS credits starting next.

Carpets, giving clear signals to the market they would like to encourage more investment by supporting pricing, which will likely include stronger compliance targets, creating incremental demand for <unk> credit starting next year.

As we look to this year, we are introducing our 2023 Adjusted EBITDA guidance, which we expect to range from 85 to 95 million. Our RNG production range from 3.2 to 3.6 million MNB to use and capital expenditures to range from 220 to 240 million.

As we look to this year, we are introducing our 2023 adjusted EBITDA guidance, which we expect to range from $85 million to $95 million.

Our RMG production range from three two to $3 6 million <unk> and capital expenditures to range from $220 million to $240 million.

and will provide more detail, but we expect an $8 million change to 2023 of just the EBITDA for every 25 cent gallon change in D3 rent price.

And we will provide more detail, but we expect an $8 million change to 2023 adjusted EBITDA for every 25 gallon change in D. Three RIN prices.

We continue to benefit from substantial and broad-based developments in our industry. First, I'd like to provide some insight into how our thinking on the IRA has evolved over the last several months.

We continue to benefit from substantial and broad based developments in our industry first I'd like to provide some insight into how our thinking on the IRA has evolved over the last several months.

While we still await the final guidance from Treasury, we are confident that the IPC provisions will apply to Lanthill R&G projects, thus encompassing nearly all of our in construction and advanced development pipeline projects.

While we still await the final guidance from Treasury, we are confident that the ITC provisions will apply to landfill R&D projects, thus encompassing nearly all of our in construction and advanced development pipeline projects.

While we are still determining the exact level of ITC benefit, we have been in advance discussions with the appropriate advisors and counterparts to believe we will benefit significant.

While we are still determining the exact level of ITC benefit we have been in advanced discussions with the appropriate advisors and Counterparties to believe we will benefit significantly.

Second, the 45 Z credits are set to be in cocktail as well, and we expect clarity from Treasury in the coming months on that front.

Second the 45 Z credits are set to be impactful as well and we expect clarity from treasury in the coming months on that front.

We expect to begin realizing these benefits in 2023 and see them growing in 2024 and throughout the next five years.

We expect to begin realizing these benefits in 2023 and see them growing in 2024 and throughout the next five years.

2023 is set to be a very good year for Opal Fuels. To some degree, a bit of a contrast from 2022. In 2022, we saw very good commodity environmental credit pricing, but saw some near-term headwinds in the development of our new project pipe.

2023 is set to be a very good year for Opel fuels to some degree a bit of a contrast from 2022 in.

In 2022, we saw very good commodity environmental credit pricing, but saw some near term headwinds in the development of our new project pipeline.

In 2023, we have begun the year with lower near term commodity and environmental credit pricing, but see the positive momentum beginning with our new project development, which is ultimately the long term value driver of our business. With that, I'll turn it over to John . John , thank you.

In 2023, we have begun the year with lower near term commodity and environmental credit pricing, but see the positive momentum beginning with our new project development, which is ultimately the long term value driver of our business with that I'll turn it over.

John .

Thank you Adam and good morning, everyone.

I want to start out by saying that we are very focused on executing on our growth.

I wanted to start out by saying that we are very focused on executing on our growth plans.

We grew R&G production nearly 40% in 2022, and we expect to grow by more than 50%.

We grew our LNG production nearly 40% in 2022, and we expect to grow by more than 50% this year.

Our reconstruction portfolio's timing is progressing with a cadence, but is in line with our expectations.

Our construction portfolio is timing is progressing with a cadence that is in line with our expectations and we think sets us up for accelerated growth into 2024.

Think sets us up for accelerated growth into 20.

During 2022 are operating project portfolio increased from three to six projects and now seven with the just completed biotech dairy project in Indiana.

During 2022, our operating project portfolio increased.

three to six projects. And now seven with the just completed Biotown Theory Project.

In 2022, we commissioned three landfill RNG products.

In 2022, we commissioned three landfill RMG projects Global Road project in Ohio.

the noble road project in Ohio. Our new river project in Florida and the pine band project in Minnesota. These are in G projects represent 1.6 million M.M.B.T.U. of name plate RNG.

Our New River project in Florida, and the Pine Bend project in Minnesota.

Our LNG projects represented one 6 million Btu of nameplate RMG capacity.

At all three of these landfill projects, gas production continues to increase at the trash volumes there.

At all three of these landfill projects gas production continues to increase as the trash volumes there increase.

In addition to our operating projects, we currently have six RNG projects in construction with the Biotown Dairy RNG project having just entered the operation.

In addition to our operating projects. We currently have six R&D projects in construction with the bio town dairy RMG project, having just entered operations as we said.

Of these effects, we expect to Emerald to go online in the next several months.

Of these sects, we expect Emerald to go online in the next several months. Prince William in the fall.

William in the fall.

And Sapphire late in the year.

Our two dairy projects we expect to be commissioned in early 2024 and the Northeast land.

Our two dairy projects, we expect to be commissioned in early 2024 and.

In the northeast landfill later in 2024.

As Adam mentioned, we expect production increases this year from our operating and in construction portfolio that are in line with our prior expectation.

As Adam mentioned, we expect production increases this year from our operating and construction portfolio.

That are in line with our prior expectations with a $3 $4 million <unk> midpoint of production guidance.

the 3.4 million MMBTU midpoint of production guidance, being a 57% increase compared to RNG production in 2020.

A 57% increase compared to RMG production in 2022.

I want to pick up on what Adam mentioned earlier about development conditions easing. The good news is that the project developed

I wanted to pick up on what Adam mentioned earlier about development conditions easing.

The good news is that the project development logjam is breaking in.

conditions are improving in terms of moving projects forward compared with last year.

And conditions are improving in terms of moving projects forward compared with last year.

Recall that we described last year presented a number of challenges, which tended to delay projects as landfill owners assessed with substantial market dynamics surrounding the value of their R&D resource.

Recall that we described how last year presented a number of challenges which tended to delay projects as landfill owners assess

Dance on market dynamics surrounding the value of their RNG.

We provided some color on this topic on our third quarter call.

provided some color on this topic on our third quarter call.

Fast forward to today and we're already seeing improved.

Fast forward to today, and we're already seeing improvements.

We anticipate an acceleration of executed agreements for gas rights.

We anticipate an acceleration of executed agreements for gas rights and for construction contracts and that this acceleration should translate into progressing projects through our advanced development pipeline more quickly.

construction contracts and that this acceleration should translate into progressing projects through our advanced development pipeline more quickly and placing projects into construction as we progress through the year.

<unk> projects into construction.

We progressed through the year.

Since we last reported, we've added over 0.8 million MMVG of biogas toward Bansville and Pipeline, most of which is landfill, but also contains dairy and food waste products.

Since we last reported we've added over 400.

8 million Btu of biogas to our advanced development pipeline.

Of which is landfill, but also contains dairy and food waste projects.

projects are ones that we have qualified and that we reasonably expect can be into construction within the next 12 to 18 months.

These projects are ones that we are qualified.

We reasonably expect can be into construction within the next 12 to 18 months.

I'd also remind listeners that our advanced development pipeline does not include other earlier stage projects, which we continue to evaluate.

I'd also remind listeners that our advanced development pipeline does not include other earlier stage projects, which we continue to evaluate.

As one of the largest R&G players in the sector, we tend to see most of the projects in the marketplace.

He was one of the largest R&D players in the sector, we tend to see most of the projects in the marketplace.

all of which makes our pipeline dynamic and growing as we screen for the best opportunity.

All of which makes our pipeline dynamic and growing as we screen for the best opportunities.

Our overall development funnel continues to see positive momentum and provides opportunities in excess of what qualifies as our dance development.

Our overall development funnel continues to see positive momentum and provides opportunities in excess of what qualifies as our vast development pipeline.

Hope all fuels is on track to commence construction of 53 fueling stations.

