Q1 2024 OPAL Fuels Inc Earnings Call

Okay.

Operator: Good morning, and welcome to the Opal Fuels First Quarter 2024 Earnings Call-In Webcast. At this time, all participants are in a listen-only mode.

Speaker Change: Good morning, and welcome to the Opel fuels first quarter 2024 earnings call and webcast. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone you will then hear message all had made.

Operator: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star-one-one on your telephone. You will then hear an automated message advising that your hand is raised.

Speaker Change: Message surprisingly in your hand is raised to withdraw your question. Please press star one again as a reminder, this event is being recorded I would now like to turn the call over to Todd Firestone Vice President of Investor Relations. Please go ahead.

Operator: To withdraw your question, please press star 11 again. As a reminder, this event is being recorded. I would now like to turn the call over to Todd Firestone, Vice President of Investor Relations. Please go ahead.

Todd Firestone: Thank you, and good morning, everyone. Welcome to the Opal Fuels first quarter 2024 earnings conference call. With me today are co-CEOs Adam Comora and Jonathan Maurer, and Scott Contino, Opal's interim chief financial officer. Opal Fuels released financial and operating results for the first quarter of 2024 yesterday afternoon, and those results are available on the investor relations section of our website at opalfuels.com. The presentation and access to the webcast for this call are also available on our website. After the completion of today's call, a replay will be available for 90 days.

Todd Firestone: Thank you and good morning, everyone and welcome to the Fuel's first quarter of 2024 earnings Conference call with me today are co CEO, Brian Moore, and Scott Casino <unk> interim Chief Financial Officer.

Todd Firestone: Although fuels released financial and operating results for the first quarter of 2024 yesterday afternoon, and those results are available on the Investor Relations section of our website at <unk> Dot com.

Todd Firestone: The presentation and access to the webcast for this call are also available on our website.

Todd Firestone: After completion of today's call a replay will be available for 90 days.

Todd Firestone: Before we begin, I'd like to remind everyone that our remarks, including answers to your questions, are forward-looking. Forward-looking statements are not a guarantee of performance, and actual results could differ significantly from what is contained in such statements. Factors That Could Cause or Contribute

Speaker Change: Before we begin I'd like to remind everyone that our remarks, including answers to your questions contain forward looking statements, which involve risks uncertainties and assumptions.

Speaker Change: Forward looking statements are not a guarantee of performance and accuracy of alts could differ materially from what is contained in such statements.

Speaker Change: Factors that could cause or contribute.

Adam J. Comora: These such differences are described on slides two and three of our presentation. These forward-looking statements reflect our views as of the date of this call, and Opal Fuels 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 discussion of certain non-GAAP measures; a definition of non-GAAP measures used in the reconciliation of these measures to the nearest GAAP measure is included in the appendix of the release and presentation.

Speaker Change: Such differences are described on slide two or three of our presentation. These forward looking statements reflect our views as of the date of this call and Opal fuels does not undertake any obligation to update forward looking statements to reflect events or circumstances. After the date of this call.

Speaker Change: Additionally, this call will contain discussion of certain non-GAAP measures a definition of non-GAAP measures used in the reconciliation of these measures to the NIM.

Speaker Change: S. GAAP measures included in the appendix of the release and presentation.

Adam J. Comora: Adam will begin today's call by providing an overview of the course results, recent highlights, and an update. Co-CEO, Opal Fuels. Good morning, everyone, and thank you for participating in Opal Fuel's first quarter 2024 earnings call. 2024 is off to a solid start.

Speaker Change: Adam will begin today's call by providing an overview of the quarters results recent highlights and an update on our strategic and operational priorities. John will then give a commercial and business development update after which Scott will review financial results.

Adam: Then open the call for questions and now I'll turn the call over to out of Cora co CEO of <unk> fuels.

Adam J. Comora: Our first quarter results were in line with our expectations, and we remain on track to meet our full year guidelines. With strong RIN pricing, stable production from operating facilities, strong performance and growth from our fuel station service segment, and new facilities remaining on schedule, we expect to see a nice progression of production and earnings growth throughout the year. Adjusted EBITDA for the quarter was approximately $15 million, in line with last quarter's results when taking into consideration the approximately $16 million of held environmental credit inventory we sold in the final quarter of 2020.

Adam: Good morning, everyone and thank you for participating in <unk> first quarter 2024 earnings call 2024 is off to a solid start our first quarter results were in line with our expectations and we remain on track to meet our full year guidance with stronger and pricing stable production from operating facilities strong.

Adam: Performance in growth for more fuel station service segment and new facilities remaining on schedule, we expect to see a nice progress in our production and earnings growth throughout the year adjusted EBITDA for the quarter was approximately $15 million in line with last quarter's results when taking into consideration the approximately $16 million of environmental.

Adam: Credit inventory, we sold in the final quarter of 2023.

Adam J. Comora: Our vertical integration continues to position us well to take advantage of the supportive market fundamentals for D3 RIN in the RFS market, which benefits both our R&G fuel business segment and our fuel station services division as we place more R&G toward dispensing. We have locked in pricing for the majority of our forecast for 2024 RIN production, which provides us visibility and helps to de-risk 2024 in terms of full-year financial performance. Operatally, production Production of 0.8 million MMDTU from our operating facilities remains stable and growing on a same store basis with inlet design capacity utilization and utilization of inlet gas remaining between 80 to 90, consistent with our prior disclosures and above industry average.

Adam: Our vertical integration continues to position us well to take advantage of the supportive market fundamentals for <unk> will be RF, thats market, which benefits both our R&D fuel business segment, and our fuel station services Division as we place more R&D for our dispensing network, we've locked in pricing for the majority of our forecasts.

Adam: The 2020 for RIN production, which provides us visibility and helps to de risk 2024 in terms of full year financial performance.

Adam: Operationally production and efficiency measures were in line with our expectations production of <unk> 8 million Btu from our operating facilities remained stable and growing on a same store basis with inlet design capacity utilization and utilization of inlet gas remaining between 80% to 90%.

Adam: Consistent with our prior disclosures and above industry averages we.

Adam J. Comora: We are very excited to announce that our ninth R&G facility, Prince Williams, has recently commenced operation. John will provide more details later in the. We also continue to execute on our growth objectives and today are announcing that construction has begun on our 15th RNG project at Cottonwood Land. The project will have an initial design capacity of approximately 0.7 million MMVTU and is 100% owned by Opal Fuels.

Adam: We are very excited to announce that our ninth R&D facility Prince William has recently commenced operations John will provide more details later in the call. We also continue to execute on our growth objectives and today, we're announcing that construction has begun on our 15th R&D project with the Cottonwood landfill. The project will have an initial does.

Adam: <unk> capacity of approximately 0.7 million Btu and is 100% owned by <unk>.

Adam J. Comora: We expect the Cottonwood facility construction period to be in line with our recent project. We continue to make meaningful progress with our development projects and partners and feel confident that we will meet or exceed our $2 million annual MMBTU target for new R&G projects entering construction this year. As previously mentioned, our fuel station services segment continues to perform and grow in line with our expectations. As we mentioned during our last earnings call, we remain cautiously optimistic that the IRS will clarify the rules governing ITC eligibility for landfill gas for R&G products.

We expect the Cottonwood facility construction period to be in line with our recent projects.

Adam: We continue to make meaningful progress with our development projects and partners and feel confident that we will meet or exceed our $2 million.

Adam: Annual <unk> target for new R&D projects entering construction. This year as previously mentioned our fuel station services segment continues to perform and grow in line with our expectations.

Adam: As we mentioned during our last earnings call. We remain cautiously optimistic that the IRS will clarify the rules governing ITC eligibility for our landfill gas to R&D projects. Although we did not include any ITC proceeds in the guidance. We issued in March we are hopeful that our new R&D projects will benefit from ITC.

Adam J. Comora: Although we did not include any ITC proceeds in the guidance we issued in March, we are hopeful that our new R&G projects will benefit from the ITC as we believe it was intended. We often talk about industry talent, and we continue to believe there is a great opportunity to expand bipartisan support for our industry. It is important to remember what we do. We capture harmful methane emissions from decaying organic waste and convert them into productive and low carbon intensity energy products that drop fuels, which utilize existing pipelines and electricity.

Adam: As we believe was intended.

Adam: We often talk about industry tailwind and we continue to believe there is a great opportunity to expand bipartisan support for our industry. It is important to remember what we did recapture harmful methane emissions from Teekay, all organic waste and convert them into productive and low carbon intensity energy products that are.

Adam: <unk> fuels, which utilize existing pipeline and electricity grid.

Adam: There is growing interest in what should be done with waste in place methane molecules and we believe <unk> is well positioned to be a leader in their capture conversion and marketing with proven technology and a proven track record with that I'll turn it over to John John.

Adam J. Comora: There is growing interest in what should be done with waste-in-place methane molecules, and we believe Opal is well positioned to be a leader in their capture, conversion, and marketing with proven technologies and a proven track record. With that, I'll turn it over to John.

John: Thank you, Adam, and good morning, everyone. We are proud of our accomplishments this quarter and, as Adam mentioned, believe we are well positioned to see a nice progression of production and earnings growth over the course of this year in line with our guidance. There are two main reasons for this.

John: Thank you Adam and good morning, everyone.

John: We're proud of our accomplishments this quarter and as Adam mentioned believe we are well positioned to see a nice progression of production and earnings growth over the course of this year in line with our guidance.

John: There are two main reasons for this outlook.

John: First, we have clear visibility to R&G Production Growth from new projects coming online this year, and second, we expect continued growth from our operating projects with respect to new projects coming online in 2024. We are very excited to announce that our ninth R&G facility, Prince William, has recently commenced operation and is expected to contribute meaningfully as it ramps production as we move through this. Prince William, combined with Sapphire and Pulp, which are on schedule to begin operations in the third and fourth quarters respectively, provide the roadmap for us exiting 2024 with 8.8 million MMBTU of annual design capacity in operation, compared to 3.9 and 5.2 exiting 20 Significantly, the project has been producing pipeline quality gas, and we have submitted the documentation for registration of the Prince William project under the current RFS rules for the EPA.

John: First we have clear visibility.

John: Two R&D production growth from new projects coming online this year and second we expect.

John: Continued growth from our operating projects.

With respect to new projects coming online in 2024.

John: We are very excited to announce that our ninth RMG facility Prince William has recently commenced operations and is expected to contribute meaningfully as it ramps production as we move through this year.

John: Prince William combined with Sapphire in pulp.

John: Which are on schedule to begin operations in the third and fourth quarters, respectively.

John: Provide the roadmap for us exiting 2024 with eight $8 million MN Btu of annual design capacity in operation.

John: Compared to $3 nine and five point to exiting 2022 and 2023, respectively.

John: Significantly the project has been producing pipeline quality gas and we have submitted the documentation for registration of the principal aim project under the current RFS rules with the EPA.

John: With Prince William, we now have nine R&G projects in operation with an aggregate annual design capacity of 7.0 million MMBTU, tripling since year-end 2021. Then, with respect to increasing output from operating projects, Looking at the first quarter results, R&G production increased to 0.8 million mmBtu from 0.6 million mmBtu in the first quarter of 2021. The increase is largely due to the Emerald R&G Project's contribution to production volume, and was also complemented by same store sales growth from our other operating projects.

John: With Prince William we now have nine R&D projects in operation with an aggregate annual design capacity of $7 million Mmm Btu tripling since year end 2021.

John: Then with respect to increasing output from operating projects.

John: Looking at the first quarter results RMG production increased to $1 8 million Mmm Btu promote 6 million Btu in the first quarter of 2023 the.

John: The increase was largely due to the Emerald R&D projects contribution to production volumes.

John: And was also complemented by same store sales growth from our other operating projects.

John: These are trends that we expect to continue throughout 2020. In addition to our operating projects, we currently have six R&D projects in construction representing an additional 3.3 million MMBTU of annual design. Combined, our portfolio of projects in construction and in operations now has a total of 10.3 million MMBTU of annual design. Sapphire, which is one of our 50-50 joint venture projects with GFL, is on track to begin operations in the third quarter of this. Our share of annual design capacity at Sapphire is 0.8 million metric tons.

John: These are trends that we expect to continue throughout 2024.

John: In addition to our operating projects. We currently have six R&D projects in construction, representing an additional $3 3 million Mmm Btu of annual designed capacity.

John: Bind our portfolio of projects in construction and in operations now as a total of $10 3 million Btu annual design capacity.

John: Sapphire, which is one of our 50 50 joint venture projects with GSL is on track to begin operations in the third quarter of this year.

John: Our share of annual design capacity at Sapphire is <unk> 8 million Btu.

John: Our Polk County, Florida project, where we own 100%, remains on track to begin operations in the fourth quarter of this year. Holt County represents 1.1 million MMBTU of annual design capacity. Atlantic, our first R&G joint venture with South Jersey Industries, which we put into construction in the third quarter of 2023, is progressing, and we continue to expect it to begin commercial operations in mid-2025. Opal's share of annual design capacity at Atlantic is 0.3 million MMVP.

John: Our pulp County, Florida project, where we own 100% remains on track to begin operations in the fourth quarter of this year.

John: Polk County represents $1 1 million Btu of annual design capacity.

John: Atlantic Our first R&D joint venture with South Jersey industries, which we put into construction in the third quarter of 2023 <unk>.

John: Is progressing and we continue to expect it to begin commercial operations in mid 2025.

<unk> share of annual design capacity at Atlantic.

John: <unk> 3 million Btu.

Scott Contino: As Adam mentioned, we feel confident that we will meet or exceed our 2.0 million annual MMBTU target for new R&G projects entering construction this year. I also want to add a word on development and our pipeline of opportunities. We remain encouraged by our deepening industry relationships and partnerships, and continue to see a robust opportunity set of attractive landfill R&G development projects. We also continue to explore opportunities to capture and convert biogas from other feedstocks, as a natural extension of our core business. With that, I'll turn it over to Scott to discuss the quarter's financial performance. Scott.

John: As Adam mentioned, we feel confident that we will meet or exceed our $2.1 million annual <unk> target for new R&D projects entering construction this year.

John: I also want to add a word on development in our pipeline of opportunities.

John: We remain encouraged by our deepening industry relationships and partnerships and continue to see a robust opportunity set of attractive landfill R&D development projects.

John: We also continue to explore opportunities to capture and convert biogas from other feedstocks.

John: As a natural extension of our core business.

John: With that I'll turn it over to Scott to discuss the quarter's financial performance Scott.

Scott Contino: 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 results for the quarter ending March 31st, 2024. Our 10-Q will be filed later today. Revenue in the first quarter was $65 million, as compared to $43 million in the first quarter of 2023. The main driver for the increase in revenues was the timing and pricing of environmental credit sales, including both R&G fuel and fuel station services where we dispense all of the R&G for our customers, as well as for our joint venture projects and other third-party R&D. Net income for the first quarter was approximately $0.7 million.

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

Scott Contino: As compared to a $7.3 million net loss in the first quarter of 2023, the difference was primarily driven by the increase in revenues from the timing of environmental credit sales, but also recognition of the Emerald R&G project coming online, accounted for in the equity method. Adjusted EBITDA was $15.2 million in the first quarter, compared to a negative $1.6 million in the first quarter of 2023, which, as mentioned, was driven by the timing of management's decision to hold back RIN sales in the first half of 2023 and production from the Emerald R&G project during Q1 2024.

Scott: Last night, we filed our earnings press release, which details our quarterly results for the quarter ending March 31, 2020 for our 10-Q will be filed later today.

Scott: Revenue in the first quarter was $65 million as compared to $43 million in the first quarter of 2023.

Scott: The main driver for the increase in revenues was the timing and pricing of environmental credit sales, including both RMG fuel and fuel station services, where we dispense all of the RMG for our projects.

Scott: As well as for our joint venture projects and other third party LNG supplies.

Scott: Net income for the first quarter was approximately zero point $7 million as compared to $7 3 million net loss in the first quarter of 2023. The difference was primarily driven by the increase in revenues from the timing of environmental credit sales, but also recognition of the Emerald <unk>.

Scott: LNG projects coming online and accounted for in equity method investments.

Scott: Adjusted EBITDA was $15 2 million in the first quarter compared to a negative $1 $6 million in the first quarter of 2023, which as mentioned was driven by the timing of management's decision to hold back RIN sales in the first half of 2023 and.

Scott: <unk> from the Emerald RMG project during Q1 2024.

Scott Contino: A reconciliation to gap results is provided in our earnings release from yesterday and in our investor presentation updated this morning on our. The RNG fuel segment revenues were $17.7 million for the first quarter, as compared to $6.7 million in the first quarter of 2023. The increase in revenues was primarily due to higher RIN sales and production growth. Fuel Station Services segment revenues were $37.1 million for the first quarter as compared to $20.8 million in the first quarter of 2023.

Scott: A reconciliation to GAAP results is provided in our earnings release from yesterday and in our Investor presentation updated this morning on our website.

Scott: The RMG fuel segment revenues were $17 7 million for the first quarter as compared to $6 7 million in the first quarter of 2023 the increase.

<unk> revenues was primarily due to higher RIN sales and production growth.

Scott: The fuel station services segment revenues were $37 1 million for the first quarter as compared to $20 8 million in the first quarter of 2023.

Scott Contino: The increase in revenues demonstrates the power of our vertically integrated business model and was primarily the result of higher utilization of our dispensing capacity, new Opal-owned fueling stations coming online, and Third Party Construction Revenue. Renewable power revenues were $10.1 million for the quarter compared to $15.4 million in the first quarter of 2023.

Scott: The increase in revenues demonstrates the power of our vertically integrated business model and it was primarily the result of higher utilization of our dispensing capacity, new Opal owned fuelling stations coming online and third party construction revenues.

Scott: Renewable power revenues were $10 1 million for the quarter compared to $15 4 million in the first quarter of 2023.

Scott Contino: This decrease is primarily due to Emerald R&G, which is using gas that was previously available for a renewable power facility. In the first quarter, capital expenditures were approximately $37.7 million, which includes approximately $10.9 million relating to equity method investments and approximately $3.8 million associated with downstream stations. We continue to expect our capital expenditures to be in line with our 2024 full-year guidance. Our senior secured credit facility provides up to $450 million of term loans over an 18 month draw period and $50 million of revolving credit.

Scott: This decrease is primarily due to Emerald RG, which is using gas that was previously available free for a renewable power facility.

Scott: In the first quarter capital expenditures were approximately $37 $7 million, which includes approximately $10 $9 million relating to equity method investments and approximately $3 $8 million associated with downstream stations.

Scott: We continue to expect our capital expenditures to be in line with our 2020 for full year guidance.

Scott: Our senior secured credit facility provides up to $450 million of term loans over an 18 month draw period and $50 million of revolving credit.

Scott Contino: As of March 31, 2024, approximately $187 million was drawn down on the facility, and we have utilized approximately $14 million of our revolver availability to issue letters of credit. As of March 31, 2024, our liquidity was approximately $334 million, consisting of $300 million of availability under the credit facility and $34 million of cash, cash equivalents, and short-term investments.

Scott: As of March 31, 2020 for approximately $187 million was drawn down on the facility and we have utilized approximately $14 million of our revolver availability to issue letters of credit.

Scott: As of March 31, 2020 for liquidity was approximately $334 million consisting of $300 million of availability under the credit facility.

Scott: And $34 million of cash cash equivalents and short term investments.

John: As a result, we feel our liquidity and capital resources and access to other sources of capital are sufficient for our growth plan. With that, I'll turn it back to John for his concluding remarks. In closing, we are pleased with the continuing success in the execution of our business, and we expect to see a nice progression of production and earnings growth throughout the year. As noted previously, we continue to be cautiously optimistic about clarification of ITC rules for our landfill gas to R&D. We remain committed to furthering Opal's vertically integrated mission.

Scott: As a result, we feel our liquidity and capital resources and access to other sources of capital are sufficient for our growth plans.

Scott: With that I'll turn it back to John for concluding remarks.

John: In closing we are pleased with the continuing success in the execution of our business plan and we expect to see a nice progression of production and earnings growth throughout the year.

John: As noted previously we continue to be cautiously optimistic about clarification of ITC rules for our landfill gas to R&D projects.

John: We remain committed to furthering <unk> vertically integrated mission.

Operator: Build and Operate Best-in-Class Biogas Capture and Conversion Projects that deliver industry-leading, reliable, and cost-effective low-carbon-intensity energy products that displace fossil fuels and mitigate climate change. With that, I'll turn the call over to the operator for Q&A. Thank you all for your interest in Opal. As a reminder, to ask a question, please press star 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again.

John: To build and operate best in class biogas capture and conversion projects that deliver industry, leading reliable and cost effective low carbon intensity energy products that displace fossil fuels and mitigate climate change.

Speaker Change: With that I will turn the call over to the operator for Q&A.

Speaker Change: Thank you all for your interest in Opal fuels.

Speaker Change: Certainly as a reminder to ask a question. Please press star one on your telephone and thanks for your name to be announced.

Speaker Change: Withdraw your question. Please press star one again, please standby, while we assemble the Q&A roster.

Operator: Please stand by while we assemble the Q&A roster, one moment for our first question. Our first question will be coming from Derrick Whitfield of Stiefel. Your line is open. Good morning all and thanks for your question. Morning, Derrick. I would like to start with your adjusted EBITDA guidance for the year. Is it safe to assume you remain comfortable with the 2024 guidance based on your line of sight to production growth and your decision to sell forward RENs, which, in combination, derisks the revenue line? Derrick, thanks very much for your question.

Speaker Change: One moment for your first question.

