Q4 2025 OPAL Fuels Inc Earnings Call

March 16, 2026

Speaker #1: Good day, and thank you for standing by. Welcome to the OPAL Fuels Q4 and full year 2025 earnings results conference call. At this time, all participants are in listen-only mode.

Operator: Good day, and thank you for standing by. Welcome to the OPAL Fuels Q4 and full year 2025 earnings results conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker for today, Todd Firestone, Vice President, Investor Relations. Please go ahead.

Speaker #1: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star one one on your telephone.

Speaker #1: You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded.

Speaker #1: I would now like to turn the conference over to your speaker for today, Todd Firestone, Vice President of Investor Relations. Please go ahead.

Todd M. Firestone: Thank you, and good morning, everyone. Welcome to the OPAL Fuels Q4 and full year 2025 earnings conference call. With me today are Co-CEOs Adam Comora and Jonathan Maurer, as well as Kazi Hasan, OPAL Fuels' Chief Financial Officer. OPAL Fuels released financial and operating results for the Q4 and full year 2025 this morning, 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 the website. After completion of today's call, a replay will be available for 90 days. Before we begin, I'd like to remind you that our remarks, including answers to your questions, contain forward-looking statements which involve risks, 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.

Speaker #2: Thank you, and good morning, everyone. Welcome to the OPAL Fuels Q4 and full year 2025 earnings conference call. With me today are co-CEOs Adam Comora and Jonathan Maurer, as well as Kazi Hasan, OPAL's Chief Financial Officer.

Speaker #2: OPAL Fuels released financial and operating results for the fourth quarter and full year 2025 this morning, and those results are available on the Investor Relations section of our website at opalfuels.com.

Speaker #2: The presentation and access to the webcast for this call are also available on the website. After completion of today's call, a replay will be available for 90 days.

Speaker #2: Before we begin, I’d like to remind you that our remarks, including answers to your questions, contain forward-looking statements which involve risks, uncertainties, and assumptions.

Speaker #2: Forward-looking statements are not a guarantee of performance, and actual results could differ materially from what is contained in such statements. Several state factors that could cause or contribute to such differences are described on slides 2 and 3 of our presentation.

Todd M. Firestone: Several state factors that could cause or contribute to such differences are described on slides 2 and 3 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 a reconciliation of these measures to the nearest GAAP measures, including an appendix of the release and presentation. Adam Comora will begin today's call by providing an overview of the quarter's results and recent highlights. Jonathan Maurer will then give a commercial and business development update, after which Kazi Hasan will review financial results. We will then open the call for questions. Now I'll turn the call over to Adam Comora, Co-CEO of OPAL Fuels.

Speaker #2: 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 #2: Additionally, this call will contain discussion of certain non-GAAP measures: a definition of non-GAAP measures used in a reconciliation of these measures to the nearest GAAP measures, including an appendix of the release and presentation.

Speaker #2: Adam will begin today's call by providing an overview of the quarter's results and recent highlights. John will then give a commercial and business development update after which Kazi will review financial results.

Speaker #2: We will then open the call for questions. And now, I'll turn the call over to Adam Comora, co-CEO of OPAL Fuels.

Speaker #3: Good morning, everyone, and thank you for participating in OPAL Fuels' fourth quarter and full year 2025 earnings call. We are pleased to be here today and look forward to discussing our 2025 results.

Adam Comora: Good morning, everyone, and thank you for participating in OPAL Fuels Q4 and full-year 2025 earnings call. We are pleased to be here today and look forward to discussing our 2025 results, our outlook and plans for 2026, and the current macro and regulatory environment. Starting with full-year and Q4 results, we are pleased the year ended strongly and adjusted EBITDA finished at $90.2 million within our guidance. On the surface, 2025 adjusted EBITDA was a flat year versus 2024. However, production grew 28%, which was masked in our financial results by several factors, including 22% lower RIN prices. Despite the macro headwinds faced by our Fuel Station Services segment throughout 2025, we are pleased we achieved strong growth in the segment.

Speaker #3: Our outlook and plans for 2026, and the current macro and regulatory environment—starting with full year and fourth quarter results. We are pleased the year ended strongly, and adjusted EBITDA finished at $90.2 million, within our guidance.