Okay fuels is on track to commence construction of 53 fueling stations this year.

approximately 24 Opal Fuels owned stations and another 26th third party.

Approximately 24 fuels owned stations and another 26 with third parties.

Our overall RNG tool dispensing volumes are expected to grow to approximately 55 million gallons this year from nearly 30 million

Our overall RMG fuel dispensing volumes are expected to grow to approximately 55 million gallons. This year from nearly 30 million gallons in 2022.

terms of our landfill gas to electric projects, OPPO fuels owns and operates 19 landfill gas to electric projects, representing about 124 megawatts of nameplate capacity.

In terms of our landfill gas to electric projects April fuels owns and operates 19 landfill gas to electric projects, representing about 124 megawatts of nameplate capacity.

Recall that we began developing this portfolio of 25 years ago back in 1998.

All that we began developing the sport fully on 25 years ago back in 1998.

Well, six of these projects are candidates for conversion to RNG projects. The majority will remain.

All six of these projects are candidates for conversion to R&D projects.

The majority will remain electric projects.

The EPA has recently proposed E-Ren pathway to substantially increase the value of these projects.

The EPA has recently proposed he ran pathway scales to substantially increase the value of these projects.

Adding over $300 per megawatt hour gross to the existing values of these projects.

Adding over $300 per megawatt hour growth.

The existing values of these projects, which has the potential to substantially increase the EBITDA from this business segment.

the potential to substantially increase the EBITOP from this business segment, depending on e-ring sharing.

Pending on the ran sharing.

When price.

We await updated guidance from the EPA on this topic, which is...

We await updated guidance from the EPA on this topic, which is which is expected in the next few months.

In the meantime, we are positioning ourselves to meet this market opportunity by continuing discussions with auto manufacturers.

In the meantime, we were positioning ourselves to meet this market offer.

by continuing discussions with auto manufacturers who are proposed to create these e-Rins through the e-D data that they collect.

Posed to create these <unk> through the EV data that they collect.

As we highlighted early on, continued industry consolidation remains a significant tailwind for the R&G industry and certainly for Opal Fuel.

As we highlighted early on continued industry consolidation remains a significant tailwind for the RMG industry and certainly for <unk>.

<unk> fuels.

We'd highlight recent upstream and downstream transactions that acted as additions to existing upstream as-

We'd highlight recent upstream and downstream transactions that acted as additions to existing upstream infrastructure.

We think those acquisitions tend to support how industry players are thinking about the value of integration.

We think those acquisitions tend to support how industry players are thinking about the value of integrates.

Some of the thinking driving this consolidation revolves around how demand expectations for RNG are expected to shift over the next several years.

Some of them thinking driving this consolidation revolves around how demand expectations for RMG are expected to shift over the next several years.

We're already seeing the beginning of this trend with demand growth from utility.

We're already seeing the beginning of this trend with demand growth from utilities in the form of RMG mandates for power generation as well as the increasing demand in European end markets.

in the form of RNG mandates for power generation, as well as increasing demand in European end markets. And many expect increasing demand coming.

We expect increasing demand coming from Asia.

Separately hydrogen producers are seeking low carbon sources of renewable methane and our portfolio production assets and fueling stations.

Separately hydrogen producers are seeking low carbon sources of renewable methane and our portfolio of production assets and fueling stations is well positioned to take advantage as that market moves forward.

well positioned to take advantage as that market moves forward.

I'll now turn over the call to Anne to discuss our fourth quarter and your end financial results.

I'll now turn it over the call to Ann to discuss our fourth quarter and year end financial results.

Thank you, John , and good morning to all the participants on today's call. Last night, we filed our earnings press release, which detailed our quarterly and year end results for the period ending December 31st, 2022. We anticipate filing our 10K in the next day. Thank you.

Thank you John and good morning to all the participants on today's call.

Last night, we filed our earnings press release, which details our quarterly and year end results for the period ending December 31 2022.

We anticipate filing our 10-K in the next day or so.

We saw strong growth in two of our three business segments, RNG fuels and fuel station services. The biggest driver of the quarter and year-to-date results is RNG fuels, where we are starting to see the contribution from the RNG projects that have come online in 2022.

We saw strong growth in two of our three business segments, R&D fuels and fuel station services. The biggest driver of the quarter and year to date results is RMG fuels, where we are starting to see the contribution from the RMG projects that have come online in 2022.

We saw strong topline growth for the fourth quarter with revenue up 42% year over year, driven primarily by higher volumes produced and sold in the R&D fuel segment as well as higher prices for brown gas and higher Rins under forward sales contracts, we had entered into earlier in 2022.

We saw strong top line growth for the fourth quarter, with revenue up 42% year-over-year, driven primarily by higher volumes produced and sold in the RNG fuel segment, as well as higher prices for brown gas and higher rims under forward sales contracts, we had entered into earlier in 2022.

These benefits were partially offset by higher cost of sales due to electric utility costs and employee costs to support our growth, as well as higher royalties driven by higher energy revenue.

These benefits were partially offset by higher cost of sales due to electric utility costs and employee costs to support our growth as well as higher royalties driven by higher energy revenues.

G&A costs for the fourth quarter to have a $14 million reflecting transaction and other costs of which $10 million is considered one time.

G&A costs for the fourth quarter totaled $14 million, reflecting transaction and other costs of which $10 million is considered one time.

As a result, we generated net income in the fourth quarter of $32 million.

As a result, we generated net income in the fourth quarter of $32 million.

For the full year 2022, before considering the impacts of preferred dividends, we achieved net income of $32.6 million. Reflecting the standalone results for Opal Fools LLC and ArcLite Clean Transition Corp 2 through the closing of our business combination last July 21st. Plus the combined operations since.

For the full year 2022, before considering the impact of preferred dividends, we achieved net income of $32 6 million.

Reflecting the Standalone results for <unk> LLC and are quite clean transition corp to through the closing of our business combination last July 21.

The combined operations since then.

Consistent with the results we saw in the fourth quarter, we benefited from pricing for environmental attributes that we had locked in the forward sales early in 2022, coupled with higher commodity prices.

Consistent with the results we saw in the fourth quarter, we benefited from pricing for environmental attributes that we had locked in via forward sales early in 2022, coupled with higher commodity prices.

Looking at fourth quarter results compared to the third quarter RMG production remained constant at $6 million <unk>, which represents volumes net to Opel fuels adjusted.

Looking at fourth quarter results compared to the third quarter, RNG production remained constant at 0.6 million MMBT use, which represents volume net to open.

Adjusted Iida was 20.1 million in the fourth quarter versus 25.5 million in the third

Adjusted EBITDA was $21 million in the fourth quarter versus $25 5 million in the third quarter.

The difference was primarily the result of the previously disclosed $3 million gain from the bio-town debt associated with monetizing and in the money LCFS off-take contract.

The difference was primarily the result of the previously disclosed $3 million gain from the buyouts found yet.

Located with monetizing an in the money Lcs.

Offtake contract. We also do experience some seasonality with some of our downstream fueling customers that see heavier volumes in the summer months.

We also do experience this seasonality with some of our downstream fueling customers that see heavier volumes in the summer months, along with some timing associated with downstream fuel station construction projects.

Long with some timing associated with downstream fuel station construction contract.

We reported adjusted EBITDA of $22 million for the fourth quarter and $67 million for the 12 months ended December 31 2022.

We reported adjusted EBIDA of $20.2 million for the fourth quarter and 60.7 million for the 12 months ended December 31st, 2022.

Adjusted evidum benefited from the same drivers we discussed above. Higher environmental attribute pricing and commodity pricing offset by higher cost of sales and higher royalties.

Adjusted EBITDA benefited from the same drivers we discussed above.

Environmental attribute pricing and commodity pricing offset by higher cost of sales and higher royalties.

Fourth quarter adjusted EBITDA excludes several one time items, including an unrealized loss related to our warrant exchange we completed in December .

Fourth quarter adjusted eva. Excludes several one time items, including an unrealized loss related to our warrant exchange. We completed in December .