Speaker Change: Our first question will be coming from Derrick Whitfield of Stifel. Your line is open.

Derrick Lee Whitfield: Good morning, all and thanks for your time.

Derrick Lee Whitfield: Good morning Derik.

Derrick Lee Whitfield: Like to start with your adjusted EBITDA guidance for the year is it safe to assume you remain comfortable with the 2024 guidance based on your line of sight to production growth and your decision to sell forward rents, which in combination de risked the revenue line item.

Operator: Yes, Opal Fuels continues on track to meet its guidance. We forecast a progression of increasing output and EBITDA as Prince William ramps up. Prince William is really gonna be kind of a major contributor during the course of the year, while Pulk and Sapphire will come on in the fourth and third quarters respectively, contributing towards the end of the year. It's really the ramp-up of Prince William.

Derrick Lee Whitfield: Derek Thanks, very much for your question, Yes, Opel fuels continues on track to meet its guidance.

Derrick Lee Whitfield: Forecast progression of increasing output and EBITDA.

Derrick Lee Whitfield: Principally I'm ramps up.

Derrick Lee Whitfield: William is really going to be kind of a major contributor during the course of the year while pulp.

And Sapphire will come on in the fourth and third quarters, respectively.

Contributing towards the end of the year, it's really the ramp up of Prince William as we said we.

Derrick Lee Whitfield: As we said, we put our paperwork in with the EPA for the project to produce RIN. And we expect that we'll be dispensing from that project at the end of the second quarter, and it'll really start contributing starting in the third quarter and through the fourth quarter. So that's really the progression that we see here. As you alluded to, and we said before, we've sold a majority of the RINs that we expect to produce this coming year.

Derrick Lee Whitfield: Put our paperwork in to the EPA for the project to produce rents.

Derrick Lee Whitfield: And we expect that will be dispensing from that project at the end of the second quarter and it will really be contributing starting in the third quarter and through the fourth quarter. So that's really the progression that we see here.

Derrick Lee Whitfield: <unk>.

Speaker Change: Okay as you alluded and we said before we've sold a majority of the Rins that we expect to produce this coming year.

Speaker Change: We believe that that significantly de risks.

Derrick Lee Whitfield: And we believe that that significantly de-risked our EBITDA and cash flows for the year. And, you know, as I alluded, our construction projects will start to contribute towards the end of the year. And so we'll see a little more bump right at the end of the year.

Speaker Change: Our EBITDA and cash flows for the year.

Speaker Change: <unk>.

Speaker Change: As I alluded, our construction projects will start to contribute towards the end of the year and so.

Speaker Change: We will see a little more bump right at the end of the year. So we feel really good about where we are on track for.

Speaker Change: Our EBITDA.

Adam J. Comora: So we feel really good about where we are on track for our EBITDA. Our R&G production, our projects into construction, we announced, obviously, the Cottonwood project, and we think that we'll have a progression of announcements over the next several months that will continue that positive progression as we move towards that guidance. [inaudible] will also hit our guidance that we're looking for. CapEx obviously is related to our projects in construction. The projects in construction continue on time and on budget, and while billings may be a little bit slower at the front end of a project, they accelerate as you get closer to. So, the long answer to your question; the short answer is: And that's great. And just to clarify one point on the self-worth of your rent exposure.

Speaker Change: Sure.

Speaker Change: <unk> production.

Speaker Change: Projects into construction.

Speaker Change: We announced obviously the Cottonwood project and we think that will have a progression of announcements over the next several months that will continue.

Speaker Change: Positive progression as we move towards that guidance.

Speaker Change: <unk>.

Speaker Change: Our capex.

Speaker Change: We will.

Speaker Change: Also in our guidance that we're looking for Capex, obviously is related to our projects and construction projects in construction continue on time and on budget.

Speaker Change: While billings may be a little bit slower at the front end of a project accelerate as you get towards the completion so.

Speaker Change: Long answer.

Speaker Change: To your question the short answer is yes.

Speaker Change: That's great and just to clarify one point on the sell forward.

Of your rent exposure are you guys doing that out of an abundance of caution are you concerned that the EPA could affect the CWC to address the likely shortfall in rent generation right.

Adam J. Comora: Are you guys doing that out of an abundance of caution? Are you concerned that the EPA could affect the CWC to address the likely shortfall in rent generation? Yeah, hey, Derrick. Adam Comora here.

Speaker Change: Yeah, Hey, good morning, Derrick Adam Tomorrow here.

Adam J. Comora: No, I don't I don't think we're going to see a cellulosic waiver credit in 2024. And, you know, we think that this is, we just feel like it is a way for us to de-risk and get better visibility over our EBITDA and cash flows for the year. You know, I want to be a little careful because we are active in the market with our price forecast and that sort of thing. But, you know, we have sold forward a majority of our production, which makes complete sense. And John, for my follow up, perhaps.

Speaker Change: No I don't think were going to see a cellulosic waiver credit.

Speaker Change: In <unk> in 2024.

Speaker Change: And.

Speaker Change: We think that this.

Speaker Change: We just feel like it is.

Speaker Change: Way for us to Derisk and get better visibility over our EBITDA and cash flows for the year.

Speaker Change: I want to be a little careful because we are active in the market.

Speaker Change: Our price forecast and that sort of thing, but we.

We have.

Speaker Change: So forward a majority of our production.

Speaker Change: Makes complete sense and John for my my follow up perhaps for you with respect to your pipeline of projects. I know you guys have moved away from disclosing the ADP.

John: With respect to your pipeline of projects, I know you guys have moved away from disclosing 80, but maybe could you offer some color on the depth of opportunities you're seeing in the market today, similar to the Cottonwood project you guys just, Yeah, sure. We see really great relationships and partnerships with all of our landfill partners, and they're continuing to deepen. I think that, um, you know, particularly a good example is our growing relationship with GFL at our Emerald and Sapphire projects. We consider relationships to be one of our highest values.

John: But maybe could you offer some color on the depth of opportunities youre seeing in the market today similar to the Cottonwood project you guys just announced.

John: Yes sure.

Speaker Change: We see really great.

John: Relationships and partnerships with.

John: All of our landfill partners and Theyre continuing to deepen I think.

John: Particularly.

John: Good example is our growing relationship with GFS.

John: At our Emerald and Sapphire projects, <unk>, particularly forward thinking and collaborative and we see growing relationship there, but there is a growing opportunity set across all of our relationships. We consider relationships. So we one of our highest values and it's really paying off by coming together with additional.

John: And it's really paying off by coming together with additional projects. In addition, our execution on our projects, where when we complete construction and bring a project online, that confidence that the project is going to work when we turn it on and ramp up over a reasonably projected timeframe really gives us great confidence in what we're putting together. So as more and more opportunities come through, we see continued progression in our development pipeline. Thanks.

John: <unk> projects in addition.

Our execution on our projects, where when we complete construction and bring a project online.

John: That confidence that the project is going to work when we turn it on and ramp up.

John: <unk>.

John: A reasonable projected timeframe really it gives us.

John: Great confidence in what we're putting together, so as more and more opportunities come through.

John: We see that continued progression in our development pipeline.

Matthew Robert Lovseth Blair: That's great, Taylor. One moment for our next question, and our next question will be coming from Matthew Blair of TPH. Your line is open. Thank you and good morning.

Speaker Change: Thanks, that's great color.

Speaker Change: And one moment for our next question.

Speaker Change: And our next question will be coming from Matthew Blair of Tpa <unk>. Your line is open.

Matthew Robert Lovseth Blair: Thank you and good morning.

John: You have some big projects coming online later this year with Sapphire and Polk. Could you talk about what you've learned from previous startups that you can apply to make sure these projects are successful and start up on time? Sure. Hi Matthew.

Matthew Robert Lovseth Blair: You have some big projects coming online later this year with Sapphire in Polk could you talk about what you've learned from previous startups.

Matthew Robert Lovseth Blair: Can apply to make sure. These projects are successful start up on time.

John: Thank you for your question. Now that we have our ninth project entering operations, we really take lessons from each project that we put into construction and then into operation, and it really contributes to each of the next ones. The basic design that we use is a proven design and one that we've utilized from our start with the Pine Bed and Noble Road project. I'm going to go straight through to the project that we're putting into construction today. While the size may differ, the basic design is the same.

Sure Hi, Matthew Thank you for your question.

Matthew Robert Lovseth Blair: No.

Speaker Change: Now that we have our ninth project entering operations, we really take lessons from each project that we put into construction and into operation and it really contributes to each of the next ones.

Speaker Change: Basic design that we use as a proven design and one that we've utilized from.

Speaker Change: Our start with the pie embedded in noble road projects straight.

Speaker Change: Straight through to the projects that we're putting into construction today, while the size may differ the basic design.

John: And so each time our team of Project Managers gets more experience, we take the lessons learned from each project and apply them to the next set of projects, which gives us greater and greater confidence in terms of those projects coming online and working as projected. We try to stay away from technologies that are not proven, and having this really solid design is something that. Again, I'm just repeating myself, giving us that confidence. Sounds good.

Speaker Change: Is the same and so each time.

Speaker Change: Team of.

Speaker Change: Project managers gets more experience, we take the lessons learned from each project and apply it to the next set of projects, which gives us greater and greater confidence in terms of those projects coming online and working.

Speaker Change: Projected.

Speaker Change: While.

We try to stay away from technologies that.

Speaker Change: Are not proven.

Speaker Change: And having this really solid design is something that.

Speaker Change: Again, I'm, just repeating myself it gives us that confidence Smith.

Matthew Robert Lovseth Blair: And then one thing that investors ask about is your build multiples on your upcoming projects. Are you willing to share the cost per project for some of these upcoming startups? I think at one point, you had listed Prince William at 53 million. Is that still a good number? And then are you willing to share the cost for Sapphire, Polk, and Cottonwood?

Speaker Change: Sounds good and then one thing that investors ask about as you build multiples on on your upcoming projects are you willing to share the costs for project for some of these upcoming startups I think at one point.

Speaker Change: You had listed principally in at $53 million is that still a good number and then are you willing to share the costs for Sapphire Polk in Cottonwood. Thank you.

Adam J. Comora: Yeah, this is Adam Comora here. We're not going to get into specific cap costs per project. What I would tell you is, obviously, over the last several years, there has been some cost inflation that we think, you know, is not unique to Opal Fuels. And, despite that cost inflation over the last couple of years, we're still finding very attractive returns on capital projects. And I can tell you we're extraordinarily capital disciplined here at Opal Fuels. It's in all of our DNA.

Speaker Change: Yes. This is Adam <unk> here, we're not going to get into specific cap cost per project, what I would tell you is.

Adam: Over the last several years there has been some cost inflation.

Adam: That we think.

Adam: It's not unique to Opel fuels and.

Adam: Yes.

Adam: Despite that cost inflation over the last couple of years.

Adam: We're still finding very attractive return on capital projects and.

Matthew Robert Lovseth Blair: And we still are finding attractive unlevered IRR return projects. You know, and what I would say is, bill multiples are lower for larger projects. And, you know, if you do move down the curve of smaller projects, the bill multiples do, you know, lengthen out a little bit. But we are still finding really attractive returns on capital projects. Great, thank you.

Adam: I can tell you we're extraordinarily capital.

Adam: Disciplined here at <unk> fuels, it's in all of our DNA.

Adam: And we still are finding attractive unlevered IRR.

Adam: Return projects.

Adam: And what I would say is build multiples are lower for larger projects.

Adam: <unk>.

If you do move down the curve of smaller projects.

Adam: The build multiples do.

Adam: Lengthened out a little bit.

Adam: But we are still finding really attractive return on our capital projects.

Adam: Yes.

Speaker Change: Great. Thank you.

Martin Whittier Malloy: One moment for our next question, and our next question will be coming from Martin Malloy of Johnson Rice and Company. Your line is open. Good morning.

Speaker Change: One moment for our next question.

Speaker Change: And our next question will be coming from Martin Malloy of Johnson Rice <unk> Company. Your line is open.

Speaker Change: Okay.

Adam J. Comora: Thank you for taking my question, Matt. I just wanted to add. Relative to slide 18, any update in terms of customer adoption or testing of the 15 liter? Yeah, this is Adam Comora here again. Thanks for the question, Matt. The testing has gone very well for fleets.

Martin Whittier Malloy: Good morning, Thank you for taking my question.

First question.

Martin Whittier Malloy: I just wanted to ask.

Martin Whittier Malloy: Relative to slide 18, any update in terms of customer adoption or testing of the 15 liter engine.

Adam J. Comora: And, you know, we think it's a really attractive product financially for these fleets, where they can see really attractive returns on capital to deploy them, even if they were just running on CNG, regardless of the sustainability advantages from running on RNG. So, you know, no change to our outlook there. You know, I know I'm going to be asked at some point about regulatory policy and that sort of thing, which, you know, we think this is a very attractive product for fleets to adopt.

Martin Whittier Malloy: Yes. This is Adam <unk> here again, thanks for the question Matt.

Martin Whittier Malloy: The testing has gone very well for fleets and.

Adam: We think it's a really attractive product financially for these fleets, where they can see really attractive returns on capital to deploy them. Even if they were just running on <unk>, regardless of the sustainability advantages from running on our LNG.

Adam: So.

Adam: No change to our outlook there.

Adam J. Comora: And, you know, I know another company, a lot of folks have already reported and spoken about what the ramp could be for for this product in the market. And we sort of see it the same way.

Adam: I know I'm going to be asked at some point on regulatory policy and that sort of thing.

Adam: Which.

Adam: We think this is a very attractive product on.

Adam: For fleets to adopt and.

I know a lot of folks have already reported and spoken about whats the ramp could be for.

Adam: For this product in the market and we sort of see it the same way.

<unk>.

Adam: We think there is a really large potential for it now in our guidance and our guidance for the year.

Adam J. Comora: And, you know, we think there's a really large potential for it. Now, in our guidance and in our guidance for the year, we've never baked in a fast adoption curve here at 24, because, you know, the trucks really won't start showing up until 25. But nothing has changed in terms of, you know, sort of the feedback we've gotten and, you know, the interest levels that we're seeing, especially given, you know, where some of the electrification or hydrogen fuel cell, you know, sort of challenges are still there for this for this class eight heavy-duty fleet. And, you know, I think it's starting to really prove out, and folks are starting to recognize that this is a really So, you know, I'll just leave it there.

Adam: Never baked in a fast adoption curve here in 'twenty four because the trucks really wont start showing up until 'twenty five but nothing has changed in terms of sort of the feedback we've gotten and.

Adam: The interest levels that we're seeing especially given.

Adam: Where some of the electrification our hydrogen fuel cell.

Adam: Sort of challenges are still there.

Adam: For this for this class eight heavy duty fleet and.

I think it's starting to really proved out and folks are starting to recognize that this.

Adam: He is a really good answer for heavy duty trucking and.

Adam: So.

Martin Whittier Malloy: It's sort of no change to what we were thinking last time we spoke about it. Okay, and then for my follow-up. I wanted to ask, as well, about slide 9...

Speaker Change: I'll just leave it there.

Speaker Change: No change to what we were thinking last time, we spoke about it.

Speaker Change: Okay and then for my follow up question just wanted to ask you is relative to slide 19, if you could talk maybe about the non transportation demand and if youre seeing any interest from data center operators in terms of using RMB as.

Adam J. Comora: If you could talk maybe about the non-transportation demand and if you're seeing any interest from data center operators in terms of using RNG as a fuel for power. Yeah, so this is Adam Comora again. I, you know, we are seeing increasing interest in the use of RNG in a variety of markets, whether it be SAF, whether it be hydrogen production, whether it be used for data centers. And look, I think everybody recognizes that there is, you know, more demand for RNG than, likely, supply. And a lot of these different markets are looking to it to decarbonize. And, you know, that sort of demand-supply imbalance naturally leads to prices going up in these in other sorts of markets.

Speaker Change: Is it fuel for power.

Speaker Change: Yes. So this is Adam <unk> again.

Speaker Change: We are seeing increasing interest for the use of R&D in a variety of markets, whether it be SaaS, whether it be hydrogen production.

Adam: Whether it be used for data centers and <unk>.

Look I think everybody recognizes that there is more.

Adam: Demand for RMG, then likely supply.

Adam: And a lot of these different markets and looking to it to decarbonize.

Adam: And.

Adam: That sort of demand supply imbalance naturally leads to.

Adam: Prices going up in these any other sorts of markets.

Ryan James Pfingst: Now, we are still of the belief that the highest best value is in transportation fuel; we haven't seen yet where it makes sense for us to sell into those other voluntary markets. And we understand, you know, sort of the trade-offs there between voluntary markets and the renewable fuel standard. And, but that being said, we think, you know, sort of, at some point, that this may change, and we may start to see those prices move up to those levels that make sense.

Adam: We are still of the belief that the highest value is in transportation fuel, we haven't seen yet where it makes sense for us to sell into those other voluntary markets and we understand.

Sort of the trade off there between voluntary markets and the renewable fuel standard.

Adam: <unk>.

But that being said we think.

Adam: Sort of.

Adam: At some point that that May change and we may start to see those prices move up to those levels that that makes sense and.

Ryan James Pfingst: And so we're keeping an eye on all those other markets; they continue to evolve and develop. And, I'll leave it there. We, you know, I know there's a lot of interest in SAF and hydrogen production from R&G, and we'll see how that evolves. Great, thank you. I'll turn it back. And our next question will be coming from Ryan Pfingst of B Riley. Your line is:

Adam: So we're keeping an eye on all of those other markets they continue to evolve and develop.

Adam: And.

Speaker Change: I'll leave it there.

Speaker Change: I know, there's a lot of interest in SaaS and hydrogen production from <unk>, and we'll see how that evolves.

Great. Thank you I'll turn it back.

Speaker Change: Thank you.

Speaker Change: And our next question will be coming from Ryan. Thanks.

Ryan: B Riley your line is open.

John: Hey, good morning, guys. And thanks for taking my questions. How are you guys thinking about M&A today? And maybe what are you seeing in the private market and how those valuations might compare to those of publicly traded companies? Hey, good morning, Ryan, John again.

Ryan: Hey, good morning, guys and thanks for taking my questions.

Ryan: Yes.

Ryan: How are you guys thinking about M&A.

Ryan: And maybe what are you seeing.

Unknown Executive: The private market and now those valuations might compare to those of publicly traded companies.

John: So, you know, obviously, there are a number of marks in the private market that continue to give us good confidence in the value of Opal Fuels and our vertically integrated business model. Private market transactions such as, you know, we talked about before, the Enbridge-Morrow really setting a mark as to where those valuations lie and that, you know, we believe that there is... a continuing desire on the part of market participants for gaining scale and that the industry is ripe for consolidation. Scale is certainly important here.

Speaker Change: Hey, good morning, Ryan John again so.

Speaker Change: Obviously, there is a number of marks in the private market that gives us continues to give us good confidence in the value of <unk> fuels in our vertically integrated business model.

Speaker Change: Private market transactions, such as we've talked about before the Enbridge Mauro.

Really setting a mark as to where those valuations lie.

Speaker Change: And.

Speaker Change: We believe that there is.

Speaker Change: As.

Speaker Change: A continuing desire on the part of market participants for gaining scale.

Speaker Change: The industry is ripe for consolidation.

Speaker Change: Scale is certainly important here.

Ryan James Pfingst: In addition to just the landfill opportunities, there are opportunities in adjacent markets as well that are very close to what we're doing, whether it's us acquiring somebody or somebody else acquiring us. We continue to see that there are good opportunities and valuations in the market. That being said, we really continue to believe that our organic growth model on vertical integration continues to be our core growth model and where we're going to be focusing. As we said earlier, we see a great set of opportunities on the development side with growing relationships and that there's a great amount of growth right in front of our noses just by executing the opportunities we have in front of us. Yeah, that makes sense. Thanks for that color.

Speaker Change: In addition to just the landfill opportunities theres opportunities in adjacent markets as well that are very close to what we're doing whether it's us.

Speaker Change: Acquiring somebody or somebody else acquiring us we continue to see.

Speaker Change: That there is good opportunities and valuations in the market that being said, we really continue to believe.

Our organic growth model on vertical integration continues to be.

Speaker Change: Our our core growth model, and where we're going to be focusing as we said earlier that we.

Speaker Change: C a.

Speaker Change: Great set of opportunities on the development side with growing relationships and.

Speaker Change: Great amount of growth right in front of our noses just on executing the opportunities we have in front of us.

Adam J. Comora: And maybe related, could you please provide us with any updated thoughts on how you guys are thinking about potentially solving for Opal's low float and maybe if M&A might be an avenue that you take there? Yeah, no, I think that's exactly right. And look, we, this is Adam here. We have tried to take some steps to address liquidity trading in the stock and that sort of thing. And, you know, we recently, or our majority control shareholder recently converted some super voting shares down into a new class share of class B.

Got it makes sense. Thanks for that color and then maybe related could you provide us with any updated thoughts on how you guys are thinking about potentially solving for pulp.

Speaker Change: <unk> slowed and maybe M&A might be an avenue that you take care.

Speaker Change: Yes, no I think thats exactly right and look we this is Adam here, we have tried to.

Speaker Change: Take some steps to address liquidity trading in the stock and that sort of thing and we.

Speaker Change: We recently are majority control shareholder recently converted.

Some supervoting shares down into a new class share of class B and.

Adam J. Comora: And, you know, we think that that puts us in a position to be considered for index inclusion and that sort of thing. And you know, maybe that potentially helps out trading liquidity in the stock as it relates to float.

Speaker Change: We think.

Speaker Change: That that.