Speaker #3: On the surface, 2025 adjusted EBITDA was a flat year versus 2024. However, production grew 28%, which was masked in our financial results by several factors, including 22% lower RIN prices.

Speaker #3: Despite the macro headwinds faced by our fuel station services segment throughout 2025, we are pleased we achieved strong growth in the segment. I will offer some high-level thoughts here at the top of the call regarding our outlook for 2026, and Kazi will share more details later.

Adam Comora: I will offer some high-level thoughts here at the top of the call regarding our outlook for 2026, and Kazi will share more details later. For our RNG production outlook in 2026, we continue to be encouraged by our improved operations team, new opportunities to improve gas collection, and greater efficiencies of our plants, all driving incremental production growth from our existing assets. For our Fuel Station Services segment, we are beginning to see improving macro conditions, and other factors that could make 2026 an inflection point for new fleet adoption of CNG and RNG in heavy-duty trucking. It is important to note that these business development activities would not necessarily have a direct benefit to 2026 financial results. It typically takes us about a year to build a fueling station and begin selling fuel.

Speaker #3: For our R&G production outlook in 2026, we continue to be encouraged by our improved operations team's new opportunities to improve gas collection and greater efficiencies of our plants.

Speaker #3: All driving incremental production growth from our existing assets. For our Fuel Station Services segment, we are beginning to see improving macro conditions and other factors that could make 2026 an inflection point for new fleet adoption of CNG and R&G in heavy-duty trucking.

Speaker #3: It is important to note that these business development activities would not necessarily have a direct benefit to 2026 financial results. It typically takes us about a year to build a fueling station and begin selling fuel.

Speaker #3: So, for 2026, this segment will still be feeling the effects of the sluggish 2025 business development activity, but we are hopeful new fleet deployments will begin setting the segment up for stronger growth in 2027 and beyond.

Adam Comora: For 2026, this segment will still be feeling the effects of the sluggish 2025 business development activity, but we are hopeful new fleet deployments will begin setting the segment up for stronger growth in 2027 and beyond. I do want to comment on some policy developments as well. As many of you likely saw, on 25 February, the EPA sent to OMB the final Set Rule with updated 2026 and 2027 RVO targets. The rule is expected to be released shortly. Although we have seen strengthening bipartisan support of RNG with proactive positive tax policy from the Republican-led House and Senate, specifically the extension of the 45Z tax credit through 2029, in our view, the scale of the category within the RFS has not been as much a focus for policymakers as liquid agricultural biofuels.

Speaker #3: I do want to comment on some policy developments as well. As many of you likely saw, on February 25th, the EPA sent to OMB the final SET rule with updated 2026 and 2027 RVO targets.

Speaker #3: The rule is expected to be released shortly. Although we have seen strengthening bipartisan support of R&G, with proactive, positive tax policy from the Republican-led House and Senate, specifically the extension of the 45Z tax credit through 2029, in our view, the sale-off-a-category within the RFS has not been as much a focus for policymakers as liquid agricultural biofuels.

Speaker #3: That being said, we do believe the recent relative stability in the D3 RIN market will continue and could have an upward bias with the broader biofuels complex.

Adam Comora: That being said, we do believe the recent relative stability in the D3 RIN market will continue and could have an upward bias with the broader biofuels complex. I also want to comment on our new $180 million preferred stock facility provided by Fortistar. The additional capital from this facility can be targeted for incremental infrastructure investments across the RNG value chain. Our vertically integrated business model from producing RNG to providing access to transportation fuel offtake for CNG and RNG drives advantaged project returns relative to market peers and helps unlock the value of OPAL's project opportunities. In closing, I'd remind listeners, since going public nearly four years ago, our compounded annual growth rate for RNG production and adjusted EBITDA is 32% and 22% respectively. We are excited about where OPAL Fuels is positioned.

Speaker #3: I also want to comment on our new $180 million preferred stock facility provided by Fortis Star. The additional capital from this facility can be targeted for incremental infrastructure investments across the R&G value chain.

Speaker #3: Our vertically integrated business model, from producing R&G to providing access to transportation fuel offtake for CNG and R&G, drives advantaged project returns relative to market peers and helps unlock the value of OPAL's project opportunities.

Speaker #3: In closing, I'd remind listeners that, since going public nearly four years ago, our compounded annual growth rate for R&G production and adjusted EBITDA is 32% and 22%, respectively.