We also had a number of one-time costs related to going public that occurred during the fourth quarter and throughout 2022, which are excluded from adjusted eva d'as.

We also had a number of onetime costs related to going public that occurred during the fourth quarter and throughout 2022, which are excluded from adjusted EBITDA.

As of December 31, we had $167 $8 million of outstanding borrowings net of deferred financing costs, including $94 3 million of outstanding borrowings under our term loan a.

As of December 31st, we had $167.8 million about standing borrowings, net of disperge financing costs, including 94.3 million about standing borrowings under TermLode A, 28.5 million related to the remaining amount of the convertible note we had issued to Aries for the acquisition of the Imperial and Greentree projects in 2021.

$28 $5 million related to the remaining amount of the convertible note issued to Ares for the acquisition of the Imperial and Greentree projects in 2021.

22.1 million under the Sonoma loan, and 22.8 million related to our renewable power projects in Am.

$22 1 million under this genome alone and $22 8 million related to our renewable power project financing.

Our second term loan, which we closed in August , and which will finance a portfolio of RNG projects that are, or shortly will be, in construction, remains undrawn.

Our second term loan, which we closed in August and which will finance a portfolio of R&D projects that are we're certainly we'll be in construction remains undrawn.

As of December 31, our liquidity position was $257.2 million.

As of December 31, our liquidity position was $257 2 million, including $44 million of cash and cash equivalents $36 8 million of restricted cash $65 million of short term investments and $115 million of undrawn capacity under our term loans.

including 40.4 million of cash and cash equivalents, 36.8 million of restricted cash, 65 million of short-term investments, and 115 million of under-hung capacity under our term list.

We did recently draw down the final $10 million remaining under Termalone 1.

We did recently drawdown the final $10 million remaining under term loan line.

I will also note that we did not have any exposure to either Silicon Valley Bank or signature bank. So we were spared any of the associated distraction that many other growth companies have been dealing with in the past few weeks.

I will also note that we did not have any exposure to either Silicon Valley bank or signature bank. So we were spared any of the associated distraction that many other growth companies have been dealing with in the past few weeks.

We expect these existing sources of liquidity to be sufficient to fund the company's construction and development capital needs for the next 12 months.

We expect these existing sources of liquidity to be sufficient to fund the companys construction and development capital needs for the next 12 months. We also anticipate that significant capital continues to be available for deployment in the R&D space.

We also anticipate that significant capital continues to be available for deployment in the RNG.

As a newly public company, we are very focused on how best to attract long-term indos.

As a newly public company, we are very focused on how best to attract long term investors.

the OPL team continues to believe that the most powerful way to do this is to deploy capital effectively and demonstrably grow earnings power. Before turning the call over for Q&A.

<unk> team continues to believe that the most powerful way to do this is to deploy capital effectively and demonstrably grow earnings power.

Before turning the call over for Q&A.

I'd like to discuss our 2023 guidance.

I will note that all guidance is current as of the published date, is subject to change and we undertake no obligation to update.

I will note that all guidance is current as of the published data.

Is subject to change and we undertake no obligation to update it.

As Adam noted earlier, we anticipate our full year 2023 adjusted EVA.Guidance range to be 85 million to 95 million, which is based on our expected range of RNG production in 2023 of 3.2 million to 3.6 million MMBTU.

As Adam noted earlier, we anticipate our full year 2023, adjusted EBITDA guidance range to be $85 million to $95 million, which is based on our expected range of RMG production in 2023 of $3 2 million to $3 6 million and then Btu.

Our adjusted EBITDA outlook is predicated on several key pricing assumptions, such as $2 25 per gallon for G. III ran $90 per ton Lcs, that's credit price and $3 for MN Btu Brown gas.

Our adjusted EBITDA Outlook is predicated on several key pricing assumptions, such as $2.25 per gallon for D3-RIN, $90 per ton, LCFS credit price, and $3 per MMDTU brown.

This quarter, we also included detail on the impact of commodity price changes to our full year revenue and adjusted EBITDA outlook. We expect an approximately $8 million change to 2023 adjusted EBITDA for each 25 cents per gallon change in D3-Rin price.

This quarter. We also included detail on the impact of commodity price changes to our full year revenue and adjusted EBITDA outlook, we expect an approximately $8 million teams to 2023 adjusted EBITDA for each 25 per gallon teams and deep <unk> RIN price.

A $1 $4 million change for every 50 per <unk> <unk> change in natural gas price and a $400000 change for every $10 per metric ton teams and Lcs that's credit priced.

A $1.4 million change for every 50 cent for MMBTU change in natural gas price. And a $400,000 change for every $10 per metric ton change in LCFS credit price.

We are also updating our guidance for our portion of capital expenditures, excluding acquisition costs and net of any partner capital contributions to 220 million to 240 million dollars.

We are also updating our guidance for our portion of capital expenditures, excluding acquisition costs and net of any partner capital contribution to $220 million to $240 million.

Our guidance does include some assumptions about the amount of ITC we can monetize in 2023. We await, like everyone else, who follows the RNG space, definitive guidance from Treasury. Our specific disclosure will be limited until we have that clarity.

Our guidance does include some assumptions about the amount of ITC, we can monetize in 2023.

We like everyone else, who follows the R&D space definitive guidance from Treasury. So our specific disclosure will be limited until we have that clarity all of our <unk> benefits will be recognized as income likely in other income, but a reminder, that these are real cash proceeds not just cash tax avoidance.

All of our IRA benefits will be recognized as income, likely in other income, but a reminder that these are real cash proceeds, not just cash tax avoidance. Hence, the recognition is income, which is expected to continue for at least five years.

Hence the recognition as income which is expected to continue for at least five years.

As a reminder, in accordance with GAAP ASC 606, we can only recognize revenue and the related earnings from environmental attributes. Once they are sold to transfer and accepted by the counterparty we present the value of store gas and unsold environmental attributes as part of adjusted EBITDA to allow the REIT.

As a reminder, in accordance with GAP ASC 666, we can only recognize revenue and the related earnings from environmental attributes once they are sold to, transferred, and accepted by the counterparty. We present the value of stored gas and unsold environmental attributes as part of the justice Iida to allow the reader to understand the value and timing of production.

To understand the value and timing of production.

We will continue to report our adjusted EVA DAW with visibility as to stored gas and credits. As we anticipate, only selling a minority of our production in the first pass of 2023, while we await EPA's updated RV.

We will continue to report our adjusted EBITDA with visibility as historic gap in credits as we anticipate only selling a minority of our production in the first half of 2023, while we await epa's updated RVO.

As a result, revenue and net income will be lower for the first half of the year, with 2023 results being skewed to the latter half of the year.

As a result.

Revenue and net income will be lower for the first half of the year with 2023 results being skewed to the latter half of the year.

Again, the Ivotage Ividah adjustment is intended to levelize this reporting and match inventory produced within the period cost a record.

Again, the EBITA EBITDA adjustment is intended to level wise this reporting and match inventory produced within the period costs are recognized.

Finally, going forward for 2023, we will be presenting the revenues and expenses associated with our CNG tolling business in fuel station services.

Finally going forward for 2023, we will be presenting the revenues and expenses associated with our CMG tolling business in fuel station services as noted earlier.

Opal owns and operates a number of dispensing stations where we dispense the fuel and service the location for a customer. This activity had been reported in the RNG fuel segment in 2022 and prior periods.

<unk> owns and operates a number of dispensing stations, where we defense the fuel and service the location for our customer.

This activity had been recorded in the R&D fuel segment in 2022 and prior periods.

Going forward, we will include this in the fuel station service segment to better differentiate between the business activities and value drivers in the upstream and downstream portions of our business. And facilitate easier comparisons, appears in our

Going forward. We will include this in the fuel station services segment to better differentiate between the business activities and value drivers in the upstream and downstream portions of our business and facility easier comparisons to peers in our space.