Speaker Change: Puts us in a position to be considered for for indices inclusion in that sort of thing.

Speaker Change: <unk>.

Speaker Change: Maybe that potentially helps out trading liquidity in the stock as as it pertains to float I think M&A is an interesting Avenue there.

Adam J. Comora: I think M&A is an interesting avenue there. And, you know, we take a look at a lot of things. And, you know, as John mentioned, scale potentially makes sense.

Speaker Change: <unk>.

Speaker Change: We take a look at a lot of thanks and.

Speaker Change: As John had mentioned scale potentially make sense and.

Adam J. Comora: And, you know, M&A transactions could potentially make sense. And, you know, as our chairman likes to say, we like to find opportunities where 1 plus 1 equals 3, or he actually likes to say 1 plus 1 equals 5. So if we can find some opportunities where that makes sense, that certainly is a good way to increase our float. And so, but look, those kinds of things, you know, in terms of liquidity in the stock, they don't really drive the decisions here at Opal Fuels.

Speaker Change: M&A transactions could potentially make sense and as our chairman likes to say, we like to find opportunities, where one plus one equal three or he actually likes to say one plus one equals five.

Speaker Change: If we can find some opportunities.

Speaker Change: Where that makes sense.

Speaker Change: That certainly is a good way to <unk>.

Speaker Change: Kris are our float.

Speaker Change: And so but look those those kinds of things in terms of liquidity in the stock. They don't really drive the decisions here at <unk> at <unk> also really trying to maximize shareholder value in the long term and we believe we're doing that by building.

Adam J. Comora: We're really trying to maximize shareholder value in the long term, and we believe we're doing that by building, you know, a really powerful business and something that's going to generate a lot of free cash flow. Makes sense. Thanks for that detail. I'll turn it back. The next question will be coming from Paul Cheng of Scotiabank. Your line, Paul, your line is open.

Speaker Change: Really powerful.

Speaker Change: Business and something that is going to generate a lot of free cash flow.

Speaker Change: Makes sense, thanks for that detail ill turn it back.

And one moment our next question.

Speaker Change: Next question will be coming from Paul Cheng.

Paul Cheng: <unk> Bank your line is open.

Paul Cheng: Paul Your line is open.

Paul Cheng: Oh I'm sorry.

Speaker Change: <unk> come off of our DSI Cottingham of Nate.

Paul Cheng: Oh, I'm sorry, you were cut off earlier so I couldn't hear my, Hey guys, good morning. Good morning all, are we going to be okay? Yeah, I think this is for Scott. I have to apologize that there's a little bit of detail modeling.

Paul Cheng: Good morning.

Paul Cheng: Good morning, Paul Rooney, Okay.

Paul Cheng: Yes.

Paul Cheng: I think this is for Scott that to apologize that yes, I think it would be off the detailed modeling.

Paul Cheng: When in the PIMS, PIMS window, because before you get the certification, I assume that the gas is being stored in the storage. So when you report in the second quarter, the RNG warning for sales or production, will the production actually show up there? Or that you will essentially not be showing it, and then we have a big jump in the third quarter? Okay, Paul. This is John. I'll go through it just in a little bit of detail.

Speaker Change: When in the in the pens win.

Speaker Change: Women because before you get the simplification I assume that the gas is being stored in disposing folks when you report in the second quarter.

Speaker Change: And Q1 NIM for sales.

Speaker Change: Scott.

Speaker Change: The production actually still up there.

Speaker Change: Or that you were essentially not showing it and then we have a big jump in that quarter.

Speaker Change: Okay. Paul This is John I'll go through it and just a little bit of detail and then ill talk more in general but.

John: And then I'll talk more in general. But in essence, when we produce gas at our projects in a given month, we'll dispense that gas, essentially matching the gas production with our dispensing capacity on the downstream side to create those ring credits. Those RIN credits will be available for sale after minting the following month.

John: When we produce gas.

John: Our projects in a given month will dispense that gas.

John: Essentially matching the gas production with our dispensing capacity.

John: On the downstream side to create those RIN credits.

John: So production in April will be minted in May, and those credits will be available for sale in the May period. With respect to new projects, and especially with the new BRRR rules, we expect that our Prince William project will be grandfathered under the prior rules that yes, the gas will be stored. And that when we get that approval for Q-RIMS, which will take, you know, anywhere from a couple of weeks to, you know, six or so weeks, depending on the EPA's bandwidth, we'll then be able to dispense that gas.

John: Those RIN credits will be available for sale after maintaining the following month so production in.

John: April will be minted in may and those credits available for sale in the May period.

John: With respect to new projects, and especially with the new.

John: Our rules.

John: We expect that.

John: Prince William project will be.

John: Grandfathered under the prior rules.

John: Yes, the gas will be stored.

John: When we get that.

John: Approval for Q, Rems, which will take.

John: Anywhere from a couple of weeks too.

John: Six or so weeks, depending on the Epa's bandwidth that will then be able to dispense that gas. So if we dispense Prince William gas in June that gas will show up as minted credits in July.

John: So if we dispense Prince William gas in June, that gas will show up as minted credits in July when we'll be able to sell them. As new projects come online, like Sapphire in the third quarter and Pulk in the fourth, yeah, the new rules will likely cause us to lose the first months or partial months' worth of production based on how they qualify. But the basic timing is the same. I don't know, Adam. Yeah, no.

John: When we will be able to sell them.

John: As new projects come online like Sapphire in the third quarter and pulp in the fourth.

John: The new rules will likely cause.

John: US to lose the first months.

John: Or partial months worth of.

John: Production.

John: Based on how they are qualifying projects.

But the basic timing is the same I don't know Adam Yes, I just wanted to clarify one thing that John said there. So you will see all the production produced at Prince William Pollack <unk> Sapphire in the months that they produce as John was saying for Prince William It will.

Adam J. Comora: I just want to clarify one thing that John said there. So you will see all the production produced at Prince William, Pulk, and Sapphire in the months that they are on. As John was saying, for Prince William, it will, it has been, you know, our EPA certification is in, so we will get the RIN value on all of that gas produced in, you know, once we do get the final certification there. For Pulk and Sapphire, excuse me, yeah, for Pulk and Sapphire, we will have the production of that gas for the first, you know, whatever it is, two, four, six weeks; we'll just get the brown value of that fossil gas.

Adam: It has been our EPA certification is in so we will.

Adam: Get the RIN value on all of that gas produced and once we do get the final certification there.

Speaker Change: For bulk and SaaS fire excuse yes for.

Paul can sapphire, we will have the production of that gas for the first whatever it is 246 weeks.

Speaker Change: We'll just get the brown value that fossil gas. So all of that GAAP is included in our production guidance.

Adam J. Comora: So all of that gas is included in our production guidance. It's just a question of how long, you know, for those next couple of projects, will we just get the brown value versus getting the RIN certification for it. Does that make sense?

Speaker Change: It's just a question of how long for those next couple of projects, where we just get the brown value versus getting the RIN certification of it.

Paul Cheng: Yes, absolutely. Thank you. And Adam or John, do you have a cadence of what Prince William's ramp-up is going to look like for the remaining of the year? Well, I'm sorry, I didn't get the Prince William ramp-up.

Speaker Change: Okay that makes sense.

Speaker Change: Yes, absolutely. Thank you.

Speaker Change: And Adam what's wrong.

Speaker Change: Can you have attained tango paints women.

We're not going to look like for the remainder of the year.

Paul Cheng: Yeah, so look, project design, great project design proven. We think that the ramp up will be very good. The commissioning went very smoothly.

I'm, sorry, I didn't get the Prince William ramp up yes. So.

Speaker Change: Look.

Speaker Change: Project design, Great project design proven.

Speaker Change: We think that the ramp up will be very good the commissioning went very smoothly.

Speaker Change: <unk>.

Speaker Change: You kind of see the ramp up in real time, but because of the proven design, we really expect that.

<unk>.

Speaker Change: The lessons learned from prior projects will be applied to this one and we should see a good progression.

John: And, you know, you kind of see the ramp up in real time. But because of the proven design, we really expect that the lessons learned from prior projects will be applied to this one. And we should see a good progression. Adam, did you want to add to that?

Speaker Change: Adam did you want to add to that yes. The only thing I would say they are to us.

Adam J. Comora: Yeah, no, the only thing I would say there too is, and I'm not sure if we'll get questions on it in terms of capacity utilization and that sort of thing. But just keep in mind that we do build these facilities to where we expect them to mature and grow into. When you look at our inlet gas capacity, you know, we do expect these facilities to grow over time, and we do see good growth on a same store sale basis. So, but everything looks good at Prince William so far.

Adam: I'm not sure we'll get questions on it in terms of.

Adam: Capacity utilization in that sort of thing, but just keep in mind that we do build these facilities to where we expect them to mature and grow into when you look at our inlet.

Adam: Gas.

Adam: Capacity.

Adam: So.

Adam: We do expect these facilities to grow over time, and we do see good growth on on a same store sale basis same store sales.

Adam: <unk>.

Basis, so, but everything looks good a prince William so far large opening growing landfills projects built.

John: Yeah, large opening growing landfills, projects built to take advantage of that growth, and a proven design, all of which really contribute to that growth. Which really speaks to why we're confident in terms of, you know, reiterating our guidance and that sort of thing. Prince William was the chunkiest piece of production growth this year, and it was good that we completed that and are injecting gas into the pipeline. So we assume Pinswinner will get to about 80% by the end of the year? We're not going to give any specifics on any one facility.

Adam: Get to take advantage of that growth and.

Adam: And a proven design all of which really contribute to that growth. So that's really what it really speaks to why we're confident in terms of reiterating our guidance and that sort of thing is principally William was the chunky piece of production growth this year.

Adam: And it was good that we completed that in our injecting gas into the pipeline.

Adam: So we assume since when we get to about 80% plus.

Adam: We're not going to give any specifics on any one facility.

Paul Cheng: Paul, what we do is we try and give, because we do have a portfolio of projects, where we expect our overall inlet capacity utilization and utilization of inlet gas. We try and give more portfolio-level guidance versus just individual facilities. Okay, we'll do it. Thank you.

Speaker Change: Paul what we do is we try and give because we do have a portfolio of projects.

Speaker Change: Where we expect.

Paul: Our overall inlet capacity utilization.

Paul: Utilization of inlet gas, we try and give.

Paul: A more portfolio level guidance versus just individual facilities.

Paul: Okay. Thank you.

Alex Kania: In one moment for our next question. Our next question will be coming from Alex Kania of Marathon Capital. Your line is open. Hey, good morning.

Speaker Change: And one moment for our next question.

Speaker Change: Our next question will be coming from Alex Kania of Marathon capital. Your line is open.

Alex Kania: Hey, good morning.

Adam J. Comora: So two questions, hopefully. So the first one is just, you know, you express some cautious optimism about getting ITC clarity. Wondering if there's a timetable associated with that and then, you know, the coming months or quarters or what or whatnot. And the second one is just with respect to the, you know, rent forward sales, was that limited to just 2024?

So two questions hopefully the first one is just you expressed some cautious optimism on getting ITC clarity I'm. Just wondering if you think that there is a timetable associated with that in the coming months or quarters or whatnot.

Adam J. Comora: Or, you know, do you have any, were you able to sell forward any, you know, kind of future exposure? Okay, so thank you for the question. And I'm going to answer the second one first, because that's quick.

Alex Kania: And the second one is just with respect to the RIN forward sales was that limited to just 2024 or do you have any where you're able to sell forward any kind of future exposure into 'twenty and beyond.

Adam J. Comora: You know, there is a 2025 market starting to develop, but it's very thin. We have not transacted yet on 2025. I don't know if that'll show up until later in the year.

Speaker Change: So I. Thank you for the question and.

Speaker Change: I'm going to answer the second one first because that's quick.

Speaker Change: There is a 2025 market starting to develop but its very fine and we have not transacted, yet 25, I don't I don't know if that will show up until later in the year.

Speaker Change: And before I get into the specifics on the ITC I wanted to talk a little more broadly on a regulatory outlook because we do get a lot of questions on a potential Republican administration and.

Adam J. Comora: And before I get into the specifics on the ITC, I want to talk a little more broadly on our regulatory outlook, because we do get a lot of questions on a potential Republic administration. And, you know, what I want to say is a couple of things about that. First, I want to remind everybody the problem that we solve, which is fugitive methane emissions from, you know, waste in place, whether it's from landfills or manure or wastewater or food waste.

Speaker Change: What I want to say is a couple of things on that first I want to remind everybody of the problem that we solve which is fugitive methane emissions from.

Speaker Change: Waste in place, whether it's from landfills or manure wastewater food waste.

Speaker Change: And.

Speaker Change: That that molecule waste in place issue is starting to get a lot more attention.

Speaker Change: <unk>.

Speaker Change: Opel has a view that really what we should be doing as a better best strategy around that.

Speaker Change: The wrong answers to do nothing and.

Rather than doing nothing you can also capture these fugitive methane emissions at their sourcing flame, which also is not a great answer and we really believe that what we should be doing is this better best policy, which is which is converting them into either renewable power or RMG and I also.

Adam J. Comora: And, you know, that molecule waste in place issue is starting to get a lot more attention. And we really believe that what we should be doing is this better, best policy, which is converting it into either renewable power or RNG. And I also want to say we don't need any new policies or regulations to execute on our growth plans. And what we're really talking about here is what we can do to accelerate our business, which is more biomethane capture for productive use, which is really what, you know, the vast majority of Americans want to fight climate change and also public policymakers. And where it sort of breaks down, and I'm getting to the ITC specifically in a minute, but where it breaks down at times is that you get into a debate between molecules versus electrons.

Speaker Change: I want to say, we don't need any new policies or regulations to execute on our growth plans and what we're really talking about here is what we can do to accelerate our business, which is more biomethane capture for productive use.

Speaker Change: Which is really what the.

The vast majority of Americans want to fight climate change and also public policymakers and.

Where it sort of breaks down and I'm getting to the ITC, specifically in a minute, but where it breaks down at times is you get into a debate between molecules versus electronics and it shows up all over our business where.

Adam J. Comora: And it shows up all over our business where, you know, you have some very progressive climate folks that really want to electrify everything and feel like all molecules are bad. And you see that play out as people are contemplating what to do about heavy-duty fleets, whether to electrify everything or not. And, you know, don't really embrace any molecules and really aren't acknowledging that we have a molecule in place issue from all this waste that these fugitive methane, you know, sort of emissions come from.

Speaker Change: You have some very progressive climate folks that are really.

Speaker Change: Want to electrify everything and feel like all molecules are bad and you see that play out as people are contemplating what to do about heavy duty fleets, whether you electrify everything.

Speaker Change: And.

Speaker Change: Don't really embrace.

Speaker Change: Embrace any molecules and and really arent acknowledging that we have a molecule in place issue from all this waste that these fugitive methane emissions.

Speaker Change: Emissions come from.

Adam J. Comora: And then, you know, we've got folks on the perhaps the Republican side, which, by the way, are in favor of all sorts, you know, or we believe, you know, maybe we'll remove some of the blockages on molecule solutions. And it shows up, you know, when people are talking about, you know, how to use RNG in either hydrogen production or sap production or what to do about heavy-duty trucking. And, you know, we really believe there's an opportunity here to sort of, you know, get this, you know, get, you know, both sides of the aisle to really embrace this better, best strategy, and, you know, as it pertains to the ITC.

Speaker Change: Then we've got folks on the.

Speaker Change: Perhaps the Republican side.

Speaker Change: By the way are in favor of all sorts.

Speaker Change: Or are we believe maybe will remove some of the blockages on molecule solutions and it shows up when people are talking about how to use RMG in either hydrogen production of SaaS production or what to do about about heavy duty trucking.

Speaker Change: And.

Speaker Change: We really believe there is an opportunity here.

Speaker Change: To sort of.

Speaker Change: Get this get both sides of the aisle to really embrace.

Speaker Change: This better desk strategy and.

Speaker Change: Now as it pertains to the ITC.

Adam J. Comora: You know, there was an initial fix done where biogas property would be included. There are a couple of mechanical things that I think the industry has been asking for, specifically on landfills, on common ownership because we, you know, landfill owners typically own the collection system, and all the capital that's being invested, or the vast majority of the time, capital being invested does not own the collection system. And, you know, we're still optimistic that that could potentially be fixed and, you know, early summer is when we've been told we're going to hear on it. If that common ownership doesn't get fixed, there may be ways to structure around it.

Speaker Change: There was an initial fixed done where we're biogas property would be included there is a couple of mechanical things that that I think industry has been asking for specifically on landfills on common ownership because we.

Speaker Change: Landfill owners typically on the collection system and all the capital that's being invested or the vast majority of time capital invested.

Speaker Change: <unk> does not own the collection system and we're still we're still optimistic that that could potentially be fixed.

Speaker Change: And early summer as we've been told we're going to hear on it if that common ownership doesn't get fixed there may be ways to structure around it.

Adam J. Comora: So we're still cautiously optimistic that, you know, we will be able to utilize or qualify for those tax credits, but it's not totally done yet. And when we think about what we were talking about before, ways to turn this into a bipartisan issue and really accelerate, you know, sort of what we're doing and this fight against climate change, you can see it playing out in a number of different ways where, you know, if Biden wins the election, chances are you'll get some of those more positive public policies, whether it be E-RINs or something else.

Speaker Change: So we're still cautiously optimistic that.

Speaker Change: We will be able to utilize or qualify offer those tax credits but.

Speaker Change: It's not it's not totally done yet and.

When we think about what we were talking about before ways to turn this into a bipartisan issue and really accelerate sort of what we're doing and this fight against climate change you can see it play out in a number of different ways, where <unk> wins the election.

Speaker Change: Chances are you get some of those more positive public policies, whether it be E <unk> or something else.

Adam J. Comora: And, you know, if there is a Republican administration, maybe we will get more, what I would say, practical solutions around heavy-duty trucking, and maybe that will have positive implications for, you know, the Cummins 15-liter engine or, you know, more practical solutions on how to use RNG for renewable hydrogen. And by the way, even if we wanted to create renewable electricity from it, it makes more sense to take that RNG and bring it over to an efficient combined cycle plant. And, you know, by the way, RNG is the best answer for environmental justice. You know, it does the most to improve local air quality and that sort of thing.

Speaker Change: And.

Speaker Change: If there is a Republican administration, maybe we get more.

Speaker Change: What I would say practical solutions around heavy duty trucking and maybe that has positive implications for.

Speaker Change: Yes.

Speaker Change: The <unk> 15 liter engine.

Speaker Change: Or or more practical solutions on how to use RMG for renewable hydrogen and.

Speaker Change: Perhaps more embraced for making sure that we don't have issues that show up into the ITC.

Speaker Change: And we think Theres, a real opportunity there and.

Speaker Change: It's just really interesting that.

Speaker Change: When we talked to folks on the Democratic side were trying to explain to them that we have a molecule in place issue and we need things like the ITC and biogas conditioning and property and by the way even if we wanted to create renewable electricity from it it makes more sense to take that R&D and bring it over to inefficient.

Combined cycle plant and by the way R&D is the best answer for environmental Justice.

Speaker Change: Does the most to improve local air quality and that sort of thing and typically Republican typically shows up in Republican kind of sectors, whether it be AG or.

Adam J. Comora: And typically, Republican, you know, it typically shows up in Republican sectors, whether it be agriculture or, you know, all the countless municipalities out there. And, you know, from the electron side of things, we think there's a lot of Republicans that can get on board for more renewable power capture and production from this biomethane. You know, it's good baseload power because it enhances grid stability. It's energy security, and it usually shows up in more rural economies.

Speaker Change: The countless municipalities out there.

Speaker Change: And.

Speaker Change: From the from the Elektron side of things. We think there is a lot of Republicans that can get onboard for for more renewable power.

Speaker Change: Capture and production from from this Biomethane, it's good Baseload power it enhances grid stability its energy security and it usually shows up in more rural economies. So I know you specifically asked about the ITC.

Adam J. Comora: So, you know, I know you specifically asked about the ITC, but, you know, I just wanted to explain a little bit more because we do get a lot of questions on the Trump administration. And I'd remind everybody, we don't need any of these policies to execute on our business plan and really grow, you know, in ways that we've been talking about. We just think there's a real opportunity here to accelerate what we're doing and, quite frankly, accelerate our fight against climate change. Great, thanks so much for that answer.

Speaker Change: But.

Speaker Change: I just wanted to explain a little bit more because we do get a lot of questions on on a Trump administration and I'd remind everybody. We don't need any of these policies to execute on our business plan and really grow.

Speaker Change: In ways that we've been talking about we just think there's a real opportunity here to accelerate what we're doing and quite frankly accelerate our fight against climate change.

Speaker Change: Great. Thanks, so much for that answer.

Speaker Change: One moment for our next question.

Alex Kania: One moment for our next question. Our next question will be coming from Adam Bubes of Goldman Sachs. Adam, your line is, Hi, thanks for taking my question.

Speaker Change: Our next question will be coming from Adam Lewis of <unk>.

Adam Lewis: Goldman Sachs. Your line is open.

Adam Lewis: Adam Your line is open.

Adam Lewis: Alright, Thanks for taking my question.

Adam Samuel Bubes: In fuel station services, I was just wondering how many incremental owned and third-party stations you expect to complete in 2024 to hit the 75 to 90% EBITDA growth outlook and how you're thinking about the cadence of fuel station builds throughout the year? Adam, we do not typically give quarterly guidance in terms of to that level of granularity. We can get back to you in terms of the number of stations that'll come online.