Speaker #3: We are excited about where OPAL Fuels is positioned. Our integrated model is resilient, and our results demonstrate the value of controlling the product we sell from production through dispensing to our customers.

Adam Comora: Our integrated model is resilient, and our results demonstrate the value of controlling the product we sell from production through dispensing to our customers. With that, I'll turn it over to John. John?

Speaker #3: With that, I'll turn it over to John. John?

Speaker #2: Thank you, Adam. And good morning, everyone. 2025 and early 2026 were important periods for OPAL from an operational standpoint, as well as in strengthening our capital structure and positioning the company for the next phase of growth.

Jonathan Maurer: Thank you, Adam, and good morning, everyone. 2025 and early 2026 were important periods for OPAL from an operational standpoint, as well as in strengthening our capital structure and positioning the company for the next phase of growth. Recently, we successfully completed a $180 million Series A preferred facility, which allowed us to fully repay an existing $100 million preferred investment and further strengthen the company's liquidity position. In addition, we drew approximately $128 million under our senior secured credit facility, which provides improved visibility to execute on our project portfolio. On the upstream side, our focus remains on improving performance across our existing operating assets while advancing the next wave of RNG projects currently in construction and development.

Speaker #2: Recently, we successfully completed a $180 million Series A preferred facility, which allowed us to fully repay an existing $100 million preferred investment and further strengthen the company's liquidity position.

Speaker #2: In addition, we drew approximately $128 million under our senior secured credit facility, which provides improved visibility to execute on our project portfolio. On the upstream side, our focus remains on improving performance across our existing operating assets, while advancing the next wave of R&G projects currently in construction and development.

Speaker #2: Production from facilities commissioned late in 2024 significantly increased during 2025, and sets up a stronger 2026 operating position when compared to this time last year.

Jonathan Maurer: Production from facilities commissioned late in 2024 significantly increased during 2025 and sets up a stronger 2026 operating position when compared to this time last year. I want to highlight that our upgraded operating teams have done well in bringing efficiencies to drive higher production. Despite an extraordinarily cold winter resulting in difficult operating conditions, same-facility sales growth has been meaningful, and we expect this trend to continue. Also contributing to our 2026 production growth is a full year of operations at our Atlantic facility, which came online in late 2025 and which is performing well, ramping quicker compared with recent project experience driven by higher gas flows at the landfill, allowing us to operate at higher production levels entering 2026.

Speaker #2: I want to highlight that our upgraded operating teams have done well in bringing efficiencies to drive higher production. Despite an extraordinarily cold winter resulting in difficult operating conditions, same-facility sales growth has been meaningful, and we expect this trend to continue.

Speaker #2: Also contributing to our 2026 production growth is a full year of operations at our Atlantic facility, which came online in late 2025 and which is performing well, ramping quicker compared with recent project experience—driven by higher gas flows at the landfill, allowing us to operate at higher production levels entering 2026.

Speaker #2: Looking ahead, we continue to progress our projects in construction, as we expect them to contribute to the next phase of growth for the company.

Jonathan Maurer: Looking ahead, we continue to progress our projects in construction as we expect them to contribute to the next phase of growth for the company. On the downstream side, we continue to expand our fuel station services platform, which supports RNG and CNG fueling infrastructure for heavy-duty trucking fleets. At year-end, we've grown to 61 OPAL-owned stations. While the trucking and logistics sector experienced macro softness during 2025, market fundamentals stabilized and have improved entering 2026. These improving macro fundamentals are supporting a re-engagement by fleets on their deferred truck purchases. OPAL believes CNG and RNG is garnering more attention as a replacement for diesel due to lower and more stable fuel costs, regulatory clarity regarding combustion engines, and long-term tailwinds from sustainability initiatives. Many fleet operators remain highly focused on fuel cost stability and carbon reduction.

Speaker #2: On the downstream side, we continue to expand our fuel station services platform, which supports RNG and CNG fueling infrastructure for heavy-duty trucking fleets. At year-end, we've grown to 61 OPAL-owned stations.

Speaker #2: While the trucking and logistics sector experienced macro softness during 2025, market fundamentals stabilized and have improved entering 2026. These improving macro fundamentals are supporting a re-engagement by fleets on their deferred truck purchases.