Adding to that, although we are labeled as a merchant play due to our exposure to the volatility inherent in environmental attributes, there are several earning streams in this business that dampen volatility.

Adding to that although we are labeled as a merchant play due to our exposure to the volatility inherent in environmental attributes. There are several earnings streams in this business that dampened volatility.

Our renewable power businesses predominantly contracted under long-term power purchases.

Our renewable power business is predominantly contracted under long term power purchase agreements.

The Fuel Station Services Business is profitable and growing, supported by 10-year contracts, both service and fuel supply agreements, as well as construction revenue from stations we build, which provides visibility out for roughly 12 months. The net effect of these two key business segments provides recurring stable earnings and cash flow, which dampens our overall corporate volatility from changing environmental credit marks.

The fuel station services business is profitable and growing supported by 10 year contracts, both service and fuel supply agreements as well as construction revenue from stations, we built which provides visibility out for roughly 12 months. The net effect of these two key business segments provides recurring stable.

Earnings and cash flow, which dampened our overall corporate volatility from changing environmental credit market.

With that, I'll turn it back to John and Adam for concluding remarks.

With that I'll turn it back to Jonathan Adam for concluding remarks.

Thank you Amy.

Thank you, Ann. In closing, we believe our future is bright. We continue to add new projects and advance projects through our development funnel into operations with accelerating growth and...

In closing, we believe our future is bright.

We continue to add new projects.

Advanced projects through our development funnel into operations with accelerating growth in gas production and distribution.

While the world around us continues to lean into this...

While the world around us continues to lean into this sector.

continue to carry forward Opel's vertically integrated mission.

We're continuing to carry forward <unk> vertically integrated mission.

Build and operate. Best in class, RNG facility.

To build and operate best in class R&D facilities.

that deliver industry leading, reliable, and cost effective R&G solutions.

That deliver industry, leading reliable and cost effective R&D solutions.

Just place fast off your and mitigate climate change.

Displace fossil fuel and mitigate climate change.

And with that, I'll turn the call over to the operator for Q&A. Thank you all for your interest.

And with that I'll turn the call over to the operator for Q&A.

You all for your interest in Opal fuels.

Thank you. Again, ladies and gentlemen, if you'd like to ask a question, please press star 11 on your telephone. Again, to ask a question, please press star 11. Our first question comes from Derek Woodfield.

Great.

Thank you again, ladies and gentlemen, if you'd like to ask a question. Please press star one on your telephone again to ask a question. Please press star one win.

Our first question comes from Derrick Whitfield with Stifel. Your line is open.

part

Thank you.

Thank you.

Okay.

Pardon me Mr <unk> Okay.

Yes, hello, good morning all and congrats on the successful first years of public company, certainly in a difficult operating environment. Thanks, dear. For my first question, I wanted to lean into your prepared comments on the progression of your backlog both near term and medium term. For 2023, it appears that Emerald, Prince William and staff, our projects are all progressing along the schedule you laid out in Q3.

Yes, Hello, good morning, all and congrats on a successful first year as a public company certainly in a difficult operating environment.

Yes.

Thanks Derek.

Yes.

My first question I wanted to lean in and to your prepared comments on the progression of your backlog both near term and medium term for 2023. It appears that Emerald Prince William and Sapphire projects are all progressing along the schedule you laid out in Q3.

Looking beyond 2023 could you place some parameters on the amount of project capacity from your advanced development pipeline that could be placed on production in 2024 based on the improving operating conditions you're experiencing.

and play some parameters on the amount of project capacity from your advanced development pipeline that could be placed in production in 2024, based on the...

Good morning, Derek. Sure. Yeah, so we have a

Good morning, Darren sure.

So we have.

Advanced development pipeline of a little over 8 million MNBTUs named Lake Pasity of gas available. And as we continue into 2024, we see our dairy projects and the Northeast landfill project that we place in the construction last year coming online. Because of like,

Advanced development pipeline of a little over 8 million MMP to use.

The nameplate capacity.

Gas available.

And as we continue into 2024, we see our dairy projects.

The northeast landfill projects that we placed into construction last year coming online.

Because of Lockdown.

projects going into construction. There will be fewer coming online next year beyond that, but the projects that we place into construction this year will go online in about 18 months or so, would be your average construction time frame from permits for the construction till you start seeing the gas production.

Projects going into construction.

There will be fewer coming online next year beyond that but the projects that we placed into construction. This year will go online in about 18 months or so would be your average construction timeframe from commencement of construction.

So you start seeing the gas production.

could be a little faster, could be a little bit slower. So we'll see gaps from the projects that are going online this year continue to increase our output.

Little faster could be a little bit slower. So we'll see jobs from the projects that are going online. This year continue to increase our output.

During 2023, and 2024 of those projects come online.

During 2023 and 2024, those projects come online.

And then I will see the project putting into construction. This year started to contribute during the really late 2024, 2025 time.

And then we will see.

<unk>.

Projects, putting into construction this year start to contribute during the.

It really took late 2020 for 2025 timeframe.

Yeah, the only thing I would add there is obviously we'll have a full year production in 24 on the Emerald project that goes in a couple of months and you'll also get a full year output from the two in the in the later half of this year. And that's really visible growth and accelerates production from 23 into 24.

Yes, I think the only thing I would add there is.

Obviously, we will have a full year of production in 'twenty four.

Emerald project that goes in.

And a couple of months and you'll also get.

Full year output from.

The two.

In the later half of this year and Thats.

No really visible growth and accelerate production from 2020.

<unk> thousand 324.

Terrific color and then as my follow up I wanted to focus on the implications of the IRA to your business referencing slides 13, and 14, you arguably have more optionality in your portfolio than ever before as a result of the IRA.

and then as my follow up I wanted to focus on the implications of the IRA

Referencing slides 13 and 14, you arguably have more optionality in your portfolio than ever before is the result of the IRA.

As you assess your RNG, Iran, and hydrogen up.

As you assess your R&D ran into hydrogen opportunities how does the <unk> pathway impact your view on the allocation of capital between R&D and electricity with the understanding that the time is likely your friend based on the growth of Evs relative to landfill gas and then more specifically for 2023 guidance could you comment on the degree of ITC embedded.

How does the ERA and Pathway impact your view on the allocation of capital between R&D and LH?

The understanding that time is likely your friend based on the growth of EVs relative to landfill gas. And then more specifically for 2023 guidance.

comment on the degree of ITC embedded in your project.

In your projections.

Yeah, I'll let Anne handle the ITC one first, and then I'll talk a little bit about some of the regulatory stuff happening both in terms of IRA and the even FATLIC. Yeah, thanks, Sarah. It's, and so as I had commented, you know, I think given the fact that we're still leading for additional guidance from Treasury, which we expect.

Yes ill, let Dan handle the ITC, one first and then I'll talk a little bit about some of the regulatory stuff happening both in terms of IRA uneven pathway, yes. Thanks, Eric.

So as I had commented.

I think given the fact that we're still waiting for additional guidance from Treasury, which we expect to come most likely in Q2.

to come most likely in Q2. We're being a little circumfect in terms of the specific amounts and details of what we've included in adjusted EBITDA for IEC.

Being a little circumspect in terms of the specific amounts and details of what we've included in adjusted EBITDA for ITC.

I think we are making some underlying assumptions obviously about the projects that are in construction and that we'll see OD this year. But beyond that, I think at this point, we're not really ready to disclose my-

I think we are making some underlying assumptions obviously about the projects that are in construction and that will CRB this year, but beyond that.

I think at this point, we're not really.

Ready to disclose much more than that.

Yes sure.

Yeah, and as far as some of the other, this is Adam here, as far as some of the other public policy stuff that we see happening, in addition to the IEC, which will get some clarity on. We're also expecting in 2023 to get some clarity around 45 decalculations and how carbon intensity scores may be allocated.

Some of the other this is Adam here as far as some of the other public policy stuff that we see.

Happening.

In addition to the ITC.