Adam Lewis: And fuel station services, just wondering how many incremental owned and third party stations you expect to complete in 2024 to hit that 75% to 90% EBIT.

EBITDA growth outlook, and how youre thinking about the cadence of fuel station builds throughout the year.

Speaker Change: Adam we do not typically give quarterly guidance in terms of.

Adam Lewis: To that level of granularity, we can get back to you in terms of.

Adam Lewis: Sort of number of stations that will come online I think the first quarter. This year had seven incremental <unk> fuel owned stations versus last year.

Adam J. Comora: I think the first quarter of this year had seven incremental Opal Fuel-owned stations versus last year. And I would say Opal Fuel Station Services revenue and EBITDA growth comes from four different places, right? It's better utilization of our dispensing network, so we believe we're going to have more environmental credit revenue flowing through those sites. It also comes from improving margins in the construction business, where last year we were still cycling through some inflation issues.

Adam J. Comora: It does come from higher volumes, from new stations being commissioned, and also as you annualize last year's stations where you had partial years. And we still have growing volumes in the service side of the business. So it really comes from all four of those things.

Adam Lewis: And I would say overall fuel station services revenue and EBITDA growth comes from four different places right, it's better utilization of our dispensing network. So we believe we're going to have more.

Adam Lewis: Sort of environmental credit revenue flowing through those sites. It also comes from improving our margins in the construction business, where last year, we were still cycling through some inflation issues. It does come from higher volumes from from new stations being commissioned and also as you annualize last year.

Adam Lewis: Patients, where you had partial years and we still have.

Adam Lewis: Growing volumes in the service side of the business. So it really comes from all four of those things and.

Adam J. Comora: And you know, as we look further out, that's also where we get excited about the growth of that potential 15-liter Cummins engine as we move through 25 and 26. But this year, you know, the 24, growth, revenue, and EBITDA growth really come from the four pieces I was talking about. Got it. Thanks a lot.

Adam Lewis: As you look further out that's where also where we get excited about the growth of that potential 15 liter Cummins engine as we move through 'twenty five 'twenty six but this year. The 24 growth revenue and EBITDA growth really comes from the four pieces I was talking about.

Adam Samuel Bubes: And then any update on the two dairy projects, if there's been any resolution with the EPC contractors? And then, broadly, just can you update us on how you're thinking strategically about opportunities for dairy investments down the road? Sure, this is John.

Speaker Change: Got it thanks, a lot and then any update on the two dairy projects if theres been any resolution with the EPC contractors and then broadly just can you update us on how you're thinking strategically about opportunities for <unk>.

Gary investments down the road.

John: I'll give you an update. On our California dairy projects, there really is no update. Just as a reminder, there is a dispute with the EPC construction contractor regarding some change orders. The contractor is obligated under the EPC contract to continue working while the dispute is resolved.

Speaker Change: Sure. This is John I'll give you an update on on our California dairy projects. There really is no update just as a reminder, there is a dispute with the EPC construction contractor regarding some change orders.

John: We're proceeding with arbitration, which is continuing in due course, and the construction contractor's obligations are supported by a surety bond. So, it's in the process. Landfill R&G is a terrific opportunity, and there's a lot of room for growth in it. So, as we think about our organic growth and the core growth that we're going to be experiencing, that's really going to come from our deepening relationships and joint ventures with our partners in the landfill sector.

The contractors obligated under the EPC contract to continue working.

Speaker Change: If the dispute is resolved.

Speaker Change: Seeding with arbitration.

Speaker Change: Which is continuing in due course.

Speaker Change: The construction contractors obligations are supported by a surety bond. So it's in process as we think about growth.

Speaker Change: Let's just reiterate that.

Speaker Change: Landfill RMG is a terrific.

Speaker Change: Opportunity and there's a lot of space for growth in there. So as we think about our organic growth in the core growth that we're going to be experiencing that's really going to come from.

Speaker Change: Our deepening relationships and joint ventures, with our partners in the landfill sector.

John: However, we continue to explore other areas outside of landfill. So, the landfill will be the core of our growth, but, you know, there are numerous biomethane opportunities adjacent to the landfill sector. And in addition to dairy, we see opportunities in other agricultural waste, waste water itself, food waste, and other D3 and D5 gas streams.

Speaker Change: However, we continue to explore other areas outside of landfill. So landfill will be the core of our growth foot. There's there's.

Speaker Change: There is numerous biomethane opportunities adjacent to the landfill sector.

Speaker Change: And in addition to dairy.

Speaker Change: C.

Speaker Change: Opportunities in other agricultural waste.

Speaker Change: Wastewater itself.

Speaker Change: Food waste and other <unk>, three and <unk> five gas stream. So we continue to explore opportunities are expanding we believe that there is a really large opportunities.

Adam J. Comora: So, continue to explore opportunities for expanding; we believe that there is a really large opportunity set outside of landfill and dairy. And we think that over the course of the coming year, we'll be able to recognize some entry into those areas as we start growing beyond the landfill area. And then last one for me, you know, congratulations on placing the Cottonwood project into construction. Just wondering if you can tell us more about that partnership in terms of royalty, CapEx, you know; any further details would be great. Yeah, no, thanks, Adam.

Speaker Change: Outside of landfill and dairy.

Speaker Change: We think that over the course of the coming year, we will be able to recognize some.

Speaker Change: Entre into those areas as we start growing beyond the landfill area.

Speaker Change: And then last one for me congrats on placing the economy project into construction just wondering if you can tell us more about that partnership in terms of.

Speaker Change: Royalty capex.

Speaker Change: Any any further details would be great.

Adam J. Comora: This is Adam here, you know, royalties in line with our historical averages, the CapEx in line with our, you know, most recent experience of the last, I don't know, three, four projects, or two or three projects that we put into construction. And, you know, we had already previously 8K'd that. So, you know, you can see who the landfill partner is, and we still have a couple of more gas rights there than we had in an RFP.

Speaker Change: Yes no.

Speaker Change: Thanks, Adam this is Adam here royalty.

Adam Lewis: Royalties in line with our historical averages.

Adam Lewis: The Capex in line with our with our.

Adam Lewis: Most recent experience of last I don't know three or four projects are too.

Adam Lewis: Two or three projects that we put into construction and.

Adam J. Comora: And, you know, it's actually a testament to the experience of the team here at Opal Fuels, where it was a little bit of a development challenge to solve a pipeline issue there, which we were really happy that we were able to do. And, you know, I think it's when Opal executes on those types of projects that we gain confidence, you know, with our various partners out there.

Adam Lewis: We had already previously 8-K that so.

Adam Lewis: You can see that the landfill partner is.

Adam Lewis: We still have a couple of more gas rights. There that we had won in an RFP.

Adam Lewis: <unk>.

Adam Lewis: Look to continue to deepen that relationship and.

Adam Lewis: It's actually I would also really testament to the experience of the team here at <unk> fuels, where.

That.

Adam Lewis: It was a little bit of a development challenge to solve a pipeline issue there, which we were really happy that we were able to do.

Adam J. Comora: And, you know, we see it being completed in a typical timeframe, and, you know, excited about that one and excited about, you know, what else we're finding out there for the balance of the year in new projects. Great, congratulations to the team. Thank you.

Adam Lewis: I think I think it's when Opel executes on those types of projects that we gain confidence with our various partners out there and.

Adam Lewis: We see it being completed in a typical timeframe and.

Adam Lewis: Excited about that one and excited about.

Speaker Change: What else.

Speaker Change: We're finding out there for the balance of the year of new projects.

Speaker Change: Congrats to the team thank you.

Jimmy Larkin: One moment for our next question. Our next question will come from Jimmy Larkin of Piper Sandler. Hi, good morning.

Speaker Change: One moment for our next question.

Speaker Change: Our next question will come from Jimmy <unk> of Piper Sandler Your line is open.

Jimmy: Hi, good morning, Thanks for taking my question.

Adam J. Comora: I guess just on the dispensing side, could you maybe talk about what your CI mix is currently and kind of where you expect that to go in the future and, I guess, how that might impact? Yeah, no. I appreciate the question. So it's, it's a two-part question. The vast majority of Opal Fuels' production is landfill gas, and that can be anywhere from, you know, sort of 40 to mid-50s or 45 to 60 for a CI score. And we do just that, and we also obviously have our Sonoma project, which is significantly negative CI. John, negative 238, somewhere in that range, 283, 330, excuse me, 330.

Jimmy: I guess just on the dispensing side could you maybe talk about what your <unk> is currently.

Jimmy: And kind of where you expect that to go in the future and I guess, how that might impact how you place.

Jimmy: Gallons going forward.

Speaker Change: Yes, no I appreciate the question Sal.

Speaker Change: Two part question the vast majority of all fuels as production is landfill gas and that can be anywhere from sort of 40 to mid fifties 45 to 60 for a Ci score.

Speaker Change: And.

Sal: We do and we also obviously have our Sonoma project, which is significantly negative Ci.

Jimmy Larkin: And we also do dispense third-party gas, specifically at our California sites. We have a very large distribution network in California. And we do partner with third-party dairy suppliers to dispense their, you know, significantly negative CI through that, through that portfolio of dispensing stations. So I don't have the exact math if you blend the two, between what we're dispensing outside of California and what we're dispensing inside of California.

Sal: John negative $2 38 somewhere in that range to 80 to 830 excuse me $3 30.

Sal: And we also do dispense third party gas specifically at our California sites, we have a very large dispensing network in California.

Sal: Sure.

Sal: We do partner with third party dairy suppliers to dispense their us.

Sal: Significantly negative ci through that through that portfolio of dispensing stations.

Adam J. Comora: But we actually do think there's a good opportunity for us to continue to add low CI supplies through our California dispensing network. And through that, Matt, through that, we participate in the LCFS market really through that broad participation in the low CI third-party gas. And by the way, that shows up in our fuel station service segment in our environmental credit revenues piece, where as we continue to place more dairy gas either from Opal or other third-party suppliers through our California dispensing network, you'll see growth in that revenue segment for that business unit. Thank you.

Sal: No.

Sal: Don't have the exact math if you blend the two.

Sal: Between what we're dispensing outside of California, what we're dispensing inside of California.

Sal: But we actually do think theres, a good opportunity for us to continue to add low Ci supplies through our California dispensing network.

Through that math through that we participate in the <unk> market really through that broad participation in the low Ci third party gas.

And by the way that shows up in our in our fuel station service segment in our environmental credit revenues piece, whereas we continue to.

Sal: Place more dairy gas either from <unk> or other third party suppliers through our California dispensing network.

Sal: You'll see growth in that.

Sal: Revenue segment for that business unit.

Jimmy Larkin: I guess just one more. In the presentation deck, you mentioned eRent a few times. Are there any updates maybe on the potential for eRent going back? Or have you guys, you know, heard anything?

Speaker Change: Got it. Thank you I guess just one more.

Speaker Change: In the presentation deck, you mentioned year end a few times is there any updates maybe on the potential for egress coming back or have you guys heard any.

Speaker Change: On that front.

Adam J. Comora: Yeah, so this is Adam again here. And, you know, as I was chatting about before, we are, you know, at some point, we believe e rims will get included in the RFS. And the question is, when? And, you know, we have the belief that we may be able to get bipartisan support for it, where, you know, it's pretty clear that the Biden administration has been really supportive of inserting it into the program.

Speaker Change: Yes. So this is this is Adam again here and.

Adam Lewis: As I was chatting about before.

Adam Lewis: We are.

Adam Lewis: At some at some point, we believe E. Rins will get included into the RFS and the question is when.

Adam Lewis: And.

Adam Lewis: We have the <unk>.

Adam Lewis: Belief that we may be able to get bipartisan support for it.

Adam Lewis: <unk>.

It's pretty clear that the.

Adam Lewis: Biden administration has been really supportive of inserting them into the program.

Adam J. Comora: And we think it makes a lot of sense for a lot of the Republican constituents out there as well. And there are a variety of reasons for that, where, you know, if you look at the areas or sectors of the economy that benefit from it, a lot of them, you know, are in Republican-leaning areas.

Adam Lewis: And we think it makes a lot of sense for a lot of the Republican constituents out there as well.

Adam Lewis: Theres a variety of reasons for that were.

Adam Lewis: If you look at the areas or sectors of the economy that benefit from it a lot of them.

Adam Lewis: Our in Republican kind of areas and.

Adam Lewis: We don't believe it's a zero sum game with our corn or soy or other agricultural liquid biofuels that it really doesn't have any impact on the markets that they participate that for their for the rins that they potentially produce and.

Adam J. Comora: And, you know, we don't believe it's a zero sum game with corn or soy or other agricultural liquid biofuels that it really doesn't have any impact on the markets that they participate in for their for the rims that they, you know, potentially produce. And, you know, we'll see how effective we are in our education and advocacy around it for how quickly it could be adopted. I would say it is impactful for us not only on our existing portfolio but, quite frankly, on a lot of development opportunities.

Adam Lewis: We'll see how how effective will be on our in our education and advocacy around it for how quickly. It can be adopted I would say it is impactful for us not only on our existing portfolio, but quite frankly on a lot of development opportunities.

Adam Lewis: And.

Adam Lewis: And we think it's we think it's the right public policy so.

Adam J. Comora: And, and we think it's the right public policy. So I can't give you an exact timeframe when it will happen, but, you know, we think there's an opportunity to maybe talk about it this summer with EPA and see if we can get Republicans on board. So it wouldn't necessarily be repealed.

Adam Lewis: I can't give you an exact timeframe when.

Adam Lewis: But.

Adam Lewis: We think there is an opportunity to maybe talk about it this summer with EPA and see if we can get Republicans onboard so it wouldn't necessarily be repealed.

Adam Lewis: <unk>.

Adam Lewis: Okay.

Adam Lewis: If biden habits to win.

Adam Lewis: Then.

Adam Lewis: But obviously remain in place.

Adam Lewis: And.

Adam Lewis: That's where I was sort of talking about before where.

Adam J. Comora: And, you know, if Biden happens to win, you know, then, you know, it obviously will remain in place. And, you know, that's what I was sort of talking about before where, you know, we just like that particular issue earrings isn't zero sum for corn and soy. You know, we don't think the political outlook is zero sum for opal fuels because there are certain areas where the Republican administration maybe, you know, is more forward, you know, or, or, or, you know, on the molecule side of things. So anyway, it's something that we're still focused on. And, you know, we'll see how quickly they get adopted.

Adam Lewis: And just like.

Adam Lewis: That particular issue your incident zero, some FERC for corn and soy.

Adam Lewis: We don't think the political outlook as zero sum for Opel fuel is because there are certain areas, where Republican administration maybe.

Adam Lewis: <unk> is more forward or.

Adam Lewis: On the molecule side of things so anyway.

Adam Lewis: That we're still focused on end.

Adam Lewis: We'll see.

How quickly they get adopted.

Jimmy Larkin: Great, thanks for answering my questions; I'll turn it back. And our last question will be coming from Paul Cheng of Scotiabank. Your line is open.

Speaker Change: Great. Thanks for answering my questions and I'll turn it back.

Speaker Change: Okay.

Speaker Change: Thank you Andrew.

Speaker Change: And our last question will be coming from Paul Cheng of Scotiabank. Your line is open Paul.

Paul Cheng: Thank you. Hey, gentlemen, a real quick one. The utilization of in-net-get is 81%, which dropped 5% from the year-ago level.

Paul Cheng: Alright, thank you.

Paul Cheng: Gentlemen.

Paul Cheng: Real quick one.

Paul Cheng: Thanks.

Paul Cheng: With 81% or 5% from the year ago.

Paul Cheng: Overlap.

Paul Cheng: Within that particular lease contract anything to that.

Adam J. Comora: Is there any particular reason contributing to that? Thank you. Yeah, Paul, I was waiting for that one. And, you know, what I would, you know, get too hung up on either metric, the inlet capacity utilization or the utilization of inlet gas in any one particular quarter because we are a fast growing company. And we do have larger facilities that are coming online.

Speaker Change: Yes, Paul I was I was waiting for that one and.

Speaker Change: What I want what I want to first just say is I wouldn't.

Speaker Change: Get too hung up on either metric the inlet capacity utilization or the utilization of inlet gas in any one particular quarter. Because we are a SaaS growing company and we do have larger facilities that are coming online.

If you look at those two metrics year over year, our inlet capacity utilization went from 75% to 80% and that's when we're always talking about same store sales growth and areas where on our that's the amount of gas that's coming into our facilities and that comes from improvements of collection systems and that sort of thing.

Adam J. Comora: You know, if you look at those two metrics year over year, our inlet capacity utilization went from 75 to 80%. And that's when we're always talking about same store sales growth and areas where that's the amount of gas that's coming into our facilities. And that comes from improvements in collection systems and that sort of thing. And the metric you were asking about is then the utilization or the efficiency of turning that raw biogas into the final product.

Speaker Change: And the metric you were asking about is then the utilization of the efficiency of turning that.

Speaker Change: Raw biogas into into final product and Thats, where it went from 86% down to 81% year over year, but if you look at it sequentially quarter over quarter, the fourth quarter inlet.

Adam J. Comora: And that's where it went from 86% down to 81% year over year. But if you look at it sequentially, quarter over quarter, you know, the fourth quarter inlet, or the utilization of inlet gas, went from 79 up to 81. And really, what you're seeing here is the ramp of Emerald, and we expect those trends to continue throughout the year. And that being said, as I was talking earlier about Prince William now in operations, you may see when a big facility comes online, your inlet capacity utilization drop, you know, or have an impact from one of those larger facilities as it ramps up. So specifically in the quarter, we did see it ticked up slightly from 79 up to 81.

Speaker Change: Are the utilization of inlet gas went from 79 up to 81 and really what Youre seeing here is the ramp of Emerald and.

Speaker Change: We expect those trends to continue throughout the year and that being said as I was talking earlier about Prince William now in operations.

Speaker Change: You may see when a big facility comes online your inlet capacity utilization drop.

Adam J. Comora: But year over year, 86 down to 81, you know, was really that Emerald facility being in this year's metric versus versus not the last year and not outside of our expectations, by the way, which is why we also talked about this range of 80 to 90% on both of those on both of those factors, which can be skewed, as I was saying, as new facilities come online. And, you know, we feel like Emerald's ramping well.

Speaker Change: Or have an impact from one of those larger facilities as it ramps up so specifically in the quarter. We did see it tick up slightly from 79 up to 81, but year over year 86 down to 81.

Speaker Change: That.

Speaker Change: That emerald facility being in this years.

Speaker Change: Metric versus versus not the last years and not outside of our expectations by the way, which is why we also talk about this range of 80% to 90% on both of those on both of those factors, which can be skewed as I was saying as as new facilities come online.

Adam J. Comora: And I want to say, you know, we used to get asked a lot of questions about this partnership model or JV model or why do you partner with landfills and these types of projects because, you know, GFL, who's been a great partner of ours, was one of the forward-thinking, one of the first movers or forward thinkers to invest capital alongside us in these types of projects. And, you know, I have to say, working with GFL, specifically on that project, it's really a testament to that partnership model, where we're fully aligned to continue to ramp up and maximize the quality and the quantity of the gas that's that's coming into that facility. And, you know, if we went back five or six years ago, it was really tough to get the attention of landfills to focus on those types of improvements and that sort of thing.

Speaker Change: And we.

Speaker Change: We feel like Emerald is ramping well and I want to say, it's also we used to get asked a lot of questions about this partnership model or JV model why do you partner with landfills in these types of projects because tfl.

Speaker Change: Who has been a great partner of ours was one of the forward thinking.

Speaker Change: One of the first movers are forward thinkers.

Speaker Change: Invest capital alongside of US in these types of projects and.

Speaker Change: I have to say working with Tfl specifically on that project, it's really a testament to that partnership model, where we're fully aligned to continue to ramp and maximize the quality and the quantity of the gas.

Speaker Change: That's coming into that facility and we went back five or six years ago. It was really tough to get the attention of landfills to focus on those types of improvements in that sort of thing so.

Adam J. Comora: So, you know, the short answer is, you know, you can't just look at it year over year on those types of metrics because you have new facilities that are coming in and ramping up. But, you know, we, you know, you have to look at those things in conjunction and what else is happening in the portfolio. Very good, thank you. I end up showing no further questions at this time. I would now like to turn the call back to management for closing remarks. All right, this is Adam Comora.

Speaker Change: The short answer is yes.

Speaker Change: You can't just look at it year over year on those types of metrics because you have new facilities that are coming in and ramping.

Speaker Change: But.

Speaker Change: You have to look at those things in conjunction with what else is happening in the portfolio.

Speaker Change: Very good thank you.

Speaker Change: And Im showing no further questions at this time I would now like to turn the call back to management for closing remarks.

Adam J. Comora: Thank you very much for joining us on our first quarter call and I hope everybody has a great day. This concludes today's conference. Thank you for participating. You may now disconnect. [inaudible] Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? Thanks for watching! Good morning and welcome to the Opal Fuels first quarter 2024 earnings call-in webcast. At this time, all participants are in a listen-only mode.

Speaker Change: Alright. This is out of tomorrow. Thank you very much for joining us on our first quarter call and I hope everybody has a great day.

Speaker Change: This concludes today's conference. Thank you for participating you may now disconnect.

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Speaker Change: Good morning, and welcome to the Opel fuels first quarter 2024 earnings call and webcast. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone you will then hear messages automated message advising.

Operator: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised.

Speaker Change: Your hand is raised to withdraw your question. Please press star one again as a reminder, this event is being recorded I would now like to turn the call over to Todd Firestone Vice President of Investor Relations. Please go ahead.