Speaker #2: OPAL believes CNG and R&G are garnering more attention as replacements for diesel due to lower and more stable fuel costs, regulatory clarity regarding combustion engines, and long-term tailwinds from sustainability initiatives.

Speaker #2: Many fleet operators remain highly focused on fuel cost stability and carbon reduction. RNG and CNG continue to be one of the most practical solutions for large-scale heavy-duty fleet decarbonization.

Jonathan Maurer: RNG and CNG continue to be one of the most practical solutions for large scale, heavy duty fleet decarbonization. As a reminder, CNG and RNG is fueling only 2% of the heavy duty trucking market and represents a large growth opportunity. Our downstream platform provides critical services and infrastructure for the fleets as they transition. Expanding this infrastructure also supports the long-term economics of our RNG production platform by providing direct access to transportation fuel markets. While large scale deployments will take time to fully translate into financial results, the work we are doing today is positioning OPAL for meaningful growth in this segment over the coming years. We continue allocating capital to the fuel station services segment, positioning OPAL to deliver on our 2026 operating plan and beyond. I'll now turn the call over to Kazi to discuss the quarter's financial performance. Kazi.

Speaker #2: As a reminder, CNG and R&G is fueling only 2% of the heavy-duty trucking market and represents a large growth opportunity. Our downstream platform provides critical services and infrastructure for the fleets as they transition.

Speaker #2: Expanding this infrastructure also supports the long-term economics of our R&G production platform by providing direct access to transportation fuel markets. While large-scale deployments will take time to fully translate into financial results, the work we are doing today is positioning OPAL for meaningful growth in this segment over the coming years.

Speaker #2: We continue allocating capital to the fuel station services segment, positioning OPAL to deliver on our 2026 operating plan and beyond. I'll now turn the call over to Kazi to discuss the quarter's financial performance.

Speaker #2: Kazi?

Speaker #3: Thank you, John. And good morning to everyone joining today's call. This quarter showed continued operational progress across the platform. This morning, we issued our earnings press release and posted an updated investor presentation on our website.

Kazi Hasan: Thank you, John, and good morning to everyone joining today's call. This quarter showed continued operational progress across the platform. This morning, we issued our earnings press release, posted an updated investor presentation on our website, and filed our Form 10-K. Before walking through the details, I would frame our financial performance around three key points. First, the resilience of our earnings despite commodity headwinds in 2025. Second, continued operational growth across both our RNG and Fuel Station Services platforms. Third, the strengthening of our liquidity and capital position to support disciplined growth in 2026 and beyond. Our 2025 results demonstrate the strength of our platform.

Speaker #3: And filed our Form 10-K. Before walking through the details, I would frame our financial performance around three key points. First, the resilience of our earnings despite commodity headwinds in 2025.

Speaker #3: Second, continued operational growth across both our R&G and fuel station services platforms. Third, the strengthening of our liquidity and capital position to support disciplined growth in 2026 and beyond.

Speaker #3: Our 2025 results demonstrate the strength of our platform. In the fourth quarter, revenue was $99.8 million, and adjusted EBITDA was $34.2 million, compared with $80 million and $22.6 million in the same period last year.

Kazi Hasan: In the Q4, revenue was $99.8 million and adjusted EBITDA was $34.2 million, compared with $80 million and $22.6 million in the same period last year, driven primarily by increased production and recognition of 45Z tax credits. For the full year, OPAL Fuels generated adjusted EBITDA of $90.2 million, essentially flat year-over-year, despite declining environmental credit prices. D2 RIN pricing declined roughly 70 cents, equivalent to approximately $33 million in adjusted EBITDA, with our realized RIN price averaging $2.45 in 2025, compared to $3.13 in 2024. This decline offset much of our operational progress achieved during the year. I'd also remind the listeners the ISCC pathway, which expired in November 2024, contributed in excess of $10 million to adjusted EBITDA in 2024.

Speaker #3: Driven primarily by increased production and recognition of 45Z tax credits. For the full year, OPAL generated adjusted EBITDA of $90.2 million, essentially flat year over year, despite declining environmental credit prices.

Speaker #3: These RIN pricing declined roughly $0.70, equivalent to approximately $33 million in adjusted EBITDA, with realized RIN price averaging $2.45 in 2025 compared to $3.13 in 2024.