Which we'll get some clarity on we're also expecting in 2023 to get some clarity around the 45 day calculations in our carbon intensity scores may be allocated.

We think that's going to be really impactful specifically for

We think that's going to be really impactful specifically for.

you know, the heavy negative CI kind of gaps, but we need to see a little bit more clarity to really get a better understanding on that. The E-RIN patch, when we think is really interesting for our business, and opens up all sorts of incremental.

The heavy negative Ci.

Gas, but we need to see a little bit more clarity to really get a better understanding on that.

<unk> pathway, we think is really interesting for our business.

And.

Opens up all sorts of incremental profitability opportunities on our existing landfill gas to electric projects and how we think about some of the new project development and what kind of opportunities that may open up.

opportunities on our existing land-to-cap electric projects and how we think about some of the new projects available and what kind of opportunities that may open up.

And you know, it is a little uncertain in the timing of when they may finalize that rule. The EPA has received a number of comments back in February , so we'll see whether or not they're going to give that clarity in June . When we do expect, you know, perhaps we'll look at the RVO volume.

And it is a little uncertain on the timing of when they may finalize that rule.

EPA has.

<unk> received a number of comments back in February So we will see.

Whether or not they're going to give that clarity in June when we do expect.

Perhaps when you look at the RVO volumes, whether or not that's going to include finalized rules on the ear Enzo that may slip it into later in 2023.

whether or not that's going to include finalized rules on the e-Rins. So that may slip into later in 2023.

You know, as we think about it from a capital perspective on what makes an R&G project versus a landfill gas electricity project, we like having the optionality for all these new and market that are opening up that you mentioned, whether it not be hydrogen or quite frankly a lot of export markets that are opening up.

We think about it from a capital perspective on what makes an LNG project versus a landfill gas electricity project.

We like having the Optionality for all these new end markets that are opening up that you mentioned, whether or not be hydrogen or quite frankly, a lot of export markets that are opening up.

So we like the idea if we can see good risk adjusted returns on a capital for an RNG project to continue to deploy capital and have that flexibility of offtake whether it be you know, the new six voluntary markets or strengthening voluntary markets. So...

So we like the idea if we can see good risk adjusted returns on capital for an R&D project to continue to deploy capital and have that flexibility of off take whether it be new fixed voluntary markets are strengthening voluntary market. So.

We see it as a big additive to our business overall and on the land, so existing land, so Gatsal Electric Projects, obviously that would be incremental profitability without having enough of that new capital. So, you know, we're excited about the prospects for it and we'll see, you know, the timing for when they finalize that rule. That's great.

We see this as a big additive to our to our business overall and on the landfill existing landfill gas to electric projects, obviously that would be incremental profitability without having to invest new capital. So.

We're excited about the prospects for it and we will see.

The timing for when they finalize that role.

Okay. That's great. Thanks for your time and comments.

Thank you one moment please.

Our next question comes from the line of Ryan Todd of Piper Family and line of Open. Good thing.

Our next question comes from the line of Ryan Todd of Piper Sandler Your line is open.

Great. Thanks.

Congrats on the result, and let me.

I apologize that a conflict and missed some of your earlier comments, so I hope.

I apologize that I conflict and missed some of your earlier comments I hope I am.

I'm not sure if you address them in a circle in the call, but um...

Not sure if you addressed some of this earlier in the call but.

It's been a challenging stretch for many in the RNG industry in terms of project execution, getting volumes delivered on time and budget.

It's been a challenging stretch for many of the LNG industry in terms of project execution getting volumes delivered on time and budget.

What have been the biggest challenges for you on the project execution side? I guess both on dairy and landfill. And are those things improving? Can you talk about how maybe parts of the supply chain and your ability to execute on your significant backlog is improving going forward and what has improved.

What are the what are the biggest challenges for you on the project execution side I guess, both on dairy and landfill and are those things improving can you talk about how maybe parts of the supply chain and your ability to execute on your significant backlog is improving going forward.

And what what has improved if anything.

Hey, good morning, Ryan. This is John Moore. I'll start at this point. I think we reported.

Hey, Good morning, Ryan This is John more of I'll start this one off.

I think we reported last quarter.

There was a slowdown in execution of contract, the movement through the pipeline as land sales.

There was a.

A slowdown in execution of contracts the movement through the pipeline.

Landfills realized the value of the RMG inherent in their landfills.

realized the value of the RNG inherent in their land bills. And each of the major land bills and many of the smaller ones took the opportunity to reassess how they wanted to approach that value proposition.

Each of the major landfills and that it was borrowers took the opportunity to reassess.

They wanted to approach.

So <unk> proposition.

So that's resulted in a bit of delay, but I think there's through that process.

So that resulted in a bit of a delay, but I think they're through that process and we're seeing a lot of movement through our advanced development pipeline and progress there.

And we're seeing a lot of movement through our advanced development pipeline and progress there. So, you know, conservatively, we think that we'll put 2 million MMVT into construction this year. Our overall pipeline, we've reported an 8 million. We think there's great opportunity to accelerate that. But we want to stay conservative on the outset and really update our.

No.

Conservatively, we think.

We will put $2 million <unk> in the construction this year, our overall pipeline we've reported a $8. We think there's great opportunity to accelerate that but we want to stay conservative on the outset and really update are.

projections and guidance to you as we execute on those projects in that way.

Projections and guidance to you as we execute.

On those projects.

And is there anything on the supply chain side of things that is problematic at this point or has that moderated to a level that it's not an issue anymore.

Sure.

In terms of acquiring equipment, there's been a little bit of lead time.

In terms of acquiring equipment.

There has been a little bit of.

Lead time.

up to that, but most of that is dissipated and that there's plenty of opportunity to get the equipment that we need to build out our project. So nothing material there that we're seeing right now.

But most of the anticipated.

There's plenty of opportunity to get the equipment that we need to build out our projects. So.

Nothing material there.

We're seeing right.

Great. Thanks, maybe.

You know shifting gears from you know, conversations with investors liquidity.

Shifting gears.

From conversations with investors liquidity.

and your stock remains a challenge, even for those that are positive on the story and the valuation. And can you talk about what options you may have to address currently quitting the stock, what sort of timeline might be possible? And...

And your stock remains a challenge.

For those that are that are positive on the story and the valuation can you talk about what options you may have to address current liquidity in the stock what sort of.

Timeline might be a possible and how.

You know, how much of focus is this or is this an issue where we just have to, you know, grow the EBITDA in the earnings and...

How much.

Our focus is this or is this an issue where we just have to grow the EBITDA and the earnings.

Move things along that way, yes. This is Adam here.

Yeah, this is this is Adam here and I will say we we hear similar questions when we have our investor meetings

I will say, we we hear similar questions when we have our investor meetings.

where people are really positively disposed to R&G and really like the old story. And maybe, you know, would like to see more liquidity in our stock. I'll answer a couple of different ways. One is...

People are really positively disposed to RMG and really like the story.

And maybe.

We'd like to see more liquidity in our stock.

I'll answer a couple of different ways one is.

You know, we don't need to do any primary shares. Once we've got enough liquidity in place and capital raising plans in place to continue to execute on our development pipeline. So there's no need to raise.

We don't need to do any primary share issuance, we've got enough liquidity in place.

Capital raising plans in place to continue to execute on our development pipeline. So there is no need to raise.

Capital for primary share is from a secondary share issuance, you know, I'd say like most management teams We feel our shares, you know offer compelling value years. So I don't know if there's a lot of interest Currently on a secondary and don't have any needs plans in place

Capital from our primary share issuance from our secondary share issuance.

I'd say like most management teams, we feel our shares.

Offer a compelling value year. So I don't know if theres a lot of interest are currently on a secondary and we don't have any immediate plans in place.

You know, we do think that there could be some opportunities to increase the flow with smaller talking acquisitions and perhaps.

We do think that there could be some opportunities to increase the float we have.

Smaller tuck in acquisitions and perhaps.