Todd Firestone: To withdraw your question, please press star 11 again. As a reminder, this event is being recorded. I would now like to turn the call over to Todd Firestone, Vice President of Investor Relations. Please go ahead.

Todd Firestone: Thank you, and good morning, everyone. Welcome to the Opal Fuels first quarter 2024 earnings conference call. With me today are co-CEOs Adam Comora and Jonathan Maurer, and Scott Contino, Opal's interim chief financial officer. Opal Fuels released financial and operating results for the first quarter of 2024 yesterday afternoon, and those results are available on the investor relations section of our website at opalfuels.com. The presentation and access to the webcast for this call are also available on our website. After the completion of today's call, a replay will be available for 90 days.

Thank you and good morning, everyone. Welcome to the open fuels first quarter 2024 earnings Conference call with me today are co CEO that Brian Moore, and Scott <unk> interim Chief Financial Officer.

Todd Firestone: Although fuels released financial and operating results for the first quarter of 2024 yesterday afternoon, and those results are available on the Investor Relations section of our website at <unk> Dot com.

Todd Firestone: The presentation and access to the webcast for this call are also available on our website.

Todd Firestone: After completion of today's call a replay will be available for 90 days.

Todd Firestone: Before we begin, I'd like to remind everyone that our remarks, including answers to your questions, are forward-looking statements about risk, uncertainties, and assumptions. Forward-looking statements are not a guarantee of performance, and actual results could differ materially from what is contained in such statements. Factors That Could Cause or Contribute.

Speaker Change: Before we begin I'd like to remind everyone that our remarks, including answers to your questions contain forward looking statements, which involve risks uncertainties and assumptions.

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

Speaker Change: The factors that could cause or contribute to.

Todd Firestone: These such differences are described on slides two and three of our presentation. These forward-looking statements reflect our views as of the date of this call, and Opal Fuels does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the day that. Additionally, this call will contain discussion of certain non-GAAP measures; a definition of non-GAAP measures used in the reconciliation of these measures to the nearest GAAP measure is included in the appendix of the release and presentation.

Speaker Change: Such differences are described on slide two or three of our presentation. These forward looking statements reflect our views as of the date of this call and <unk> fuels does not undertake any obligation to update forward looking statements to reflect events or circumstances. After the date of this call.

Speaker Change: Additionally, this call will contain discussion of certain non-GAAP measures a definition of non-GAAP measures used in the reconciliation of these measures to the nearest GAAP measure is included in the appendix of the release and presentation.

Todd Firestone: Adam will begin today's call by providing an overview of the course results, recent highlights, and an update. Co-CEO, Opal Fuels. Good morning, everyone, and thank you for participating in Opal Fuel's first quarter 2024 earnings call. 2024 is off to a solid start.

Speaker Change: Adam will begin today's call by providing an overview of the quarters results recent highlights and an update on our strategic and operational priorities. John will then give a commercial and business development update after which Scott will review financial results. We'll then open the call for questions and now I'll turn the call over to Adam <unk> fuels.

Adam J. Comora: Our first quarter results were in line with our expectations, and we remain on track to meet our full year guidelines. With strong RIN pricing, stable production from operating facilities, strong performance and growth for more fuel station service segments, and new facilities remaining on schedule, we expect to see a nice progression of production and earnings growth throughout. Adjusted EBITDA for the quarter was approximately $15 million, in line with last quarter's results when taking into consideration the approximately $16 million of health environmental credit inventory we sold in the final quarter of 2020.

Adam Lewis: Good morning, everyone and thank you for participating in <unk> first quarter 2024 earnings call 2024 is off to a solid start our first quarter results were in line with our expectations and we remain on track to meet our full year guidance with stronger and pricing stable production from operating facilities.

Strong performance and growth for more fuel station service segment and new facilities remaining on schedule, we expect to see a nice progress in our production and earnings growth throughout the year.

Adam Lewis: Adjusted EBITDA for the quarter was approximately $15 million in line with last quarter's results when taking into consideration the approximately $16 million of health environmental credit inventory, we sold in the final quarter of 2023.

Adam J. Comora: Our vertical integration continues to position us well to take advantage of the supportive market fundamentals for D3 RINs in the RFS market, which benefits both our R&G fuel business segment and our fuel station services division as we place more R&G towards dispensing. We've locked in pricing for the majority of our forecasted 2024 RIN production, which provides us with visibility and helps to de-risk 2024 in terms of full year financial performance. Operationally, production and efficiency measures were in line with our expectations.

Adam Lewis: Our vertical integration continues to position us well to take advantage of the supportive market fundamentals for <unk> in the RFS market, which benefits both our R&D fuel business segment, and our fuel station services Division as we place more R&D into our dispensing network, we have locked in pricing for the majority of our forecasts.

Adam Lewis: In 2020 for RIN production, which provides us visibility and helps to de risk 2024 in terms of full year financial performance.

Adam Lewis: Operationally production and efficiency measures were in line with our expectations production of 0.8 million Btu from our operating facilities remained stable and growing on a same store basis with inlet design capacity utilization and utilization of inlet gas remaining between 80% to 90%.

Adam J. Comora: Production of 0.8 million MMBTU from our operating facilities remains stable and growing on a same store basis with inlet design capacity utilization and utilization of inlet gas remaining between 80 to 90, consistent with our prior disclosures and above industry average. We are very excited to announce that our ninth R&G facility, Prince Williams, has recently commenced operations. John will provide more details later in the letter. We also continue to execute on our growth objectives and today are announcing that construction has begun on our 15th R&G project at the Cottonwood Landfill. The project will have an initial design capacity of approximately 0.7 million MMBTU and is 100% owned by Opal Fuels.

Adam Lewis: Consistent with our prior disclosures and above industry averages.

Adam Lewis: We are very excited to announce that our ninth R&D facility Prince William has recently commenced operations John will provide more details later in the call. We also continue to execute on our growth objectives and today, we're announcing that construction has begun on our 15th R&D project with the Cottonwood landfill. The project will have an initial does.

Adam Lewis: <unk> capacity of approximately 0.7 million Btu and is 100% owned by <unk> fuels, we expect the Cottonwood facility construction period to be in line with our recent projects, we continue to make meaningful progress with our development projects and partners and feel confident that we will meet or exceed our 2 million.

Adam J. Comora: We expect the Cottonwood facility construction period to be in line with our recent projects. We continue to make meaningful progress with our development projects and partners and feel confident that we will meet or exceed our $2 million annual MMBTU target for new R&G projects entering construction this fall. As previously mentioned, our fuel station services segment continues to perform and grow in line with our expectations. As we mentioned during our last earnings call, we remain cautiously optimistic that the IRS will clarify the rules governing ITC eligibility for landfill gas for R&G products.

Adam Lewis: Annual <unk> target for new R&D projects entering construction this year.

Adam Lewis: As previously mentioned our fuel facing services segment continues to perform and grow in line with our expectations.

Adam Lewis: As we mentioned during our last earnings call. We remain cautiously optimistic that the IRS will clarify the rules governing ITC eligible.

Ability for our landfill gas to R&D projects. Although we did not include any ITC proceeds in the guidance. We issued in March we are hopeful that our new R&D projects will benefit from ITC as we believe was intended.

Adam J. Comora: Although we did not include any ITC proceeds in the guidance we issued in March, we are hopeful that our new R&G projects will benefit from ITC as we believe was intended. We often talk about industry talent, and we continue to believe there is a great opportunity to expand bipartisan support for the industry. It is important to remember what we do. We capture harmful methane emissions from decaying organic waste and convert them into productive and low carbon intensity energy products that drop fuels, which utilize existing pipelines and electricity. There is growing interest in what should be done with waste-in-place methane molecules.

Adam Lewis: We often talk about industry tailwind and we continue to believe there is a great opportunity to expand bipartisan support for our industry. It is important to remember what we do we capture harmful methane emissions from Dk, all organic waste and convert them into productive and low carbon intensity energy products.

Adam Lewis: That are dropping fuels, which utilize existing pipeline and electricity grid.

Adam Lewis: Growing interest in what should be done with waste in place methane molecules and we believe <unk> is well positioned to be a leader in their capture conversion and marketing with proven technology and a proven track record with that I'll turn it over to John John.

Adam J. Comora: And we believe Opal is well positioned to be a leader in their capture, conversion, and marketing with proven technologies and a proven track record. With that, I'll turn it over to John.

John: Thank you, Adam, and good morning, everyone. We're proud of our accomplishments this quarter and, as Adam mentioned, believe we are well positioned to see a nice progression of production and earnings growth over the course of this year in line with our guidance. There are two main reasons for this. First, we have clear visibility to R&D production growth from new projects coming online this year, and second, we expect continued growth from our operating projects with respect to new projects coming online in 2024.

Thank you Adam and good morning, everyone.

John: We're proud of our accomplishments this quarter and as Adam mentioned believe we are well positioned to see a nice progression of production and earnings growth over the course of this year in line with our guidance.

John: There are two main reasons for this outlook.

John: First we have clear visibility to RMG production growth from new projects coming online this year and second.

John: We expect continued growth from our operating projects.

John: With respect to new projects coming online in 2024.

John: We are very excited to announce that our ninth R&G facility, Prince William, has recently commenced operation and is expected to contribute meaningfully as it ramps production as we move through this. Prince William, combined with Sapphire and Pulse, which are on schedule to begin operations in the third and fourth quarters respectively, provide the roadmap for us exiting 2024 with 8.8 million MMBTU of annual design capacity in operation, compared to 3.9 and 5.2 million MMBTU of annual design capacity in operation, respectively. Significantly, the project has been producing pipeline quality gas, and we have submitted the documentation for registration of the Prince William project under the current RFS rules with the EPA.

John: We are very excited to announce that our ninth RMG facility Prince William has recently commenced operations and is expected to contribute meaningfully as it ramps production as we move through this year.

John: Prince William combined with Sapphire in Polk, which are on schedule to begin operations in the third and fourth quarters, respectively.

John: Provides a roadmap for us exiting 2024 with eight 8 million Mmm Btu of annual design capacity in operation compared.

John: Compared to three nine and five to exiting 2022 and 2023, respectively.

John: Significantly the project has been producing pipeline quality gas and we have submitted the documentation for registration of the principal aim project under the current RFS rules with the EPA.

John: With Prince William, we now have nine R&G projects in operation with an aggregate annual design capacity of 7.0 million MMBTU, tripling since year-end 2021. Then, with respect to increasing output from operating projects, Looking at the first quarter results, R&G production increased to 0.8 million mmBtu from 0.6 million mmBtu in the first quarter of 2020. The increase is largely due to the Emerald RNG project's contribution to production volume, and was also complemented by same store sales growth from our other operating projects.

With Prince William we now have nine R&D projects in operation with an aggregate annual design capacity of $7 million Mmm Btu tripling since year end 2021.

John: Then with respect to increasing output from operating projects.

John: Looking at the first quarter results RMG production increased to $1 8 million Btu from one 6 million Btu in the first quarter of 2023.

John: The increase was largely due to the Emerald R&D projects contribution to production volumes.

John: And when it's also complemented by same store sales growth from our other operating projects.

John: These are trends that we expect to continue throughout 2020. In addition to our operating projects, we currently have six R&D projects in construction representing an additional 3.3 million MMBTU of annual design. Combined, our portfolio of projects in construction and in operations now has a total of 10.3 million MMBTU of annual design. Sapphire, which is one of our 50-50 joint venture projects with GFL, is on track to begin operations in the third quarter of this. Our share of the annual design capacity of SAFIRE is 0.8 million MMP.

John: These are trends that we expect to continue throughout 2024.

John: In addition to our operating projects. We currently have six R&D projects in construction, representing an additional $3 3 million Mmm Btu of annual designed capacity.

John: Bind our portfolio of projects in construction and in operations now has a total of $10 3 million Btu annual design capacity.

John: Sapphire, which is one of our 50 50 joint venture projects with GSL is on track to begin operations in the third quarter of this year.

John: Our share of annual design capacity at Sapphire is <unk> 8 million Btu.

John: Our Polk County, Florida project, where we own 100%, remains on track to begin operations in the fourth quarter of this year. Hope County represents 1.1 million MMBTU of annual design capacity. Atlantic, our first R&G joint venture with South Jersey Industries, which we put into construction in the third quarter of 2023, is progressing, and we continue to expect it to begin commercial operations in mid-2025. Opal's share of annual design capacity at Atlantic is 0.3 million MMB.

John: Our pulp County, Florida project, where we own 100% remains on track to begin operations in the fourth quarter of this year.

John: Polk County represents $1 1 million Btu of annual design capacity.

John: Atlantic Our first R&D joint venture with South Jersey industries, which we put into construction in the third quarter of 2023 <unk>.

John: Is progressing and we continue to expect it to begin commercial operations in mid 2025.

John: <unk> share of annual design capacity at Atlantic.

John: <unk> 3 million Btu.

John: As Adam mentioned, we feel confident that we will meet or exceed our 2.0 million annual MMBTU target for new R&G projects entering construction this year. I also want to add a word on development and our pipeline of opportunities. We remain encouraged by our deepening industry relationships and partnerships, and continue to see a robust opportunity set of attractive landfill R&G development projects. We also continue to explore opportunities to capture and convert biogas from other feedstocks, as a natural extension of our core business. With that, I'll turn it over to Scott to discuss the quarter's financial performance. Scott.

John: As Adam mentioned, we feel confident that we will meet or exceed our $2.1 billion annual <unk> target for new R&D projects entering construction this year.

Speaker Change: I also want to add a word on development in our pipeline of opportunities. We remain encouraged by our deepening industry relationships and partnerships and continue to see a robust opportunity set of <unk>.

Speaker Change: Tractive landfill R&D development projects.

Speaker Change: We also continue to explore opportunities to capture and convert biogas from other feedstocks as a natural extension of our core business.

Speaker Change: With that I'll turn it over to Scott to discuss the quarter's financial performance Scott.

Scott Contino: 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 results for the quarter ending March 31st, 2024. Our 10-Q will be filed later today. Revenue in the first quarter was $65 million, as compared to $43 million in the first quarter of 2020. The main driver for the increase in revenues was the timing and pricing of environmental credit sales, including both R&G fuel and fuel station services where we dispense all of the R&G for our own use, as well as for our joint venture projects and other third-party R&D. Net income for the first quarter was approximately $0.7 million.

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

Scott: Last night, we filed our earnings press release, which details our quarterly results for the quarter ending March 31, 2020 for our 10-Q will be filed later today.

Scott: Revenue in the first quarter was $65 million as compared to $43 million in the first quarter of 2023.

Scott: The main driver for the increase in revenues was the timing and pricing of environmental credit sales, including both RMG fuel and fuel station services, where we dispense all of the RMG for our projects as.

Scott: As well as for our joint venture projects and other third party LNG supplies.

Scott: Net income for the first quarter was approximately zero point $7 million as compared to $7 3 million net loss in the first quarter of 2023. The difference was primarily driven by the increase in revenues from the timing of environmental credit sales, but also recognition of the Emerald <unk>.

Scott Contino: As compared to a $7.3 million net loss in the first quarter of 2023, the difference was primarily driven by the increase in revenues from the timing of environmental credit sales, but also recognition of the Emerald R&G project coming online, accounted for in the equity method. Adjusted EBITDA was $15.2 million in the first quarter, compared to a negative $1.6 million in the first quarter of 2023, which, as mentioned, was driven by the timing of management's decision to hold back RIN sales in the first half of 2023 and production from the Emerald R&G project during Q1 2024.

Scott: <unk> projects coming online and accounted for in equity method investments.

Scott: Adjusted EBITDA was $15 2 million in the first quarter compared to a negative $1 6 million in the first quarter of 2023, which as mentioned was driven by the timing of management's decision to hold back RIN sales in the first half of 2023.

Scott: And production from the Emerald RMG project during Q1 2024.

Scott Contino: A reconciliation to gap results is provided in our earnings release from yesterday and in our investor presentation updated this morning on our website. The RNG fuel segment revenues were $17.7 million for the first quarter, as compared to $6.7 million in the first quarter of 2023. The increase in revenues was primarily due to higher RIN sales and production growth. Fuel Station Services segment revenues were $37.1 million for the first quarter as compared to $20.8 million in the first quarter of 2023.

Scott: A reconciliation to GAAP results is provided in our earnings release from yesterday and in our Investor presentation updated this morning on our website.

Scott: The RMG fuel segment revenues were $17 7 million for the first quarter as compared to $6 7 million in the first quarter of 2023.

Scott: The increase in revenues was primarily due to higher RIN sales and production growth.

Scott: The fuel station services segment revenues were $37 1 million for the first quarter as compared to $20 8 million in the first quarter of 2023.

Scott Contino: The increase in revenues demonstrates the power of our vertically integrated business model and was primarily the result of higher utilization of our dispensing capacity, new Opal-owned fueling stations coming online, and Third Party Construction Revenue. Renewable power revenues were $10.1 million for the quarter compared to $15.4 million in the first quarter of 2023.

The increase in revenues demonstrates the power of our vertically integrated business model and was primarily the result of higher utilization of our dispensing capacity, new Opal owned fuelling stations coming online and third party construction revenues.

Scott: Renewable power revenues were $10 1 million for the quarter compared to $15 $4 million in the first quarter of 2023.

Scott Contino: This decrease is primarily due to Emerald R&G, which is using gas that was previously available for a renewable power facility. In the first quarter, capital expenditures were approximately $37.7 million, which includes approximately $10.9 million relating to equity method investments and approximately $3.8 million associated with downstream stations. We continue to expect our capital expenditures to be in line with our 2024 full-year guidance. Our senior secured credit facility provides up to $450 million of term loans over an 18 month draw period and $50 million of revolving credit.

This decrease is primarily due to Emerald RMG, which is using gas that was previously available through for a renewable power facility.

Scott: In the first quarter capital expenditures were approximately $37 $7 million, which includes approximately $10 $9 million relating to equity method investments.

Scott: And approximately $3 $8 million associated with downstream stations.

Scott: We continue to expect our capital expenditures to be in line with our 2020 for full year guidance.

Scott: Our senior secured credit facility provides up to $450 million of term loans over an 18 month draw period and $50 million of revolving credit.

Scott Contino: As of March 31, 2024, approximately $187 million was drawn down on the facility, and we have utilized approximately $14 million of our revolver availability to issue letters of credit. As of March 31, 2024, our liquidity was approximately $334 million, consisting of $300 million of availability under the credit facility and $34 million of cash, cash equivalents, and short-term investments.

Scott: As of March 31, 2020 for approximately $187 million was drawn down on the facility and we have utilized approximately $14 million of our revolver availability to issue letters of credit.

As of March 31, 2020 for liquidity was approximately $334 million consisting.

Scott: <unk> of $300 million of availability under the credit facility and.

And $34 million of cash cash equivalents and short term investments as a result, we feel our liquidity and capital resources and access to other sources of capital are sufficient for our growth plans.

Scott Contino: As a result, we feel our liquidity and capital resources and access to other sources of capital are sufficient for our growth plan. With that, I'll turn it back to John for his concluding remarks. In closing, we are pleased with the continuing success in the execution of our business, and we expect to see a nice progression of production and earnings growth throughout the year. As noted previously, we continue to be cautiously optimistic about clarification of ITC rules for our landfill gas to RNG. We remain committed to furthering Opal's vertically integrated mission.

Scott: With that I'll turn it back to John for concluding remarks.

John: In closing we are pleased with the continuing success in the execution of our business plan and we expect to see a nice progression of production and earnings growth throughout the year.

John: As noted previously we continue to be cautiously optimistic about clarification of ITC rules for our landfill gas to R&D projects.

John: We remain committed to furthering <unk> vertically integrated mission.

John: Build and Operate Best-in-Class Biogas Capture and Conversion Projects that deliver industry-leading, reliable, and cost-effective low-carbon-intensity energy products that displace fossil fuels and mitigate climate change. With that, I'll turn the call over to the operator for Q&A. Thank you all for your interest in Opal. As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced.

John: To build and operate best in class biogas capture and conversion projects that deliver industry, leading reliable and cost effective low carbon intensity energy products that displace fossil fuels and mitigate climate change.

Speaker Change: With that I will turn the call over to the operator for Q&A.

Speaker Change: Thank you all for your interest in Opal fuels.

Speaker Change: Certainly as a reminder to ask a question. Please press star one on your telephone to your name to be announced.

Operator: To withdraw your question, please press star 11 again. Please stand by while we assemble the Q&A roster. One moment for our first question. Our first question will be coming from Derrick Whitfield of Stiefel. Your line is open. Good morning, all, and thanks for your question.

Speaker Change: Withdraw your question. Please press star one again, please standby, while we assemble the Q&A roster.

Speaker Change: One moment for your first question.

Speaker Change: Our first question will be coming from Derrick Whitfield of Stifel. Your line is open.

Derrick Lee Whitfield: Good morning, all and thanks for your time.

Derrick Lee Whitfield: Good morning Derik.

Derrick Lee Whitfield: I'd like to start with your adjusted EBITDA guidance for the year. Is it safe to assume you remain comfortable with the 2024 guidance based on your line of sight to production growth and your decision to sell forward RENs, which, in combination, derisks the revenue line? Derrick, thanks very much for your question.

Derrick Lee Whitfield: I'd like to start with your adjusted EBITDA guidance for the year is it safe to assume you remain comfortable with the 2024 guidance based on your line of sight to production growth and your decision to sell forward rents, which in combination de risks the revenue line item.