Speaker #3: This decline offset much of the operational progress achieved during the year. I'd also remind the listeners that the ISCC pathway, which expired in November 2024, contributed in excess of $10 million to adjusted EBITDA in 2024.

Speaker #3: Operational growth across the platform helped offset these headwinds. R&G production reached 4.9 million MMBtu in 2025, representing 28% growth year over year, with fourth-quarter production exceeding 1.3 million MMBtu.

Kazi Hasan: Operational growth across the platform helped offset these headwinds. RNG production reached 4.9 million MMBTU in 2025, representing 28% growth year-over-year, with Q4 production exceeding 1.3 million MMBTU, up approximately 24% from the Q4 of 2024. As recently commissioned facilities moved through their first full year of operation, including a full year of Atlantic in 2026, we began to see the benefits of scale and EBITDA flow through embedded in the platform. Our Fuel Station Services segment continues to strengthen the stability of our earnings mix. In 2025, segment EBITDA increased to $46.7 million from $38.4 million in 2024, 22% higher than 2024.

Speaker #3: Approximately 24% from the fourth quarter of 2024. As recently commissioned, facilities moved through their first full year of operation, including a full year of Atlantic in 2026, which began to see the benefits of scale and EBITDA flow-through embedded in the platform.

Speaker #3: Our fuel station services segment continues to strengthen the stability of our earnings mix. In 2025, segment EBITDA increased to $46.7 million, from $38.4 million in 2024.

Speaker #3: 22% higher than 2024. Although this segment exhibited strong growth in 2025, it was below our guidance, primarily due to deferred investment decisions by our fleet partners regarding new stations and new truck purchases.

Kazi Hasan: Although this segment exhibited strong growth in 2025, it was below our guidance primarily by deferred investment decisions by our fleet partners regarding new stations and new truck purchases. This quarter's results also reflect the restatement of our G&A presentation, where facility-specific G&A is now allocated to operating segments rather than corporate. We restated 2024 for comparability and will apply this approach going forward as we believe it better reflects segment economics. Turning to liquidity and capital deployment. We ended the year with $184 million of total liquidity, including approximately $30 million of cash and short-term investments.

Speaker #3: This quarter's results also reflect a restatement of our G&A presentation, where facility-specific G&A is now allocated to operating segments rather than corporate. We restated 2024 for comparability and will apply this approach going forward, as we believe it better reflects segment economics.

Speaker #3: Turning to liquidity and capital deployment. We ended the year with $184 million of total liquidity, including approximately $30 million of cash and short-term investments.

Speaker #3: $138 million of undrawn capacity under our term facility, and $16 million of revolver availability. Capital expenditures and investments in joint venture projects for the quarter were approximately $16 million.

Kazi Hasan: $138 million of undrawn capacity under our term facility and $16 million of revolver availability. Capital expenditures and investments in joint venture projects for the quarter were approximately $16 million, primarily related to new RNG facilities and OPAL-owned fueling stations, and $19 million for full year 2025. In 2025, we monetized approximately $43 million of investment tax credits. Our current liquidity is further bolstered by the recent closing of a $180 million Series A preferred facility, operating cash flow, and drawdown of the remaining $128 million of availability under our term loan facility. Looking ahead, we are providing 2026 adjusted EBITDA guidance of $95 million to $110 million, representing approximately 14% growth at the midpoint compared to 2025.

Speaker #3: Primarily related to new R&G facilities and OPAL-owned fueling stations. And $90 million for the full year 2025, including $43 million of investment tax credits. Our current liquidity is further bolstered by the recent closing of the $180 million Series A preferred facility, operating cash flow, and drawdown of the remaining $128 million of availability under our term loan facility.

Speaker #3: Looking ahead, we are providing 2026 adjusted EBITDA guidance of $95 million to $110 million, representing approximately 14% growth at the midpoint compared to 2025.

Speaker #3: We expect R&G production between 5.4 million and 5.8 million MMBTU, representing more than 14% growth versus 2025. This is driven primarily by improved performance from our existing asset base.