Yes.

increase the liquidity in both that way. We are, you know, going to spend, you know, continue to ratchet up time spent with investors and analysts and thinking about, you know, analysts or investor day later in the year. So we will be visible and try and increase the visibility of local fuels, but we don't currently have anything on the table for either a primary or a secondary. Okay. Great.

Increased liquidity inflows that way.

We are going to spend.

Continue to ratchet up time spent with investors and analysts and thinking about.

An analyst or Investor Day later later in the year, So we will be visible and try and increase the visibility of Opel fuel but.

But we don't currently have anything on the table for either a primary or secondary.

Okay, great. Thank you.

Thank you one moment please.

Our next question comes from the line of Matthew Blair of Tudor Pickering Holt Company. Your line is open.

Our next question comes from the line of Matthew Blair of Tudor Pickering and Holt Company, a line of...

Hey, good morning, Adam, John , and Ann. Hope you're doing well. Could you share any thoughts on how Q1 is progressing? Seems like you would have some volume and potentially margin benefit from the start-up at the Biotown dairy, but then headwinds from lower D3-Rin prices as well as rolling off the locked-in D3-Rin from last year.

Good morning, Adam John and hope you're doing well.

Could you share any thoughts on how Q1 is progressing.

Like you would have some some volume and potentially margin benefit from the startup of the <unk>, but then headwinds from lower <unk> prices as well as rolling off the locked in <unk> from last year.

Does that sound about right? Is there anything else that we should be thinking about in regards to Q1? And at this stage can you say if Q1 EBITDA is likely to be higher or lower, quarter to quarter?

Does that sound about right is there anything else that we should be thinking about in regards to Q1 at this stage can you say if Q1 EBITDA.

It is likely to be higher lower quarter over quarter.

So I can take that and then others can jump in. So obviously, we're just reporting 2022 here. We've given initial guidance. We'll be reporting Q1 in the, call it next, I don't know, six weeks or so.

So I can take that and then others can jump in so obviously.

We're just reporting 2022 here, we've given initial guidance will be reported in Q1, and then call. It next.

Six weeks or so.

But I think, you know, everything that you said there, I generally agree with. I think from our perspective, we are seeing gas production going in the right direction, right? It's growing. The caveat, first of all, by our count, we are a minority owner.

But I think.

Everything that you said there.

Generally agree with I think from our perspective, we are seeing gas production going in the right direction rate is currently.

The caveat that you can see.

First of all higher count we are minority owner.

So, you know, we will see an equity pickup in our results for that, but it's not under our direct control. The second piece is, as I highlighted in my comment, you know, from a rent and else give us perspective, we anticipate in the first half of the year that will be called admittable sellers, right? You know, just enough to manage the business, but clearly we see value. So our results will be skewed to the latter half of 23.

No.

We will see an equity.

Thanks for that.

It's not under our direct control the second piece is as I highlighted in my comments.

From a branding perspective, we anticipate in the first half of the year and it will be I'll call. It.

Minimal sellers right just to not to manage the business.

And we see value. So our results will be skewed to the latter half of 'twenty three.

So, I think just important to keep those two things in mind.

So.

It's important to keep those two things in mind.

And we will continue, you know, as I commented, to show the value of both stored gas and unfold environmental attributes as a just let to adjusted ebidaw again so people can see kind of what's pending.

And we will continue as I commented to show the value of both stored gas and unsold environmental attributes.

Adjusted debt to adjusted EBITDA against that people can see kind of what's pending right to be monetized.

Right to be monetized again, hopefully the latter half of it here. Yeah, I just want to follow up. This is Adam again, you know, it's really key for us to do that to be able to match current period expenses versus what the value of the of the gap that we're producing holding an inventory and credit that we're missing in holding an inventory. We do report current period expenses for all of that gas that is producing credits that are that are in inventory.

Hopefully in the latter half of the year, Yes, I just wanted to follow up to that and again, it's really key for us to do that to be able to match current period expenses versus what the value of the of the gap that we're producing holding inventory in credits that were missing and holding inventory. We do report current period expenses for all of that gas that is.

Producing credits that are that are in inventory.

So just to follow up on that.

So just to follow up on that, and when you said that results will be skewed to the back half of the year.

And when you said the results will be skewed to the back half of the year.

When you said that initially tickets mean that your cash flows would.

When you said that initially, I took it to mean that your cash flows.

would be skewed to the back half of the year but it sounds like you're saying that that actual ebita

It would be skewed to the back half of the year, but it sounds like youre, saying that that actual EBITDA.

would be skewed. Is that the right interpretation? So now again, we will be adding back the value in adjusted either dot, so we'll be reporting it in each quarter. So to your point though, cash will be skewed towards the latter half of the year. Yeah, and it will show up in lower revenues and lower net income. Right, exactly. So when you report your gap in operating income, it will be lower in the first half, the second half. And once we plan on monetizing the balance of rents and RNG, that's an inventory. But for an permanent, just an even dot base if it gets smoothed down. Correct.

Would be skewed.

Right interpretation no again, we will be adding back the value in adjusted EBITDA and we'll be reporting it in each quarter.

So to your point, though cash will be skewed towards the latter half of the year, yes. It will show up in lower revenues and lower net income.

Right exactly so when you when you report your GAAP and operating income it will be lower in the first half in the second half once we plan on.

Monetizing the balance of brands.

R&D.

Inventory, but from an adjusted EBITDA basis, it gets smoothed out correct.

And Matthew Paul just adds as well. Good morning Mike, to hear you on the call here. That with the Emerald Project coming online, been here, you'll see a substantial pickup in gas in revenues income and even on, I can add to you as well from now.

Matthew I'll.

I'll just add as well good morning, nice to hear you on all of your.

With the MRO project coming online mid year, Youll see a substantial pickup in.

Gas.

Revenues income and EBITDA in the second half of the year as well from that.

Okay, that's helpful. And then follow up is just on the renewable power portfolio. It looks like there was an asset where you're, I guess your contract wasn't renewed. Could you talk a little bit about that? And do you view that as the risk going forward? Thank you.

Okay. That's helpful and then.

Follow up is just on the renewable power portfolio. It looks like there was some asset where you are.

I guess youre contract wasn't renewed could you talk a little bit about that and do you view that.

At the risk going forward. Thank you.

So Matthew John again, I'll take that. I'll start this one off. Yeah, that was a project that we had long-term gas rights on it with immunospecality and the municipality of the gas rights ended pursuant to its term and the municipality decided that they wanted to.

So Matthew John again.

I'll take I'll start this one off.

Yes that was a project that we have long term gas price autos, where the municipality and the municipality the gas price.

Pursuant to its term.

<unk> decided that they wanted to.

Take those accounts growing stock remove the power project.

remove the power project and look at the future later in life. It didn't involve anything to do with our project other than the fact that they are, I guess, keeping their options open in terms of what their future might look. And I'd say when you look across the portfolio, I'm just looking at John here and we can follow up. I don't think we have any gas rates.

Look at the future later in life.

Didn't go.

Sure.

Anything to do with our project other than the fact that they.

Or I guess, keeping their options open in terms of what their future plans.

And I would say when you look across the portfolio I'm just looking at John here and we can follow up I don't think we have any.

The gas rates.

Spire.

Nope, nothing in the near future.

No nothing in the near future.

Very helpful. Thank you.

And I'll add to that, that when we do a renewable natural gas project and we build these...

And I'll add to that.

When we do our renewable natural gas projects and we build these.

We get gas prices that are generally 20 years or longer with regard to those projects. So, you know, that's kind of a legacy, renewable power feature. But we don't see it affecting other projects going forward in the near future. Yeah, I would really consider that one off. Yeah.

<unk>.

Gas price.

Generally 20 years or longer with regard to those projects. So.

Sure.

Yes.

A legacy <unk>.

Renewable power feature.

But we don't see the effect of the other projects going forward in the near future I wouldn't really consider that one one off.