Adam J. Comora: Yes, Opal Fuels continues on track to meet its guidance. We forecast a progression of increasing output and EBITDA as Prince William ramps up. Prince William is really gonna be kind of a major contributor during the course of the year, while Paul and Sapphire will come on in the fourth and third quarters, respectively, contributing towards the end of the year. It's really the ramp-up of Prince William.

Derrick Lee Whitfield: Derek Thanks, very much for your question, Yes, Opel fuels continues on track to meet its guidance we.

Derrick Lee Whitfield: Forecast progression of increasing output and EBITDA.

Derrick Lee Whitfield: Principally I'm ramps up.

Derrick Lee Whitfield: William is really going to be kind of a major contributor during the course of the year while pulp.

Derrick Lee Whitfield: And Sapphire will come on in the fourth and third quarters, respectively.

Derrick Lee Whitfield: Contributing towards the end of the year, it's really the ramp up of Prince William as we said we.

Adam J. Comora: As we said, we put our paperwork in with the EPA for the project to produce RINs. And we expect that we'll be dispensing from that project at the end of the second quarter, and it'll really start contributing starting in the third quarter and through the fourth quarter. So that's really the progression that we see here. As you alluded to, and we said before, we've sold a majority of the RINs that we expect to produce this coming year.

Derrick Lee Whitfield: Put our paperwork in to the EPA for the project to produce rents.

Derrick Lee Whitfield: And we expect that we will be dispensing from that project at the end of the second quarter and it will really be contributing starting in the third quarter and through the fourth quarter. So that's really the progression that we see here.

Derrick Lee Whitfield: Okay as you alluded and we said before we've sold a majority of the Rins that we expect to produce this coming year and we believe that that significantly de risks, our EBITDA and cash flows for the year.

Adam J. Comora: And we believe that that significantly de-risked our EBITDA and cash flows for the year. And, you know, as I alluded, our construction projects will start to contribute towards the end of the year. And so we'll see a little more bump right at the end of the year.

Derrick Lee Whitfield: <unk>.

Derrick Lee Whitfield: As I alluded, our construction projects will start to contribute towards the end of the year and so.

Derrick Lee Whitfield: We will see a little more bump right at the end of the year. So we feel really good about where we are on track for our EBITDA.

Adam J. Comora: So we feel really good about where we are on track for our EBITDA. Our R&G production, our projects into construction, we announced, obviously, the Cottonwood project, and we think that we'll have a progression of announcements over the next several months that will continue that positive progression as we move towards that guidance. [inaudible] will also hit our guidance that we're looking for. CapEx obviously is related to our projects in construction. The projects in construction continue on time and on budget, and while billings may be a little bit slower at the front end of a project, they accelerate as you get closer to. So, the long answer to your question; the short answer is: That's that's great.

Derrick Lee Whitfield: R.

Derrick Lee Whitfield: RMG production.

Derrick Lee Whitfield: Our projects into construction.

Derrick Lee Whitfield: We announced obviously the Cottonwood project.

Derrick Lee Whitfield: We think that will have a progression of announcements over the next several months that will continue that positive progression as we move towards that guidance.

Derrick Lee Whitfield: And.

Our capex.

Derrick Lee Whitfield: <unk>.

Derrick Lee Whitfield: We'll also hit our guidance that we're looking for Capex, obviously is related to our projects and construction projects in construction continue on time.

Derrick Lee Whitfield: Roger.

Derrick Lee Whitfield: While billings may be a little bit slower at the front end of a project accelerate as you get towards the completion.

Derrick Lee Whitfield: No.

Speaker Change: Long answer.

Speaker Change: To your question the short answer is yes.

Speaker Change: That's great and just to clarify one point on the sell four of your RIN exposure are you guys doing that out of an abundance of caution are you concerned that the EPA could affect the CWC to address the likely shortfall in rent generation right yes.

Derrick Lee Whitfield: And just to clarify one point on cell four of your rent exposure, are you guys doing that out of an abundance of caution, or are you concerned that the EPA could affect the CWC to address the likely shortfall in rent generation? Yeah, hey, Derrick. Adam Comora here.

Speaker Change: Hey, good morning, Derrick Adam Tomorrow here.

Adam J. Comora: No, I don't think we're going to see a cellulosic waiver credit in 2024. And, you know, we think that this is, we just feel like it is a way for us to de-risk and get better visibility over our EBITDA cash flows for the year. You know, I want to be a little careful because we are active in the market with our price forecast and that sort of thing. But, you know, we have sold forward a majority of our production, which makes complete sense. And John, for my follow up, perhaps.

Speaker Change: No I don't think were going to see a cellulosic waiver credit.

Speaker Change: In <unk> in 2024.

Speaker Change: And.

Speaker Change: We think that this.

Speaker Change: We just feel like it is.

Speaker Change: Yes.

Speaker Change: For us to de risk and get better visibility over our EBITDA and cash flows for the year.

Speaker Change: I want to be a little careful because we are active in the market.

Speaker Change: Our price forecast and that sort of thing but.

We have.

Speaker Change: All forward the majority of our production.

Speaker Change: Makes complete sense and John for my my follow up perhaps for you with respect to your pipeline of projects. I know you guys have moved away from disclosing the ADP.

John: With respect to your pipeline of projects, I know you guys have moved away from disclosing 80, but maybe could you offer some color on the depth of opportunities you're seeing in the market today, similar to the Cottonwood project you guys just, Yeah, sure. We see really great relationships and partnerships with all of our landfill partners, and they're continuing to deepen. I think that, you know, a particularly good example is our growing relationship with GFL on our Emerald and Sapphire projects. GFL is particularly forward thinking and collaborative, and we see a growing relationship there. But there are growing opportunities set across all of our relationships. We consider relationships to be one of our highest values.

John: But maybe could you offer some color on the depth of opportunities youre seeing in the market today similar to the Cottonwood project can you guys just announced.

John: Yes sure.

Speaker Change: We see really great.

Speaker Change: Our relationships and partnerships.

With all of our landfill partners and Theyre continuing to deepen I think.

Speaker Change: Particularly.

Speaker Change: A good example is our growing relationship with GFS.

Speaker Change: At our Emerald and Sapphire projects, GFS, particularly forward thinking and collaborative and we see growing relationship there, but there is a growing opportunity set across all of our relationships. We consider relationships. So we one of our highest values and it's really paying off by coming together with additional.

John: And it's really paying off by coming together with additional projects. In addition, our execution on our projects, where when we complete construction and bring a project online, that confidence that the project's going to work when we turn it on and ramp up over a reasonably projected timeframe, really gives us great confidence in what we're putting together. So as more and more opportunities come through, we see that continued progression in our development pipeline. Thanks, that's great, Keller.

Speaker Change: <unk> projects in addition.

Speaker Change: Our execution on our projects, where when we complete construction and bring a project online.

Speaker Change: That confidence that the project is going to work when we turn it on and ramp up.

Speaker Change: <unk>.

Speaker Change: A reasonable projected timeframe really gives us.

Speaker Change: Great confidence in what we're putting together, so as more and more opportunities come through.

Speaker Change: We see that continued progression in our development pipeline.

Speaker Change: Thanks, that's great color.

Matthew Robert Lovseth Blair: One moment for our next question, and our next question will be coming from Matthew Blair of TPH. Your line is open. Thank you and good morning.

Speaker Change: And one moment for our next question.

Speaker Change: And our next question will be coming from Matthew Blair of Tpa <unk>. Your line is open.

Matthew Robert Lovseth Blair: Thank you and good morning.

Matthew Robert Lovseth Blair: You have some big projects coming online later this year with Sapphire and Polk. Could you talk about what you've learned from previous startups that you can apply to make sure these projects are successful and start up on time? Sure. Hi Matthew.

Matthew Robert Lovseth Blair: You have some big projects coming online later this year with Sapphire in Coke could you talk about what you've learned from previous startups.

Matthew Robert Lovseth Blair: Can apply to make sure. These projects are successful start up on time.

John: Thank you for your question. Now that we have our ninth project entering operation, we really take lessons from each project that we put into construction and then into operation, and it really contributes to each of the next ones. The basic design that we use is a proven design and one that we've utilized from our start with the Pine Bed and Noble Road projects.

Matthew Robert Lovseth Blair: Sure Hi, Matthew Thank you for your question.

Matthew Robert Lovseth Blair: No.

Speaker Change: Now that we have our ninth project entering operations, we really take lessons from each project that we put into construction and then into operation and it really contributes to each of the next ones.

Speaker Change: Basic design that we use as a proven design and one that we've utilized from.

Speaker Change: Start with the pie embedded noble road projects straight.

Speaker Change: Straight through to the projects that we're putting into construction today, while the size may differ the basic design.

John: And so each time our team of Project Managers gets more experience, we take the lessons learned from each project and apply them to the next set of projects, which gives us greater and greater confidence in terms of those projects coming online and working as projected. We try to stay away from technologies that are not proven. And having this really solid design is something that, again, I'm just repeating myself, gives us that confidence. Sounds good!

Speaker Change: Is the same and so each time.

Speaker Change: Team of.

Speaker Change: Project managers gets more experience, we take the lessons learned from each project and apply it to the next set of projects, which gives us greater and greater confidence in terms of those projects coming online and working.

Speaker Change: Projected.

Speaker Change: Wow.

Speaker Change: <unk>.

Speaker Change: No.

Speaker Change: We try to stay away from technologies that.

Are not proven and.

Speaker Change: And having this really solid design is something.

Speaker Change: Again, I'm, just repeating myself it gives us that confidence method.

Speaker Change: Yes.

Matthew Robert Lovseth Blair: And then one thing that investors ask about is your build multiples on your upcoming projects. Are you willing to share the cost per project for some of these upcoming startups? I think at one point, you had listed Prince William at 53 million. Is that still a good number? And then are you willing to share the cost for Sapphire, Polk, and Cottonwood?

Speaker Change: Sounds good and then one thing that investors ask about as you build multiples on on your upcoming projects are you willing to share the costs for project for some of these upcoming startups I think at one point.

Speaker Change: You had listed principally in at $53 million is that still a good number and then are you willing to share the costs for Sapphire Polk.

Speaker Change: Thank you.

Adam J. Comora: Yeah, this is Adam Comora here. We're not going to get into specific cap costs per project. What I would tell you is, obviously, over the last several years, there has been some cost inflation that we think, you know, is not unique to Opal Fuels. And, despite that cost inflation over the last couple of years, we're still finding very attractive returns on capital projects. And I can tell you we're extraordinarily capital disciplined here at Opal Fuels. It's in all of our DNA.

Speaker Change: Yes. This is Adam <unk> here, we're not going to get into specific cap cost per project, what I would tell you is.

Adam Lewis: Obviously over the last several years there has been some cost inflation that.

Adam Lewis: That we think.

It's not unique to Opel fuels and.

Sure.

Adam Lewis: Despite that cost inflation over the last couple of years.

Adam Lewis: We're still finding very attractive return on capital projects and.

Matthew Robert Lovseth Blair: And we still are finding attractive unlevered IRR return projects. You know, and what I would say is, bill multiples are lower for larger projects. And, you know, if you do move down the curve of smaller projects, the bill multiples do, you know, lengthen out a little bit. But we are still finding really attractive returns on capital projects. Great, thank you.

Adam Lewis: I can tell you we're extraordinarily capital.

Adam Lewis: Disciplined here at Opal fuels, it's in all of our DNA.

Adam Lewis: And we still are finding attractive unlevered IRR.

Adam Lewis: <unk> projects.

Adam Lewis: And what I would say is build multiples are lower for larger projects.

Adam Lewis: And.

If you do move down the curve of smaller projects.

Adam Lewis: The build multiples do.

Adam Lewis: Lengthened out a little bit.

Adam Lewis: But we are still finding really attractive return on our capital projects.

Adam Lewis: Yes.

Speaker Change: Great. Thank you.

Martin Whittier Malloy: One moment for our next question, and our next question will be coming from Martin Malloy of Johnson Rice & Company. Your line is open. Good morning.

Speaker Change: One moment for our next question.

Speaker Change: And our next question will be coming from Martin Malloy of Johnson Rice <unk> Company. Your line is open.

Speaker Change: Okay.

Martin Whittier Malloy: Thank you for taking my question, question. I just wanted to ask. Relative to slide 18, any update in terms of customer adoption or testing of the 15 liter? Yeah, this is Adam Comora here again. Thanks for the question, Matt. The testing has gone very well for fleets.

Good morning, Thank you for taking my question.

Martin Whittier Malloy: First question I just wanted to ask.

Martin Whittier Malloy: Relative to slide 18, any update in terms of customer adoption or testing of the 15 liter engine.

Adam J. Comora: And, you know, we think it's a really attractive product financially for these fleets, where they can see really attractive returns on capital to deploy them, even if they were just running on CNG, regardless of the sustainability advantages from running on RNG. So, you know, no change to our outlook there. You know, I know I'm going to be asked at some point about regulatory policy and that sort of thing, which, you know, we think this is a very attractive product for fleets to adopt.

Martin Whittier Malloy: Yes. This is Adam <unk> here again, thanks for the question Matt.

The testing has gone very well for fleets and.

Adam Lewis: We think it's a really attractive product financially for these fleets, where they can see really attractive returns on capital to deploy them. Even if they were just running on <unk>, regardless of the sustainability advantages from running on our LNG.

Adam Lewis: No.

Adam Lewis: No change to our outlook there.

Adam J. Comora: And, you know, I know another company, a lot of folks have already reported and spoken about what the ramp could be for for this product in the market. And we sort of see it the same way.

Speaker Change: I know I am going to be asked at some point on regulatory policy and that sort of thing.

Speaker Change: Which.

Speaker Change: We think this is a very attractive product on.

Speaker Change: For fleets to adopt and.

Speaker Change: I know a lot of folks have already reported and spoken about whats the ramp could be for.

Speaker Change: For this product in the market.

Speaker Change: And we sort of see it the same way.

Speaker Change: And we.

Adam J. Comora: And, you know, we think there's a really large potential for it. Now, in our guidance and in our guidance for the year, we've never baked in a fast adoption curve here at 24, because, you know, the trucks really won't start showing up until 25. But nothing has changed in terms of, you know, sort of the feedback we've gotten and, you know, the interest levels that we're seeing, especially given where some of the electrification or hydrogen fuel cell, you know, sort of challenges are still there for this class eight heavy duty fleet.

Speaker Change: We think there's a really large potential for it now in our guidance and our guidance for the year.

Speaker Change: We've never baked in a fast adoption curve here in 'twenty four because the trucks really wont start showing up until 'twenty five but nothing has changed in terms of sort of the feedback we've gotten and the.

Speaker Change: The interest levels that we're seeing especially given.

Speaker Change: Where some of the electrification our hydrogen fuel cell.

Adam J. Comora: And, you know, I think it's starting to really prove out, and folks are starting to recognize that this is a really good answer for heavy-duty trucking. So, you know, I'll just leave it there. It's sort of no change to what we were thinking last time we spoke about it. Okay, and then for my follow-up. I wanted to ask you, as well, on slide 9. If you could talk maybe about the non-transportation demand and if you're seeing any interest from data center operators in terms of using RNG as a fuel for power. Yeah, so this is Adam Comora again.

The challenges are still there for this for this class eight heavy duty fleet and.

Speaker Change: I think it's starting to really proved out and folks are starting to recognize that this.

Speaker Change: It's a really good answer for heavy duty trucking and.

Speaker Change: So.

Speaker Change: I'll just leave it there.

Speaker Change: Sort of no change to what we were thinking last time, we spoke about it.

Speaker Change #100: Okay, and then for my follow up question.

Wanted to ask is relative to slide 19, if you could talk maybe about the non transportation demand and if youre seeing any interest from data center operators in terms of using R&D is.

Speaker Change #100: Fuel for power.

Adam J. Comora: I, you know, we are seeing increasing interest in the use of RNG in a variety of markets, whether it be SAF, whether it be hydrogen production, whether it be used for data centers. And look, I think everybody recognizes that there is, you know, more demand for RNG than, likely, supply. And a lot of these different markets are looking to it to decarbonize. And, you know, that sort of demand-supply imbalance naturally leads to prices going up in these in other sorts of markets.

Speaker Change #100: Yes. So this is Adam <unk> again.

We are seeing increasing interest for the use of R&D in a variety of markets, whether it be SaaS, whether it be hydrogen production.

Adam Lewis: It would be used for data centers and.

Adam Lewis: Look I think everybody recognizes that there is.

Adam Lewis: More demand for RMG, then likely supply and a lot of these different markets and looking to it to decarbonize.

Adam Lewis: And.

Adam Lewis: That sort of demand supply imbalance naturally leads to <unk>.

Adam Lewis: Prices going up in these any other sorts of markets.

Adam J. Comora: Now, we are still of the belief that the best value is in transportation fuel. We haven't seen yet where it makes sense for us to sell into those other voluntary markets. And we understand, you know, sort of the trade-offs there between voluntary markets and the renewable fuel standard. And, but that being said, we think, you know, sort of, at some point, that this may change, and we may start to see those prices move up to those levels that make sense.

Adam Lewis: Now we are still of the belief that the highest best value is in transportation fuel, we haven't seen yet where it makes sense for us to sell into those other voluntary market and we understand.

Adam Lewis: Sort of the tradeoff there between voluntary markets and the renewable fuel standard.

Adam Lewis: And.

Adam Lewis: But that being said we think.

Adam Lewis: Sort of.

At some point that that May change and we may start to see those prices move up to those levels that that makes sense and.

Adam J. Comora: And so we're keeping an eye on all those other markets; they continue to evolve and develop. And, I'll leave it there. We, you know, I know there's a lot of interest in SAF and hydrogen production from R&G, and we'll see how that evolves. Great, thank you. I'll turn it back. And our next question will be coming from Ryan Pfingst of B Riley. Your line is:

So we're keeping an eye on all those other markets they continue to evolve and develop.

Adam Lewis: And.

I'll leave it there.

Adam Lewis: I know, there's a lot of interest in SaaS and hydrogen production from <unk>, and we'll see how that evolves.

Speaker Change #101: Great. Thank you I'll turn it back.

Speaker Change #102: Thank you.

Speaker Change #102: And our next question will be coming from Ryan <unk> of B Riley. Your line is open.

Ryan James Pfingst: Hey, good morning, guys. And thanks for taking my questions. How are you guys thinking about M&A today? And maybe what are you seeing in the private market and how those valuations might compare to those of publicly traded companies? Hey, good morning, Ryan, John again.

Ryan John: Hey, good morning, guys and thanks for taking my questions.

Ryan John: How are you guys thinking about M&A today, and maybe what are you seeing.

Ryan John: In private markets now those valuations might compare to those.

Ryan John: Publicly traded company.

John: So, you know, obviously, there's a number of marks in the private market that continue to give us good confidence in the value of Opal Fuels and our vertically integrated business model. Private market transactions such as, you know, we talked about before, the Enbridge-Morrow really set a benchmark as to where those valuations lie and that, you know, we believe that there is... Whether we acquire somebody or somebody else acquires us, we continue to see that there are good opportunities and valuations in the market. That being said, we really continue to believe.

John: Hey, good morning, Ryan John again so.

Ryan John: Obviously, there is a number of marks in the private market that gives us continues to give us good confidence in the value of <unk> fuels in our vertically integrated business model.

Ryan John: Private market transactions, such as we've talked about before the Enbridge Mauro.

Ryan John: Really setting a mark as to where those valuations lie.

Ryan John: And.

Ryan John: We believe that there is.

Ryan John: A continuing desire on the part of market participants for gaining scale.

Ryan John: The industry is ripe for consolidation.

Ryan John: Scale is certainly important here.

Ryan John: In addition to just the landfill opportunities theres opportunities in adjacent markets as well.

Ryan John: <unk> are very close to what we're doing whether it's us.

Ryan John: Acquiring somebody or somebody else acquiring us we continue to see.

Ryan John: That theres, good opportunities and valuations in the market that being said, we really continue to believe.

John: Our organic growth model on vertical integration continues to be our core growth model and where we're going to be focusing. As we said earlier, we see a great set of opportunities on the development side with growing relationships. And there's a great amount of growth right in front of our noses just by executing the opportunities we have in front of us. Yeah, that makes sense. Thanks for that color.

Ryan John: Our organic growth model on vertical integration continues to be.

Ryan John: Our our core growth model, and where we're going to be focusing as we said earlier that we see.

Ryan John: Great.

Ryan John: Of opportunities on the development side with growing relationships.

Ryan John: And there's a great amount of growth right in front of our noses just on executing the opportunities we have in front of us.

Ryan James Pfingst: And maybe related, could you please provide us with any updated thoughts on how you guys are thinking about potentially solving for Opal's low float and maybe if M&A might be an avenue that you take there? Yeah, no, I think that's exactly right. And look, we, this is Adam here. We have tried to take some steps to address liquidity trading in the stock and that sort of thing. And, you know, we recently, or our majority control shareholder recently converted some super voting shares down into a new class share of class B.

Speaker Change #104: Got it makes sense. Thanks for that color and then maybe related could you provide us with.

Speaker Change #104: Any updated thoughts on how you guys are thinking about potentially solving for <unk>.

Speaker Change #104: Both love slowed and maybe M&A might be an avenue that you take care.

Speaker Change #104: Yes, no I think thats exactly right and look we this is Adam here, we have tried to.

Speaker Change #104: It takes some steps to address liquidity trading in the stock and that sort of thing and.

We recently are majority control shareholder recently converted.

Speaker Change #104: Some supervoting shares down into a new class share of class B and.