Adam Comora: We expect RNG production between 5.4 million and 5.8 million MMBTU, representing more than 14% growth versus 2025, driven primarily by improved performance from our existing asset base, continued ramp of recently commissioned projects, and marginal contributions from projects entering service during 2026. Our guidance also considers what has been a challenging winter to start 2026. Additionally, we are assuming approximately $15 to 20 million of 45Z credits during the year. Stepping back, our financial strategy remains clear. We are focused on growing operating and free cash flow and allocating capital within the capacity of our operating cash flow, balance sheet strength, and access to capital markets. Opal is generating an increasingly balanced and durable earnings base with the flexibility to accelerate growth where returns justify it. With that, I'll turn the call back over to John for closing remarks. John?

Kazi Hasan: We expect RNG production between 5.4 million and 5.8 million MMBTU, representing more than 14% growth versus 2025, driven primarily by improved performance from our existing asset base, continued ramp of recently commissioned projects, and marginal contributions from projects entering service during 2026. Our guidance also considers what has been a challenging winter to start 2026. Additionally, we are assuming approximately $15 to 20 million of 45Z credits during the year. Stepping back, our financial strategy remains clear. We are focused on growing operating and free cash flow and allocating capital within the capacity of our operating cash flow, balance sheet strength, and access to capital markets. Opal is generating an increasingly balanced and durable earnings base with the flexibility to accelerate growth where returns justify it. With that, I'll turn the call back over to John for closing remarks. John?

Speaker #3: Continued ramp of recently commissioned projects and marginal contributions from projects entering service during 2026. Our guidance also considers what has been a challenging winter to start 2026.

Speaker #3: Additionally, we're assuming approximately $15 to $20 million of 45Z credits during the year. Stepping back, our financial strategy remains clear. We are focused on growing operating and free cash flow and allocating capital within the capacity of our operating cash flow, balance sheet strength, and access to capital markets.

Speaker #3: OPAL is generating an increasingly balanced and durable earnings base, with the flexibility to accelerate growth where returns justify it. With that, I'll turn the call back over to John for closing remarks.

Speaker #3: John.

Speaker #1: In closing, we remain well positioned for continued disciplined execution of our strategic growth objectives and the expansion of OPAL's vertically integrated platform. And with that, I'll turn the call over to the operator for Q&A.

Jonathan Maurer: In closing, we remain well positioned for continued disciplined execution of our strategic growth objectives and the expansion of OPAL's vertically integrated platform. With that, I'll turn the call over to the operator for Q&A. Thank you all for your interest in OPAL Fuels.

Speaker #1: Thank you all for your interest in OPAL Fuels.

Speaker #2: Thank you. As a reminder, if you would like to ask a question, please press star 1-1 on your telephone. You'll hear an automated message advising your hand is raised.

Operator: Thank you. As a reminder, if you would like to ask a question, please press star one one on your telephone. You'll hear the automated message advising your hand is raised. We also ask that you please wait for your name and company to be announced before proceeding with your question. One moment while we compile the Q&A roster. Our first question for today will be coming from the line of Derrick Whitfield of Texas Capital. Your line is open.

Speaker #2: We also ask that you please wait for your name and company to be announced before proceeding with your question. One moment while we compile the Q&A roster.

Speaker #2: Our first question for today will be coming from the line of Derek Whitfield of Texas Capital. Your line is open.

Speaker #3: Good morning, all, and congrats on a strong year-end update.

Derrick Whitfield: Good morning, all, and congrats on a strong year-end update.

Speaker #4: Thanks, Derek.

Jonathan Maurer: Thanks, Derrick.

Speaker #5: Thanks, Derek. Good morning.

Adam Comora: Thanks, Derrick. Good morning.

Speaker #4: Starting with liquidity and your growth outlook on slide six, with the preferred financing behind you, could you speak to what the next phase of growth looks like for OPAL beyond the projects that are currently in your development queue?

Derrick Whitfield: Starting with liquidity and your growth outlook on slide 6. With the preferred financing behind you, could you speak to what the next phase of growth looks like for OPAL beyond the projects that are currently in your development queue? If you could also just comment on how much CapEx is required to bring those projects in your development queue online.

Speaker #4: And if you could also just comment on how much CapEx is required to bring those projects in your development queue online.

Speaker #5: Yeah, thanks, Derek. This is Adam here. I'll maybe start, and then if Kazi or John want to fill in, they can. I think most—or hopefully most—saw that we updated our liquidity position on March 10th.