Thank you.

One moment please.

Our next question comes from a lot of Martin Maloy of Johnson Rice, Shilanaville.

Next question comes from the line of Martin Malloy of Johnson Rice. Your line is open.

Good morning. I had a question on the cost side and relative to slide seven with the revenue for landfill gas, dollar per MNBQ. Could you maybe, and I realized with projects coming online, there's a lot of movement around the cost side, but you maybe talk about...

Good morning.

Question on the cost side relative to slide seven.

With the revenue from landfill gas dollar per MB Q could you, maybe and I realize with projects coming online. There's a lot of movement around the cost side, but can you maybe talk about.

where you expect to get to on the call sign in terms of dollar from MB2 in the past towards getting there.

We expect to get to on the cost side in terms of dollar premise btu and the path towards getting there.

Yeah, this is the atom here. I'd say in general, although there were some escalated utility costs in 2022 and some other general inflationary pressures, our cost for MNB2 is not changed materially.

Yes. This is Adam here.

I would say in general although there were some escalated.

Utility costs in 2022, and some other general inflationary pressures or cost per MPT has not changed materially.

from what we've talked about previously. We're still in the high single digits for our cost of production on landfill and call it somewhere in the low 20s on dairy. And we are always trying to drive efficiencies in our business and trying to maximize output and productivity of our plant.

From what we've talked about previously.

Well in the high single digits for our cost of production on landfill and call it somewhere in the low twenties on dairy.

And.

We are always trying to drive efficiencies in our business and.

Try to maximize output.

And productivity of our plants.

So I'm not going to give you a specific target on where we think we can get crossed down to, but we don't see a lot of material changes from where we've been and what we've discussed historically. Thank you.

So im not going to give you a specific target on on where we think we can get cost down too.

But.

We don't we don't see a lot of material changes from where we've been and what we've discussed historically.

Thank you I'll turn it back.

Thank you one moment please.

Our next question comes from the line of William Griffin of UBS. Your line is open.

Our next question comes from the line of William Gripping of UBS, and Linus.

Great, thanks. Good to speak with you all, and thanks for taking the questions. I appreciate all the color that you've already provided. It just have a couple of maybe more modeling questions here. But first, could you provide any color on the SGNA that you have embedded in the Adjusted E-Bit of Guide for 2023?

Great. Thanks, good to speak with you all and thanks for taking the questions.

I appreciate all the color that you've already provided I just have a couple of maybe more modeling questions here, but first could you provide any any color on the SG&A that you have embedded in your adjusted EBITDA Guide for 2023.

This is Ann, so I don't think that we want to get to the level of detail and actually guiding there. As you can imagine, first year public company, I think we've tried to model out something that is appropriate and reasonable, but I don't think we want to get to that level of detail in our

And so I don't think that we want to get to the level of detail and actually signing.

Is there as you can imagine.

First year public company I think we've tried to model out something thats.

Appropriate and reasonable, but I don't think we want to get to that level of detail mris.

Fair enough alright, so just pivoting to.

Fair enough. All right, so I've just pivoting to the E-Rin pathway. Just what are the key developments that you need there to or expect to come there to gain clarity on how impactful that could be for Opal?

The <unk> pathway, just what are the key developments that you need there to or expect.

To come there to gain clarity on how impactful that could be for Opel.

Yeah, so this is Adam here. I say from a super high level, we have to see whether or not it's included in the final rule as a pathway. You know, right now they propose that you could use renewable power to be used at the electricity as a transportation fuel. So first order of business, are they gonna include that as a pathway here in June ?

Yes. So this is this is Adam here I think from a super high level, we have to see whether or not it's included in the final rule and the pathway.

Right now they propose that you could use renewable power to be used as electricity transportation fuel. So first order of business are they going to include that as a pathway here in June .

Second order is and they may delight it quite frankly. I think there's a lot of push and a lot of momentum behind including it, but the industry have a lot of questions around some of the mechanics that we need some clarity around, which is the equivalency value, how many rims are they going to side, a sign per megawatt that you that you produce. There's a little bit of mechanics around.

Order of business and they may delay it quite frankly, I think there's a lot of push in a lot of momentum behind including it but industry have a lot of questions around some of the mechanics that we need some clarity around which is what is the equivalency value. How many brands are they going aside assigned per megawatt that you.

That you produce there is a little bit of mechanics around.

Who the main generator will be I don't think that necessarily impacts the economics, so much but people have a lot of questions over whether or not the auto OEM will be the the generator of that RIN credits, and then who needs to be assigned on the pathway, which is that entire value chain and he ran for how the economics are going to.

that necessarily impacts the economics so much, but people have a lot of questions over whether or not the auto OEM will be the degenerator of that rent credit. And then who needs to be assigned on the pathway, which is that entire value chain of the E-Rin for how the economics are gonna get split up? So we think it's all potentially really positive and there's also the potential to take your RNG from a pipeline and potentially create some of the risks. So there's a lot of little nuances in it, but those are just to give you a flavor of some of the high level of what we've been some prism clarity on.

Split up so.

We think it's all a potentially really positive and there is also the potential to take your R&D from our pipeline and potentially create some EBIT. So there's a lot of little nuances in it.

And but those are just to give you a flavor some of the high level of what we.

Some clarity on.

All right, appreciate it, that's all for me. Thank you. Thank you, one moment, please. Our next question comes from a lot of.

Alright I appreciate it that's all for me.

Yes.

Thank you one moment please.

Our next question comes from the line of Ryan Zink.

B Riley your line is open.

Hey, good morning, guys.

Maybe I'll just sneak one in here, going back to your comments around.

Maybe I'll just sneak one in here going back to your comments around the multiyear RVO, allowing for the potential of longer term contracts or are those discussions happening today and what would be your expected time frame for entering into contracts like that yes. They are happening internally they are happening with other marks.

the multi-year RVO allowing for the potential of longer term contractor are those discussions happening today.

What would be your expected timeframe for entering into contracts like that? Yeah, they're happening internally. They're happening with other market participants. I wouldn't say they've begun in real earnest, yet with obligated parties. You know, we would anticipate those kinds of things to potentially start happening once the volumes are set. So that's something that we can report back on in the back app in here. Gotcha. Thanks.

Participants I wouldn't say they've begun in real earnest yet with obligated parties.

We would anticipate those kinds of things to potentially start happening once the volumes are set.

So that's something that we can report back on in the in the back half of the year.

Gotcha, Thanks, I'll turn it back.

Okay.

Thank you one moment please.

Our next question comes from the line of Craigs Reav Tour of Brothers, your line of open.

Our next question comes from the line of Craig Sorry of Tuohy Brothers. Your line is open.

Hi, Thanks for taking the questions.

Hi, thanks for taking the questions. So first, maybe you can help me understand, if there's a biogasca power project that has a long term PPA offtake.

So first maybe you can help me understand if theres a biogas to power projects that have a long term PPA off take.

How does the ERINs work in that case? What's it is two to five years left on the PPA? Does the off-paker own that or how's all that work?

How does that <unk> work in that case, let's say, there's three to five years left on that PPA.

Uptake around that or how does all that work.

Thank you for your question. This is John . So it varies. Some project.

Thanks for your question this is John so.

If dairies.

Some projects.

find the carbon value either through reps or otherwise to the power purchaser and some do not. And you know, cases where it has been assigned and the project is potentially, you know, a material participant in this market. We've come in discussions with counter parties to substitute.

Sure.

The carbon value either through rest or otherwise to the power purchaser.

Some dude.

Okay.

Thank you Ware.

It has been assigned.

And the project is potentially a material participated in this market we have commenced discussions with counterparties to subsea.

Substitute.

Okay.

Sure.

So, the party has fired RINs for the renewable attributes from our gaps that will enable us to then sell the E-RIN. So, it's kind of a mixed bag out there, but I would say that we see a pathway to getting some majority of our renewable power into the E-RIN pathway.