Ryan James Pfingst: And, you know, we think that that puts us in a position to be considered for index inclusion and that sort of thing. And, you know, maybe that potentially helps out trading liquidity in the stock as it pertains to float. I think M&A is an interesting avenue there. And, you know, we take a look at a lot of things. And, you know, as John mentioned, scale potentially makes sense.

Speaker Change #104: We think.

Speaker Change #104: That that.

Speaker Change #104: Puts us in a position to be considered for for indices inclusion in that sort of thing.

Speaker Change #104: <unk>.

Speaker Change #104: Maybe that potentially helps out trading liquidity in the stock as as it pertains to float I think M&A is an interesting Avenue there.

Speaker Change #104: <unk>.

Speaker Change #104: We take a look at a lot of thanks and.

As John had mentioned scale potentially make sense and.

Adam J. Comora: And, you know, M&A transactions could potentially make sense. And, you know, as our chairman likes to say, we like to find opportunities where one plus one equals three, or he actually likes to say one plus one equals five. So if we can find some opportunities where that makes sense, that certainly is a good way to increase our float. And so, but look, those kinds of things, you know, in terms of liquidity in the stock, they don't really drive the decisions here.

Speaker Change #104: M&A transactions could potentially make sense and as our chairman likes to say, we'd like to find opportunities, where one plus one equal three or he actually likes to say one plus one equals five.

Speaker Change #104: If we can find some opportunities.

Speaker Change #104: Where that makes sense.

Speaker Change #104: That certainly is a good way to increase our our float.

Speaker Change #104: And so but look those those kinds of things in terms of liquidity in the stock. They don't really drive the decisions here at <unk> at <unk> also really trying to maximize shareholder value in the long term and we believe we're doing that by building.

Adam J. Comora: At Opal, at Opal Fuels, we're really trying to maximize shareholder value over the long term, and we believe we're doing that by building, you know, a really powerful business and something that's going to generate a lot of free cash flow. Makes sense. Thanks for that detail. I'll turn it back. The next question will be coming from Paul Cheng of Scotiabank. Paul, your line is open. Oh, I'm sorry, you came off earlier, so I couldn't hear my name.

Speaker Change #104: Really powerful.

Speaker Change #104: Business and something that is going to generate a lot of free cash flow.

Speaker Change #105: Makes sense, thanks for that detail I'll turn it back.

Speaker Change #106: And one moment for our next question.

Speaker Change #106: Next question will be coming from Paul Cheng of.

Paul Cheng: Scotiabank Your line is open.

Paul Cheng: Paul Your line is open.

Oh I'm sorry.

Paul Cheng: <unk> come off of our DSI Couldnt name by name Hey.

Paul Cheng: Hey guys, good morning. Good morning, Paul. We're going to be OK? Good morning, Paul.

Hey, guys good morning.

Paul: Good morning, Paul Rooney, Okay.

Paul Cheng: Yeah, I think this is for Scott. I have to apologize that there's a little bit of detail modeling. When in the PIMS, PIMS winner, because before you get the certification, I assume that the gas is being stored in the storage. So when you report in the second quarter the RNG wallet for sales or production, will the production actually show up there? Or that you will essentially not be showing it, and then we have a big jump in the third quarter. Okay, Paul. This is John.

Paul: Yes.

Speaker Change #107: I think this is Scott I apologize that I think it would be off the detailed modeling.

When in the in the pens.

Speaker Change #107: Women because before you get the certification I assume that the gas is being stored in disposal. When you report in the second quarter.

Our NK one them for sales our proteins.

The production actually still up there.

Speaker Change #107: Or that you will essentially not showing it and then we have a big jump in that quarter.

John: I'll go through it in just a little bit of detail, and then I'll talk more in general. But in essence, when we produce gas at our projects in a given month, we'll dispense that gas, essentially matching the gas production with our dispensing capacity on the downstream side to create those RIN credits. Those RIN credits will be available for sale after minting the following month.

Okay. Paul This is John I'll go through just a little bit of detail and then ill talk more in general but.

John: In essence, when we produce gas.

John: Our projects in a given month will dispense that gas.

Paul: Essentially matching the gas production with our dispensing capacity on the downstream side to create those RIN credits.

Paul: Those RIN credits will be available for sale after maintaining the following month so production in.

John: So production in April will be minted in May, and those credits will be available for sale in the May period. With respect to new projects, and especially with the new BRRR rules, we expect that our Prince William project will be grandfathered under the prior rules that, yes, the gas will be stored. And that when we get that approval for Q-RIMS, which will take, you know, anywhere from a couple of weeks to, you know, six or so weeks, depending on the EPA's bandwidth, we'll then be able to dispense that gas.

Paul: April will be minted in may and those credits available for sale in the May period, with respect to new projects and especially with the new.

Paul: B our rules.

Paul: We expect.

Paul: Our Prince William project will be grandfathered under the prior rules.

Paul: <unk>.

Speaker Change #108: Yes, the gas will be stored in that when we get that approved.

Speaker Change #108: Approval for Q rents, which will take.

Anywhere from a couple of weeks to.

Speaker Change #108: Six or so weeks, depending on the Epa's bandwidth that will then be able to dispense that gas. So if we dispense Prince William gas in June that gas will show up as minted credits in July.

John: So if we dispense Prince William gas in June, that gas will show up as minted credits in July when we'll be able to sell them. As new projects come online, like Sapphire in the third quarter and Pulk in the fourth, yeah, the new rules will likely cause us to lose the first months or partial months' worth of production based on how they're qualifying projects. But the basic timing is the same.

Speaker Change #108: We will be able to sell them.

Speaker Change #108: As new projects come online like Sapphire in the third quarter and pulp in the fourth.

Speaker Change #108: The new rules will likely cause.

Speaker Change #108: US to lose the first months.

Speaker Change #108: Partial months worth of.

Speaker Change #108: Production.

Speaker Change #108: Based on how they are qualifying projects.

Speaker Change #109: But the basic timing is the same I don't know Adam Yes, I just wanted to clarify one thing that John said there. So you will see all the production produced at Prince William Paul can Sapphire in the months that they produce as John was saying for Prince William.

Adam J. Comora: I don't know, Adam. Yeah, no, I just want to clarify one thing that John said there. So you will see all the production produced at Prince William, Polk and Sapphire in the months that they produce. As John was saying for Prince William, it will, it has been, you know, our EPA certification is in, so we will get the RIN value on all of that gas produced in, you know, once we do get the final certification there for Polk and Sapphire, excuse me, yeah, for Polk and Sapphire, we will have the production of that gas for the first, you know, whatever it is, two, four, six weeks, we'll just get the brown value of that fossil gas.

It will.

Adam Lewis: It has been our EPA certification is in so we will.

Adam Lewis: Get the RIN value on all of that gas produced in.

Adam Lewis: Once we do get the final certification there.

Adam J. Comora: So all of that gas is included in our production guidance. It's just a question of how long, you know, for those next couple of projects, will we just get the brown value versus getting the RIN certification for it? Does that make sense? Absolutely. Thank you. And Adam or John, do you have a cadence for Prince William where I'm not going to look like for the remainder of the year?

Speaker Change #110: For bulk and SaaS fire excuse for.

Paul can sapphire, we will have the production of that gas for the first whatever it is 246 weeks.

Speaker Change #110: We'll just get the brown value of that fossil gas. So all of that GAAP is included in our production guidance.

Speaker Change #110: It's just a question of how long for those next couple of projects, where we just get the brown value versus getting the RIN certification of it.

Speaker Change #111: Okay that makes sense.

Speaker Change #112: Yes, absolutely. Thank you.

Speaker Change #113: And Adam what's wrong.

Adam Lewis: Can you have attained 10.

Speaker Change #114: Payments win.

We're not going to look like.

Speaker Change #114: For the remainder of the year.

Paul Cheng: Well, I'm sorry, I didn't get the Prince William ramp up. Yeah, so look, project design, great project design proven. We think that the ramp up will be very good. The commissioning went very smoothly.

Adam Lewis: I'm, sorry, I didn't get the Prince William ramp up yes.

Adam Lewis: Look.

Adam Lewis: Project design, Great project design proven we think that the ramp up will be very good the commissioning went very smoothly.

And.

Adam Lewis: You kind of see the ramp up in real time, but because of the proven design, we really expect that.

Adam Lewis: The lessons learned from prior projects will be applied to this one and we should see a good progression.

John: And, you know, you kind of see the ramp up in real time. But because of the proven design, we really expect that Adam, would you like to add to that? Yeah, no, the only thing I would say there too is, and I'm not sure if we'll get questions on it in terms of capacity utilization and that sort of thing. But just keep in mind that we do build these facilities to where we expect them to mature and grow into.

Adam Lewis: Adam did you want to add to that yes. The only thing I would say they are to us.

Adam Lewis: I'm not sure if we'll all get questions on it in terms of.

Adam Lewis: Capacity utilization in that sort of thing, but just keep in mind that we do build these facilities to where we expect them to mature and grow into when you look at our inlet.

John: When you look at our inlet gas capacity, you know, we do expect these facilities to grow over time, and we do see good growth on a same store sale basis. So, but everything looks good at Prince William so far.

Adam Lewis: Gas.

Adam Lewis: Capacity.

Adam Lewis: So.

Adam Lewis: We do expect these facilities to grow over time, and we do see good growth on a same store sale basis same store sales.

Adam Lewis: <unk>.

Adam Lewis: Basis, so, but everything looks good at Prince William So far large opening growing landfills projects built.

Adam J. Comora: Yeah, large open and growing landfills, projects built to take advantage of that growth, and a proven design, all of which really contribute to that growth. Which really speaks to why we're confident in terms of, you know, reiterating our guidance and that sort of thing. Prince William was the chunkiest piece of production growth this year. And it was good that we completed that and are injecting gas into the pipeline. So we assume Pinswinner will get to about 80% possible.

Adam Lewis: Get to take advantage of that growth in.

Adam Lewis: And our proven design.

Adam Lewis: All of which really contribute to that growth. So that's really what it really speaks to why we're confident in terms of reiterating our guidance and that sort of thing is principally was the chunky piece of production growth this year.

Adam Lewis: And it was good that we completed that in our objected gas into the pipeline.

Adam Lewis: So we assume since when we get to about 80% plus.

Paul Cheng: We're not going to get into specifics on any one facility. Paul, what we do is we try and give, because we do have a portfolio of projects, where we expect our overall inlet capacity utilization and utilization of inlet gas. We try and give more portfolio-level guidance versus just individual facilities. Okay, we'll do that. Thank you.

Adam Lewis: We're not going to give any specifics on any one facility.

Speaker Change #115: Paul what we do is we try and give because we do have a portfolio of projects.

Speaker Change #115: Where we expect.

Speaker Change #115: Our overall inlet capacity utilization.

Speaker Change #115: Utilization of inlet gas, we try and give.

Speaker Change #115: A more portfolio level guidance versus just individual facilities.

Paul: Okay. Thank you.

Alex Kania: In one moment for our next question. Our next question will be coming from Alex Kania of Marathon Capital. Your line is open. Hey, good morning.

Speaker Change #116: And one moment for our next question.

Speaker Change #116: Our next question will be coming from Alex Kania of Marathon capital. Your line is open.

Alex Kania: Hey, good morning.

Alex Kania: So two questions, hopefully. The first one is just, you know, you express some cautious optimism about getting ITC clarity. I'm wondering if you think that there's a timetable associated with that and then, you know, the coming months or quarters or what or whatnot. And the second one is just with respect to the, you know, rent forward sales; was that limited to just 2024? Or, you know, do you have any, were you able to sell forward any, you know, kind of future exposure? Okay, so thank you for the question. And I'm going to answer the second one first because that's quick.

Alex Kania: So two questions hopefully the first one is just any.

Alex Kania: You expressed some cautious optimism on getting ITC clarity I'm. Just wondering if you think that there is a timetable associated with that in the coming months or quarters or whatnot.

Alex Kania: And the second one is just with respect to the RIN forward sales was that limited to just 2024 or do you have any where you're able to sell for it any kind of future exposure into 'twenty and beyond.

Adam J. Comora: You know, there is a 2025 market starting to develop, but it's very thin. We have not transacted yet on 2025. I don't know if that'll show up until later in the year.

Speaker Change #117: So I. Thank you for the question and.

Speaker Change #118: I'm going to answer the second one first because that's quick.

Speaker Change #118: There is a 2025 market starting to develop but its very fine and we have not transacted, yet 25, I don't I don't know if that will show up until later in the year.

Speaker Change #118: And before I get into the specifics on the ITC.

Speaker Change #118: To talk a little more broadly on a regulatory outlook, because we do get a lot of questions on a potential Republican administration.

Adam J. Comora: And before I get into the specifics on the ITC, I want to talk a little more broadly on our regulatory outlook, because we do get a lot of questions on a potential Republic administration. And, you know, what I want to say is a couple of things about that. First, I want to remind everybody the problem that we solve, which is fugitive methane emissions from, you know, waste in place, whether it's from landfills or manure or wastewater or food waste.

Speaker Change #118: <unk>.

What I want to say is a couple of things on that first I want to remind everybody of the problem that we solve which is fugitive methane emissions from.

Speaker Change #118: Waste in place, whether it's from landfills or manure wastewater food waste.

Speaker Change #118: <unk>.

Speaker Change #118: That that molecule waste in place issue was starting to get a lot more attention.

Speaker Change #118: <unk>.

Speaker Change #118: Opel has a view that really what we should be doing as a better best.

Speaker Change #118: Strategy around that.

Speaker Change #118: The wrong answers to do nothing and.

Speaker Change #118: Yes.

Speaker Change #118: Rather than doing nothing you can also capture these fugitive methane emissions at their source and flare, which also is not a great answer and we really believe that what we should be doing is this better best policy, which is which is converting them into either renewable power or RMG.

Adam J. Comora: And, you know, that molecule waste in place issue is starting to get a lot more attention. And we really believe that what we should be doing is this better, best policy, which is converting it into either renewable power or RNG. And I also want to say we don't need any new policies or regulations to execute on our growth plans. And what we're really talking about here is what we can do to accelerate our business, which is more biomethane capture for productive use, which is really what, you know, the vast majority of Americans want to fight climate change and also public policymakers. And where it sort of breaks down, and I'm getting to the ITC specifically in a minute, but where it breaks down at times is that you get into a debate between molecules versus electrons.

Speaker Change #118: I also want to say, we don't need any new policies or regulations to execute on our growth plans and what we're really talking about here is what we can do to accelerate our business, which is more biomethane capture for productive use.

Speaker Change #118: Is really what.

Speaker Change #118: The vast majority of Americans want to fight climate change and also public policymakers and.

Speaker Change #118: Where it sort of breaks down and I'm getting to the ITC, specifically in a minute, but where it breaks down at times is you get into a debate between molecules versus electronics and it shows up all over our business where.

Speaker Change #118: You have some very progressive climate folks that are really.

Speaker Change #118: Want to electrify everything and feel like all molecules are bad and you see that play out as people are contemplating what to do about heavy duty fleets, whether you electrify everything.

Adam J. Comora: And, you know, don't really embrace any molecules and really aren't acknowledging that we have a molecule in place issue from all this waste that these fugitive methane, you know, sort of emissions come from. And then, you know, we've got folks on the perhaps the Republican side, which, by the way, are in favor of all sorts, you know, or we believe, you know, maybe we'll remove some of the blockages on molecules.

Speaker Change #118: And.

Speaker Change #118: Don't really embrace.

Speaker Change #118: Embrace any molecules and and really arent acknowledging that we have a molecule in place issue from all this waste.

Speaker Change #118: These fugitive methane emissions.

Speaker Change #118: Emissions come from.

Speaker Change #118: Then we've got folks on the.

Speaker Change #118: Perhaps the Republican side, which by the way are in favor of all sorts.

Speaker Change #118: We believe maybe will remove some of the blockages.

Adam J. Comora: And it shows up, you know, when people are talking about, you know, how to use RNG in either hydrogen production or sap production or what to do about heavy-duty trucking. And, you know, we really believe there's an opportunity here to sort of, you know, get this, you know, get, you know, both sides of the aisle to really embrace this better, best strategy. You know, there was an initial fix done where biogas property would be included.

Speaker Change #118: Molecule solutions and it shows up when people are talking about how to use RMG in either hydrogen production of SaaS production or what to do about about heavy duty trucking.

And.

Speaker Change #118: We really believe there is an opportunity here.

Speaker Change #118: To sort of.

Speaker Change #118: Get this get both sides of the aisle to really embrace.

Speaker Change #118: This better best strategy and.

Speaker Change #118: As it pertains to the ITC.

Speaker Change #118: <unk>.

Speaker Change #118: There was an initial fixed done where biogas property would be included there is a couple of mechanical things that that I think industry has been asking for specifically on landfills on common ownership because we.

Adam J. Comora: There's a couple of mechanical things that I think the industry has been asking for, specifically on landfills, on common ownership, because we, you know, landfill owners typically own the collection system, and all the capital that's being invested, or the vast majority of the time, capital being invested, does not own the collection system. And, you know, we're still optimistic that that could potentially be fixed, and, you know, early summer is when we've been told we're going to hear on it. If that common ownership doesn't get fixed, there may be ways to structure around it.

Speaker Change #118: Landfill owners typically on the collection system and all the capital that's being invested or the vast majority of time capital invested.

Speaker Change #118: <unk> does not own the collection system and we're still we're still optimistic that that could potentially be fixed.

Speaker Change #118: And early summer as we've been told we're going to hear on it if that common ownership doesn't get fixed there may be ways to structure around it.

Adam J. Comora: So, we're still cautiously optimistic that, you know, we will be able to utilize or qualify for those tax credits, but it's not totally done yet. And when we think about what we were talking about before, ways to turn this into a bipartisan issue and really accelerate, you know, sort of what we're doing and this fight against climate change, you can see it playing out in a number of different ways where, you know, if Biden wins the election, chances are you'll get some of those more positive public policies, whether it be E-RINs or something else.

Speaker Change #118: So we're still cautiously optimistic that.

Speaker Change #118: We will be able to utilize or qualify offer those tax credits but.

Speaker Change #118: It's not it's not totally done yet and.

Speaker Change #118: When we think about what we were talking about before ways to turn this into a bipartisan issue and really accelerate sort of what we're doing and this fight against climate change you can see it playing out in a number of different ways, where <unk> wins the election.

Speaker Change #118: Chances are you get some of those more positive public policies, whether it be E <unk> or something else.

Adam J. Comora: And, you know, if there is a Republican administration, maybe we will get more, what I would say, practical solutions around heavy-duty trucking, and maybe that will have positive implications for, you know, the Cummins 15-liter engine or, you know, more practical solutions on how to use RNG for renewable hydrogen. And by the way, even if we wanted to create renewable electricity from it, it makes more sense to take that RNG and bring it over to an efficient combined cycle plant. And, you know, by the way, RNG is the best answer for environmental justice. You know, it does the most to improve local air quality and that sort of thing.

Speaker Change #118: And.

Speaker Change #118: If there is a Republican administration, maybe we get more.

What I would say practical solutions around heavy duty trucking and maybe that has positive implications for.

Speaker Change #118: Yes.

Speaker Change #118: The <unk> 15 liter engine.

Speaker Change #118: Or more practical solutions on how to use RMG for renewable hydrogen and.

Speaker Change #118: Perhaps more embraced for making sure that we don't have issues that show up into the ITC.

Speaker Change #118: And.

Speaker Change #118: We think theres, a real opportunity there and.

Speaker Change #118: It's just really interesting that when we talked to folks on the Democratic side were trying to explain to them that we have a molecule in place issue and we need things like the ITC and biogas conditioning and property and by the way even if we wanted to create renewable electricity from it it makes more sense to take that orange.

Speaker Change #118: And bring it over to an efficient combined cycle plant and by the way R&D is the best answer for environmental Justice.

Adam J. Comora: And typically, Republican, you know, it typically shows up in Republican sectors, whether it be agriculture or, you know, all the countless municipalities out there. And, you know, from the electron side of things, we think there are a lot of Republicans that can get on board for more renewable power capture and production from this biomethane. You know, it's good base load power. It enhances grid stability.

Speaker Change #118: Does the most to improve local air quality and that sort of thing and typically Republican typically shows up in Republican kind of sectors, whether it be AG or all the countless municipalities out there.

Speaker Change #118: <unk>.

Speaker Change #118: From the from the Elektron side of things, we think Theres a lot of Republicans that can get onboard for for more renewable power.

Speaker Change #118: Capture and production from this biomethane, it's good baseload power it enhances grid stability its energy security and it usually shows up in more rural economy. So.

Adam J. Comora: It's energy security, and it usually shows up in more rural economies. So, you know, I know you specifically asked about the ITC. But, you know, I just wanted to explain a little bit more because we do get a lot of questions on the Trump administration. And I'd remind everybody, we don't need any of these policies to execute on our business plan and really grow, you know, in ways that we've been talking about. We just think there's a real opportunity here to accelerate what we're doing and, quite frankly, accelerate our fight against climate change. Great, thanks so much for that answer.

Speaker Change #118: I know you specifically asked about the ITC.

Speaker Change #118: But.

Speaker Change #118: I just wanted to explain a little bit more because we do get a lot of questions on on a Trump administration and I'd remind everybody. We don't need any of these policies to execute on our business plan to really grow.

Speaker Change #118: In ways that we've been talking about we just think there's a real opportunity here to accelerate what we're doing and quite frankly accelerate our fight against climate change.

Great. Thanks, so much for that answer.

One moment for our next question.

Alex Kania: One moment for our next question. Our next question will be coming from Adam Bubes of Goldman Sachs. Adam, your line is, Hi, thanks for taking my question.