Adam Comora: Yeah. Thanks, Derrick. This is Adam here. I'll maybe I'll start, and then if Kazi or Jonathan wanna fill in. I think you know, most or hopefully most saw that we updated our liquidity position on March 10, and currently have about $160 million liquidity available to complete the projects that we had noted that are in construction. It's about 2.8 million MMBTUs of in-construction projects and some Fuel Station Services fueling stations as well. In addition to that liquidity position to complete what we've announced, we've also got $60 million unused drawn capacity on the preferred facility, plus operating cash flows that continue to grow and is also available for new capital deployment.

Speaker #5: And currently have about $160 million liquidity available to complete the projects that we had noted that are in construction. It's about 2.8 million MMBTUs of in-construction projects and some fueling station services, fueling stations as well.

Speaker #5: In addition to that liquidity position to complete what we've announced, we've also got $60 million unused drawn capacity on the preferred facility, plus operating cash flows that continue to grow and are also available for new capital deployment.

Adam Comora: you know, we've got a number of robust project opportunities between new biogas to RNG conversion projects on our Renewable Power. What we're really getting excited about is allocating more capital to the Fuel Station Services business. If you just look at what's in construction today and what that could contribute to EBITDA and cash flow, you know, I think we always talk about rough guidance of $20 per MMBTU of EBITDA and cash flow from RNG production. If you do the math on what we've got in construction and earmarked with that $160 million of liquidity that's available today, you know, based on how these things come out of the gates, that could be another 2 million of production in their early days of production.

Speaker #5: And we've got a number of robust project opportunities between new biogas sites, conversion projects on our renewable power, and what we're really getting excited about is allocating more capital to the fuel station services business.

Speaker #5: So if you just look at what's in construction today and what that could contribute to EBITDA and cash flow, I think we always talk about rough guidance of $20 per MMBTU of EBITDA and cash flow from R&G production. And if you do the math on what we've got in construction and earmarked with that $160 million of liquidity that's available today, based on how these things come out of the gates, that could be another $2 million of production in their early days of production.

Adam Comora: We think we're in a really good spot to grow, you know, our EBITDA and operating cash flow from what we've announced so far. We've got a number of projects on the upstream side that we think are really good candidates to deploy and invest capital. We are always gonna be mindful of our balance sheet, and making sure that our liquidity and leverage ratios stay lockstep for the cash flow generation of the business. You should expect us to talk about some new projects. On the RNG production side, and we're really hopeful and optimistic that a larger part of our capital will be getting deployed into fuel stations. As I know there'll be some questions later on on fleet conversions and what our outlook is there.

Speaker #5: So, we think we're in a really good spot to grow our EBITDA and operating cash flow from what we've announced so far, and we've got a number of projects on the upstream side that we think are really good candidates to deploy and invest capital.

Speaker #5: We are always going to be mindful of our balance sheet, and making sure that our liquidity and leverage ratios stay in lockstep with the cash flow generation of the business.

Speaker #5: But you should expect us to talk about some new projects on the R&G production side, and we're really hopeful and optimistic that a larger part of our capital will be getting deployed into fuel stations, as I know there'll be some questions later on about fleet conversions and what our outlook is there.

Adam Comora: you know, you should think about OPAL Fuels as a growth company. You know, if you look at our four-year track record, you know, we think we've got the capital in place and operating cash flow to continue to grow, you know, in those sorts of fashions as you look at us over the next several years.

Speaker #5: But you should think about OPAL Fuels as a growth company. If you look at our four-year track record, we think we've got the capital in place and operating cash flow to continue to grow in those sorts of fashions as you look at us over the next several years.

Speaker #3: Great. And then maybe, perhaps for John—so you guys accomplished a nice increase in your inlet utilization levels in the fourth quarter. Could you speak to some of the drivers and also highlight where you expect utilization levels to level out, based on some of the capture opportunities Adam referenced in his prepared remarks?

Derrick Whitfield: Great. Maybe perhaps for Jonathan. You guys accomplished a nice increase in your inlet utilization levels in Q4. Could you speak to some of the drivers, and also highlight where you expect utilization levels to level out based on some of the capture opportunities Adam Bubes referenced in his prepared remarks?

Speaker #1: Sure. And thanks for the question. We're really proud of the team that we've been building on the operations side. We've been growing our capabilities both on the upstream and downstream side.