Third party acquired brands for the renewable attributes from our doubts that will enable us to them. So the written so so so it's kind of a mixed bag out there, but I would say.

We see a pathway to getting the majority of our renewable power into the hearings.

Great.

<unk>.

And then you talk a couple of times on this call about, you know, the

And then you talked a couple times on this call about.

No.

Pick up a reassessment of landfill operators last year that seems to be thawing allowing projects to move forward or at least counteracting.

Pick up a reassessment of landfill.

Operators last year, those things to be thawing, allowing projects to move forward or at least contracting.

<unk>.

If they were reassessing the underlying value of RNG in their footprint, does that mean for new contracts and projects that perhaps higher splits have to be afforded to be...

If they were reassessing.

The underlying value of our LNG and their footprint.

Does that mean for new contracts and projects that perhaps higher splits to be afforded to be.

Site hosts.

I think all that took place over the course of the last year or two and that people settled out as to what the right splits ought to be. I think that the value has shifted somewhat as some of that has been recognized. But most of that has taken place.

I think all of that took place over the course of the last year or two.

People settled out as to what the right.

Splits all of the things Thats the value has shifted somewhat as some of that has been recognized but most of that has taken place.

And, you know, we'll still see some dynamics out there. But I think that that that pathway is open for getting more contracts.

We'll still see some dynamics out there, but I think.

So.

Pathway is open.

Or are getting more contracts.

vitalize and sign and putting those projects.

And so by putting those projects into construction.

into construction in the near future. Yeah, and this is that. I'll just a couple of quick follow up there. One is, I don't, you know, we haven't seen any real changes.

Near future. Yes. This is Andy I'll, just add just a couple of quick follow ups. There one is.

We haven't seen any real changes in royalty rates.

in royalty rates that change, sort of how ill multiple floors and that sort of thing. So that's...

That changed sort of.

How build multiples look for us and that sort of thing so that's positive.

That's positive. And just to John's point there, we really do feel like we've gotten some good visibility interaction and getting these things across the finish line. And so it was a little surprising for how long documentation can take. A lot of these things, like we feel really good about where we're at today versus maybe six months ago in terms of moving those things through documentation.

And just to John's point there.

We really do feel like we've gotten some some good visibility and traction and getting these things across the finish line and.

So it was a little surprising for how long documentation can take on a lot of these things.

But.

We feel really good about where we're at today versus maybe six months ago in terms of moving those things through.

Documentation.

Thanks, and really quick modeling question.

Thanks, and really quick modeling question. If you're banking rents to sell potentially higher prices after the firm RVO in the second half.

Banking rooms to sell potentially higher prices the firm RVO in the second half.

How do you assess the pricing at which you report that in your justice to be the thus?

How would you assess the pricing at which you report in your adjusted EBITDA.

So I think we shared with you kind of what our assumptions were in terms of guidance. And as we get through each quarter, we come to Q1, we'll probably, we'll make an assumption around kind of what that president looks like for the value at that time and provide an updated sensitivity in terms of, you know, what market prices are.

So I think we shared with you what our assumptions were in terms of guidance.

And as we get through each quarter.

When we come to Q1, we will probably we will make an assumption around kind of what that pricing looks like for the value at that time and provide an updated sensitivity in terms of where market rate environment.

Okay. Thank you.

Thank you.

Please.

Our next question comes from the line of Derrick Whitfield of Stifel. Your line is open.

Our next question comes from a lot of Derek Whitfield. A few of you are lying as open.

Yes.

Again, wanted to ask a follow-up on the last question and ask you really to elaborate on the competitive landscape more broadly. As you're aware and have noted, we've observed unprecedented levels of M&A for R&G assets over the last.

Again I wanted to ask a follow up on the last question and ask you really to elaborate on the competitive landscape more broadly.

Youre aware and have noted we've observed unprecedented levels of M&A for R&D assets over the last year.

with an increased focus more recently in the downstream side, based on the BP travel centers potential act.

With an increased focus more recently in the downstream side based on the BP travel centers potential acquisition in your view what are these transactions imply about the value of your business and how do they altered the competitive and operating environment for you.

In your view, what are these transactions that imply about the value of your business and how do they alter the competitive?

seemingly there are less agile guys at the table right now.

Seemingly there are less agile guys at the table right now.

Versus past periods.

Yes. So this is Adam here.

Yeah, so this is that. I actually thought that was a pretty interesting acquisition that BP made there. And I think the read through is something that we've talked about in the past about being vertically integrated and where price and power could be for alternative.

It does have some pretty interesting acquisition that that BP made there.

I think the read through is something that we've talked about in the past about being vertically integrated and where pricing power could be for alternative.

fuels into the, you know, sort of, class-based industry. And, you know, from my perspective, and we've seen a couple of these other smaller private downstream players as well get acquired.

Fuels into into the into the.

Sort of class eight industry and.

From my perspective, and we've seen a couple of these other smaller private.

Downstream players as well and get acquired.

by other major EMTs. We give it a little bit of a validation of sort of what we put together and grow in organically. And

By other major E&ps, we give us a little bit of a validation of.

Yes.

What we've put together and grown organically and.

You know, I think there's some interesting opportunities as a vertically integrated player. And we'll see how that plays out. Historically, deployment in this industry has really been a sort of a up-ahine defense kind of model and dedicated fueling. We think that 15-liter engine is gonna open up.

I think I think there are some interesting opportunities as a vertically integrated player and.

We'll see we'll see how that plays out historically.

Deployment in this industry has really been a problem.

Sort of a behind the fence kind of model and dedicated fueling we think Thats 15 liter engine, it's going to open up.

some new opportunities with some trucking and logistics leads.

Some new opportunities with some trucking and logistics suites.

and maybe there could be ways to look at how future deployments could be. So, you know, and we have seen, you know, obviously a lot of M&A activity on just the upstreet production side as well. So, you know, we feel like it's an interesting read through for what we put together during all the schedules. And if I can just say, Derek, that...

And maybe there could be ways too.

<unk>.

Looking at our future deployments could be so.

We have seen obviously a lot of M&A activity and just the upstream production side as well.

So.

We feel like it's.

An interesting read through for what we've put together here at <unk>.

I can just say it's Eric.

<unk>.

In general, the pendulum continues to move towards decarbonization and the value of renewable fuels continues to be central to those strategic players and now to financial players as well. And so, you know, we continue to see a lot of interest as I was.

In general.

Pendulum continues to move towards the carbonization and the value.

Renewable fuels continues to be central to those strategic planners and now to.

Financial players as well and so we continue to see a lot of interest as I was saying earlier I feel like.

saying earlier, I feel like the country in the world is kind of leaning into this sector. And you continue to see it quarter after quarter as companies are making moves towards that decarbonization, how they're gonna play in that in the future. It's a tough decision for a lot of people to make and then to find the right opportunities.

The country and the world is kind of leading into this sector.

And you continue to see.

After quarter.

Companies are making moves towards the <unk>.

C carbonization, how theyre going to play in that in the future. It's a tough it's a tough decision for a lot of people will make and then to find the right opportunities.

of companies that are growing in that social space.

Companies that are growing and special to the space.

We really provide that opportunity.

Really to provide that.

Opportunity.

Thanks, Adam and John for your comments.

Thanks Curtis.

Thank you. I'm sure no further questions this time. Let's turn the call back over to Adam Kamor for any closing remarks.

Thank you I'm showing no further questions at this time I will turn the call back over to Adam Kumar for any closing remarks.

Thank you very much for your participation in Opal Fuel in the year 2022, or in SCO. We look forward to continuing engagement and dialogue. Have a great day.

Thank you very much for your participation in <unk> full year 2022 earnings call. We look forward to continued engagement and dialogue have a great day.

Thank you. Ladies and gentlemen, this does include today's conference. Thank you all participating. You may now disconnect. Have a great day.

Thank you ladies and gentlemen, this does conclude today's conference. Thank you all participating you may now disconnect have a great day.