Speaker Change #118: Our next question will be coming from Adam Lewis.

Adam Lewis: Goldman Sachs. Your line is open.

Adam Lewis: Adam Your line is open.

Adam Samuel Bubes: In fuel station services, I was just wondering how many incremental owned and third-party stations you expect to complete in 2024 to hit the 75 to 90 percent EBITDA growth outlook and how you're thinking about the cadence of fuel station builds throughout the year? Adam, we do not typically give quarterly guidance in terms of to that level of granularity. We can get back to you in terms of the number of stations that'll come online.

Adam Lewis: Hi, Thanks for taking my questions.

In fuel station services, just wondering how many incremental owned and third party stations do you expect to complete in 2024 to hit that 75% to 90%.

Adam Lewis: EBITDA growth outlook, and how youre thinking about the cadence of fuel station builds throughout the year.

Speaker Change #119: Adam we do not typically give quarterly guidance in terms of to.

Adam Lewis: To that level of granularity, we can get back to you in terms of.

Adam Lewis: Sort of a number of stations that will come online I think the first quarter of this year had seven incremental <unk> fuel owned stations versus last year.

Adam J. Comora: I think the first quarter of this year had seven incremental Opal Fuel-owned stations versus last year. And I would say Opal Fuel Station services revenue and EBITDA growth comes from four different places, right? It's better utilization of our dispensing network, so we believe we're going to have more environmental credit revenue flowing through those sites. It also comes from improving margins in the construction business, where last year we were still cycling through some inflation issues.

Adam J. Comora: It does come from higher volumes from new stations being commissioned and also as you annualize last year's stations where you had partial years. And we still have growing volumes in the service side of the business. So it really comes from all four of those things.

Adam Lewis: And I would say overall fuel station services revenue and EBITDA growth comes from four different places right, it's better utilization of our dispensing network. So we believe we're going to have more.

Adam Lewis: Sort of environmental credit revenue flowing through those sites. It also comes from improving margins in the construction business, where last year, we were still cycling through some inflation issues. It does come from higher volumes from from new stations being commissioned and also as you annualize last year.

Patients, where you had partial years and we still have.

Adam Lewis: Growing volumes in the service side of the business. So it really comes from all four of those things.

Adam J. Comora: And you know, as we look further out, that's also where we get excited about the growth of that potential 15 liter Cummins engine as we move through 25 and 26. But this year, you know, the 24, revenue and EBITDA growth really come from the four pieces I was talking about. Got it. Thanks a lot.

Adam Lewis: And.

Adam Lewis: As you look further out that's where also where we get excited about the growth of that potential 15 liter Cummins engine as we move through 'twenty five 'twenty six but this year the 24.

Adam Lewis: Both revenue and EBITDA growth really comes from the four pieces I was talking about.

Adam Samuel Bubes: And then any update on the two dairy projects, if there's been any resolution with the EPC contractors? And then, broadly, just can you update us on how you're thinking strategically about opportunities for dairy investments down the road? Sure, this is John.

Speaker Change #120: Got it thanks, a lot and then any update on the two dairy projects if theres been any resolution with the EPC contractors and then broadly just can you update us on how you're thinking strategically about opportunities for <unk>.

Speaker Change #120: Gary investments down the road.

John: I'll give you an update. On our California dairy projects, there really is no update. Just as a reminder, there is a dispute with the EPC construction contractor regarding some change orders. The contractor is obligated under the EPC contract to continue working while the dispute is resolved.

John: Sure. This is John.

John: Ill give you an update on on our California dairy projects. There really is no update just as a reminder, there is a dispute with the EPC construction contractor regarding some change orders.

John: We're proceeding with arbitration, which is continuing in due course, and the construction contractor's obligations are supported by a surety bond. So, it's in the process. As we think about growth, let's just reiterate that... Landfill R&G is a terrific opportunity, and there's a lot of room for growth there. So, as we think about our organic growth and the core growth that we're going to be experiencing, that's really going to come from our deepening relationships and joint ventures with our partners in the landfill sector.

John: The contractors obligated under the EPC contract to continue working.

John: While the dispute is resolved.

John: Proceeding with arbitration.

John: Which is continuing in due course.

John: The construction contractors obligations are supported by a surety bond so.

It's in process as we think about growth.

Ill just reiterate that.

John: Landfill RMG is a terrific opportunity and there's a lot of space for growth in there. So as we think about our organic growth in the core growth that we're going to be experiencing that's really going to come from.

John: Our deepening relationships and joint ventures with our partners in the landfill sector. However, we continue to explore other areas outside of landfill. So landfill will be the core of our growth foot. There's there's numerous biomethane opportunities adjacent to the <unk>.

John: However, we continue to explore other areas outside of landfill. So, the landfill will be the core of our growth, but, you know, there are numerous biomethane opportunities adjacent to the landfill sector. And in addition to dairy, we see opportunities in other agricultural waste, waste water itself, food waste, and other D3 and D5 gas streams.

John: Infill sector.

In addition to dairy we see.

John: Opportunities in other agricultural waste.

John: Wastewater itself food.

John: <unk> waste and other <unk>, three and <unk> five gas stream so.

John: So, continue to explore opportunities for expanding; we believe that there is a really large opportunity set outside of landfill and dairy, and we think that over the course of the coming year, we'll be able to recognize some entry into those areas as we start growing beyond the landfill. And then, last one for me, you know, congratulations on placing the Cottonwood project into construction. Just wondering if you can tell us more about that partnership in terms of royalty, CapEx, you know; any further details would be great. Yeah, no, thanks, Adam. This is Adam here.

John: We continue to explore opportunities of expanding we believe that there is a really large opportunities.

John: Outside of landfill and dairy.

We think that over the course of the coming year, we will be able to recognize some.

John: Entre into those areas as we start growing beyond the <unk> area.

John: And then last one for me congrats on placing the Cottonwood project into construction just wondering if you can tell us more about that partnership in terms of.

John: Royalty capex.

Any any further details would be great.

Adam J. Comora: You know, royalties in line with our historical averages, the CapEx in line with our, you know, most recent experience with the last, I don't know, three, four projects, or two or three projects that we put into construction. And, you know, we had already previously 8K'd that. So, you know, you can see who the landfill partner is, where we still have a couple more gas rights there than we had in an RFP, and we can look to continue to deepen that relationship.

Yes no.

John: Thanks, Adam this is Adam here royalty.

Adam Lewis: Royalties in line with our historical averages.

Adam Lewis: Capex in line with our with our.

Adam Lewis: Most recent experience of glass I don't know three or four projects are too.

Adam Lewis: Two or three projects that we put into construction and.

Adam Lewis: We had already previously 8-K that so.

Adam Lewis: You can see that the landfill partner is.

Adam Lewis: We still have a couple of more gas rights. There that we had won in an RFP.

Adam J. Comora: And, you know, it's actually a testament to the experience of the team here at Opal Fuels, where that was a little bit of a development challenge to solve a pipeline issue there, which we were really happy that we were able to do. And, you know, I think it's when Opal executes on those types of projects that we gain confidence, you know, with our various partners out there.

Adam Lewis: <unk>.

Adam Lewis: Look to continue to deepen that relationship and.

Adam Lewis: It's actually I would also really testament to the experience of the team here at <unk> fuels, where.

Adam Lewis: That.

Adam Lewis: It was a little bit of a development challenge to solve a pipeline issue there, which we were really happy that we were able to do and.

Adam Lewis: I think I think its when <unk> executes on those types of projects that we gain confidence.

Adam J. Comora: And, you know, we see it being completed in a typical timeframe, and, you know, excited about that one and excited about, you know, what else we're finding out there for the balance of the year in new projects. Great, congratulations to the team.

Adam Lewis: With our various partners out there and.

Adam Lewis: We see it being completed in a typical timeframe and.

Excited about that one and excited about.

Speaker Change #121: What else.

Speaker Change #121: We're finding out there for the balance of the year of new projects.

Speaker Change #123: Congrats to the team thank you.

Jimmy Larkin: Thank you. One moment for our next question. Our next question will come from Jimmy Larkin of Piper Sandler. Hi, good morning.

Speaker Change #122: One moment for our next question.

Speaker Change #122: Our next question will come from Jimmy <unk> of Piper Sandler Your line is open.

Hi, good morning, Thanks for taking my question.

Jimmy Larkin: I guess just on the dispensing side, could you maybe talk about what your CI mix is currently and kind of where you expect that to go in the future and, I guess, how that might impact? Yeah, no. I appreciate the question. So it's, it's a two-part question. The vast majority of Opal Fuels' production is landfill gas, and that can be anywhere from, you know, sort of 40 to mid-50s or 45 to 60 for a CI score.

Jimmy: I guess just on the dispensing side could you maybe talk about what your <unk> is currently.

Jimmy: And kind of where you expect that to go in the future and I guess, how that might impact how you place your landfill gallons going forward.

Adam J. Comora: And we do just that, and we also obviously have our Sonoma project, which is significantly negative CI, John, negative 238, somewhere in that range, 283, 330, excuse me, 330. And we also do dispense third-party gas, specifically at our California sites; we have a very large dispensing network in California. And we do partner with third-party dairy suppliers to dispense their, you know, significantly negative CI through that, through that portfolio of dispensing stations. So I don't have the exact math if you blend the two, between what we're dispensing outside of California and what we're dispensing inside of California.

Yeah No I appreciate the question so.

Speaker Change #124: Two part question the vast majority of all fuels as production is landfill gas and that can be anywhere from sort of 40 to mid fifties or 45 to 60 for a ci score.

Speaker Change #124: And.

Speaker Change #124: We do.

Speaker Change #125: And we also obviously have our Sonoma project, which is significantly negative Ci John.

Speaker Change #125: Negative 238 somewhere in that range to 83, <unk> hundred 30, excuse me $3 30.

Speaker Change #125: And we also do dispense third party gas specifically at our California sites, we have a very large dispensing network in California.

And we.

Speaker Change #125: We do partner with third party <unk> suppliers to dispense their us.

Speaker Change #125: Significantly negative ci through that through that portfolio of dispensing stations.

Adam J. Comora: But we actually do think there's a good opportunity for us to continue to add low CI supplies through our California dispensing network. And through that, Matt, through that, we participate in the LCFS market really through that broad participation in the low CI third-party gas. And by the way, that shows up in our fuel station service segment, in our environmental credit revenues piece, where as we continue to place more dairy gas, either from Opal or other third-party suppliers through our California dispensing network, you'll see growth in that revenue segment for that business unit. Thank you. I guess just one more.

Speaker Change #125: No.

Speaker Change #125: Don't have the exact math if you blend the two.

Speaker Change #125: Between what we're dispensing outside of California, what we're dispensing inside of California.

Speaker Change #125: But we actually do think theres, a good opportunity for us to continue to add low Ci supplies through our California dispensing network.

Speaker Change #125: Through that math through that we participate in the <unk>.

Speaker Change #125: Market really through that broad participation in the low Ci third party gas.

Speaker Change #125: And by the way that shows up in our in our fuel station service segment in our environmental credit revenues piece, whereas we continue to.

Speaker Change #125: Place more dairy gas either from <unk> or other third party suppliers through our California dispensing network.

Speaker Change #125: Youll see growth in that.

Speaker Change #125: Revenue segment for that business unit.

Speaker Change #126: Got it. Thank you I guess just one more.

Speaker Change #127: In the presentation deck, you mentioned a few times is there any updates maybe on the potential for egress coming back or have you guys heard anything on that front.

Jimmy Larkin: In the presentation deck, you mentioned eRent a few times. Are there any updates maybe on the potential for eRent going back? Or have you guys, you know, heard any?

Adam J. Comora: Yeah, so this is Adam again here. And, you know, as I was chatting about before, um, you know, we are, you know, at some point, we believe e-rins will get included in the RSS. And the question is, when? And, you know, we have the belief that we may be able to get bipartisan support for it. We're, you know, it's pretty clear that the, you know, Biden administration has been really supportive of inserting it into the program.

Speaker Change #127: Yes. So this is this is Adam again here and.

Adam Lewis: As I was chatting about before.

Adam Lewis: We are.

Adam Lewis: At some at some point, we believe E. Rins will get included into the RFS and the question is when and.

Adam Lewis: We have the.

Adam Lewis: The belief that we may be able to get bipartisan support for it.

Adam Lewis: <unk>.

Adam Lewis: It's pretty clear that the.

Biden administration has been really supportive of inserting them into the program.

Adam J. Comora: And we think it makes a lot of sense for a lot of the Republican constituents out there as well. And there are a variety of reasons for that, where, you know, if you look at the areas or sectors of the economy that benefit from it, a lot of them, you know, are in Republican-leaning areas.

Adam Lewis: And we think it makes a lot of sense for a lot of the Republican constituents out there as well.

Adam Lewis: And Theres a variety of reasons for that were.

Adam Lewis: If you look at the areas or sectors of the economy that benefit from it a lot of them.

Adam Lewis: Our in Republican kind of areas and.

Adam Lewis: We don't believe it's a zero sum game with corn or soy or other agricultural liquid biofuels that it really doesn't have any impact on the markets that they participate that for their for the rins that they potentially produce.

Adam Lewis: And.

We'll see how how effective will be on our in our education and advocacy around it for how quickly. It can be adopted I would say it is impactful for us not only on our existing portfolio, but quite frankly on a lot of development opportunities.

Adam Lewis: And.

Adam Lewis: And we think it's we think it's the right public policy so.

Adam Lewis: I can't give you an exact timeframe when.

Adam Lewis: But.

Adam Lewis: We think there is an opportunity to maybe talk about it this summer with EPA and see if we can get Republicans onboard so it wouldn't necessarily be repealed.

And.

Okay.

Adam Lewis: Now if it is to win.

Adam Lewis: Then.

Adam Lewis: We'd obviously remain in place.

Adam Lewis: And.

Adam Lewis: That's where I was sort of talking about before where.

Adam J. Comora: And, you know, we don't believe it's a zero sum game with corn or soy or other agricultural liquid biofuels that it really doesn't have any impact on the markets that they participate in for their for the rins that they, you know, potentially produce. And, you know, we'll see how effective we are in our education and advocacy around it for how quickly it could be adopted. I would say it is impactful for us not only on our existing portfolio but, quite frankly, on a lot of development opportunities.

Adam Lewis: And just like.

Adam J. Comora: And, and we think it's the right public policy. So I can't give you an exact timeframe when it will happen, but, you know, we think there's an opportunity to maybe talk about it this summer with EPA and see if we can get Republicans on board. So it wouldn't necessarily be repealed.

Adam J. Comora: And, you know, if Biden happens to win, you know, then, you know, it obviously will remain in place. And, you know, that's what I was sort of talking about before where, you know, we just like that particular issue where errands isn't zero sum for corn and soy. You know, we don't think, you know, the political outlook is zero sum for opal fuel because there are certain areas where the Republican administration is maybe, you know, more forward, you know, or, or, or, you know, on the molecule side of things. So anyway, it's something that we're still focused on. And, you know, we'll see how quickly they get adopted.

Adam Lewis: That particular issue you're in zero, some FERC for corn and soy.

Adam Lewis: We don't think the political outlook as zero sum for Opel fuel is because there are certain areas, where Republican administration maybe.

It is more forward.

Adam Lewis: Or.

Adam Lewis: On the molecule side of things so anyway, yes, it's something that we're still focused on end.

Adam Lewis: We'll see.

Adam Lewis: How quickly they get adopted.

Jimmy Larkin: Great, thanks for answering my questions; I'll turn it back. And our last question will be coming from Paul Cheng of Scotiabank. Your line is open.

Speaker Change #128: Great. Thanks for answering my questions I will turn it back.

Speaker Change #128: Okay.

Speaker Change #129: Thank you Andrew.

Speaker Change #129: Our last question will be coming from Paul Cheng of Scotiabank. Your line is open Paul.

Paul Cheng: Thank you. Hey, gentlemen, a real quick one. The utilization of inlet gas is 81%, which dropped 5% from the year ago level. Is there any particular reason contributing to that? Thank you. Yeah, Paul, I was waiting for that one.

Paul Cheng: Alright, thank you.

Paul Cheng: Gentlemen.

Paul Cheng: Quick one.

Paul Cheng: Amortization.

Paul Cheng: With 81%, 5% overlap with.

Paul Cheng: And that particular lease contract anything does that thank you.

Adam J. Comora: And, you know, what I want to first just say is, I wouldn't get too hung up on either metric, the inlet capacity utilization or the utilization of inlet gas in any one particular quarter because we are a fast growing company, and we do have larger facilities that are coming online. You know, if you look at those two metrics year over year, our inlet capacity utilization went from 75 to 80%.

Speaker Change #130: Yes, Paul I was I was waiting for that one.

Speaker Change #130: Sure.

What I want what I want to first just say as I.

Speaker Change #130: Wouldn't.

Paul: Get too hung up on either metric the inlet capacity utilization or the utilization of inlet gas in any one particular quarter. Because we are a fast growing company and we do have larger facilities that are coming online.

Paul: If you look at those two metrics year over year, our inlet capacity utilization went from 75% to 80% and Thats. One were always talking about same store sales growth and areas where on our that's the amount of gas that's coming into our facilities and that comes from improvements of collection systems and that sort of thing and then.

Adam J. Comora: And that's when we're always talking about same store sales growth and areas where our that's the amount of gas that's coming into our facilities. And that comes from improvements in collection systems and that sort of thing. And the metric you were asking about is then the utilization or the efficiency of turning that raw biogas into the final product.

Paul: Metric you were asking about is then the utilization of the efficiency of turning that.

Paul: Raw biogas into into final product and Thats, where it went from 86% down to 81% year over year, but if you look at it sequentially quarter over quarter, the fourth quarter inlet.

Adam J. Comora: And that's where it went from 86% down to 81% year over year. But if you look at it sequentially, quarter over quarter, you know, the fourth quarter inlet, or the utilization of inlet gas, went from 79 up to 81. And really, what you're seeing here is the ramp of Emerald, and we expect those trends to continue throughout the year. And that being said, as I was talking earlier about Prince William now in operations, you may see when a big facility comes online, your inlet capacity utilization drop, you know, or have an impact from one of those larger facilities as it ramps up. So specifically in the quarter, we did see it ticked up slightly from 79 up to 81.

Paul: Are the utilization of inlet gas went from 79 up to 81 and really what Youre seeing here is the ramp of Emerald and.

Paul: We expect those trends to continue throughout the year.

And that being said as I was talking earlier about Prince William now in operations.

You may see when a big facility comes online.

Adam J. Comora: But year over year, 86 down to 81, you know, was really that Emerald facility being in this year's metric versus not in the last years. And not outside of our expectations, by the way, which is why we also talk about this range of 80 to 90% on both of those factors, which can be skewed, as I was saying, as new facilities come online. And, you know, we feel like Emerald's ramping up well.

Paul: <unk> inlet capacity utilization drop.

Paul: Or have an impact from one of those larger facilities as it ramps up so specifically in the quarter. We did see it tick up slightly from 79 up to 81, but year over year 86 down to 81.

Paul: It's really that.

Paul: That emerald facility being in this year.

Metric versus versus not in the last years and not outside of our expectations by the way, which is why we also talk about this range of 80% to 90% on both of those on both of those factors, which can be skewed as I was saying as new facilities come online.

Adam J. Comora: And I want to say, you know, we used to get asked a lot of questions about this partnership model or JV model. Why do you partner with landfills and these types of projects? Because, you know, GFL, who's been a great partner of ours, was one of the forward thinkers, one of the first movers or forward thinkers to invest capital alongside us in these types of projects. And, you know, I have to say, working with GFL specifically on that project is really a testament to that partnership model where, you know, we're fully aligned to continue to ramp up and maximize the quality and the quantity And, you know, if we went back five or six years ago, it was really tough to get the attention of landfills to focus on those types of improvements and that sort of thing.

Paul: And we.

Paul: We feel like Emerald is ramping well and I want to say, it's also we used to get asked a lot of questions about this partnership model or JV model why do you partner with landfills in these types of projects because tfl.

Paul: Who has been a great partner of ours was one of the forward thinking.

Paul: One of the first movers are forward thinkers.

Paul: We invest capital alongside of US in these types of projects and.

Paul: I have to say working with Tfl, specifically on that project, it's really a testament to that partnership model.

Paul: We are fully aligned to continue to ramp and maximize the quality and the quantity of the gas.

Paul: That's coming into that facility and if we went back five or six years ago. It was really tough to get the attention of landfills to focus on those types of improvements in that sort of thing so.

Adam J. Comora: So, you know, the short answer is, you know, you can't just look at it year over year on those types of metrics because you have new facilities that are coming in and ramping up, but, you know, we have to look at those things in conjunction with what else is happening in the portfolio. Very good, thank you. And I'm showing no further questions at this time. I would now like to turn the call back to management for closing remarks.

Speaker Change #131: The short answer is yes.

You can't just look at it year over year on those types of metrics because you have new facilities that are coming in and ramping.

Speaker Change #131: But.

Speaker Change #131: You have to look at those things in conjunction with what else is happening in the portfolio.

Speaker Change #132: Very good thank you.

Speaker Change #133: And I'm showing no further questions at this time I would now like to turn the call back to management for closing remarks.

Adam J. Comora: All right, this is Adam Comora. Thank you very much for joining us on our first quarterly call, and I hope everybody has a great day. This concludes today's conference. Thank you for participating. You may now disconnect.

Speaker Change #133: This is Adam tomorrow. Thank you very much for joining us on our first quarter call and I hope everybody has a great day.

This concludes today's conference. Thank you for participating you may now disconnect.