Jonathan Maurer: Sure. Thanks for the question. We're really proud of the team that we've been building on the operations side. We've been growing our capabilities, both on the upstream and downstream side, and I think this is reflected over the course of the year, you know, first in terms of the operations of these projects and that, you know, we measure through the efficiency and availability of the projects, which has increased over the course of 2025, kind of from the 70-ish% level, closer to the 80% level now that we're seeing. Really strong kudos to the team for doing that. In terms of where we're headed with it and what the possibilities are, we really see the opportunity for continued improvement there.

Speaker #1: And I think this is reflected over the course of the year. First, in terms of the operations of these projects, and that we measure through the efficiency and availability of the projects, which has increased over the course of 2025, kind of from the 70-ish percent level closer to the 80% level now that we're seeing.

Speaker #1: So, really strong kudos to the team for doing that. In terms of where we're headed with it and what the possibilities are, we really see the opportunity for continued improvement there.

Speaker #1: And we think about kind of an 85 to 86 percent utilization level as something that ought to be readily achievable. And in certain instances, we are able to beat that as well.

Jonathan Maurer: We think about kind of an 85-86% utilization level as something that ought to be readily achievable, and in certain instances, we are able to beat that as well. You combine that utilization with our open and growing landfills that our projects are located on, as well as the headroom for additional capacity. The projects are larger than the amount of the gas coming out. As a result, we see growth not only from operating the projects better, but also from the growth in the gas. That gives us a lot of optimism in 2026.

Speaker #1: You combine that utilization with our open and growing landfills that our projects are located on, as well as the headroom for additional capacity—that projects are larger than the amount of the gas coming out as a result—we see growth not only from operating the projects better, but also from the growth in the gas.

Speaker #1: So that gives us a lot of optimism in 2026, and really you've hit on kind of a focus of ours this year, where we're really going to be, I think, very focused on growing that utilization, growing the gas, and resulting in better output per project.

Jonathan Maurer: Really, you've hit on kind of a focus of ours this year, where we're really going to be, I think, very focused on growing that utilization, growing the gas, and resulting in a better output per project, for each of the projects and for the whole portfolio in total. We're looking forward to that. Thanks.

Speaker #1: For each of the projects, and for the whole portfolio in total. So, we're looking forward to that. Thanks.

Speaker #3: That's great, guys. Sounds like it's very capital-efficient growth for you in '26.

Derrick Whitfield: That's great, guys. Sounds like it's very capital efficient growth for you in 2026.

Speaker #4: Thank you. One moment for the next question. And our next question is coming from the line of Matthew Blair of TPH. Your line is open.

Operator: Thank you. One moment for the next question. Our next question is coming from the line of Matthew Blair of TPH&Co. Your line is open.

Matthew Blair: Thank you. Good morning, everyone. Maybe just to stack on to the last question. Are there any specific examples of things that you're changing going forward to help improve operations? You know, are there any specific assets where you're really looking to improve the overall utilization? Also, I think there was a comment that most of the growth is coming from the existing asset base. I just wanted to check. Are Cottonwood and Burlington still expected to start up in 2026? I guess the idea would be that due to the ramp process, that probably wouldn't help out too much on 2026. That would really help out more on later years. Is that the right way to think about it? Thank you.

Speaker #5: Thank you, and good morning, everyone. Maybe just to stack on to the last question, are there any specific examples of things that you're changing going forward to help improve operations, and are there any specific assets where you're really looking to improve the overall utilization?

Speaker #5: And then also, I think there was a comment that most of the growth is coming from the existing asset base, but I just wanted to check, are Cottonwood and Burlington, are those still expected to start up in 2026?

Speaker #5: But I guess the idea would be that, due to the ramp process, that probably wouldn't help out too much on 2026. That would really help out more on later years.

Speaker #5: Is that the right way to think about it? Thank you.

Speaker #1: Yep. Thank you very much. So, first off, most of the growth in output that we're looking forward to this year is coming from the same store sales. We've really incorporated very little from those projects into our guidance.

Jonathan Maurer: Yep. Thank you very much. First off, most of the growth in output that we're looking forward to this year is coming from the same store sales. We've really incorporated very little from those projects into our guidance. While we do continue to focus on those projects in construction and bringing them online, as I said, I think our focus really more is on operating efficiencies and availabilities for our existing projects. In terms of some specific examples, you know, some of our projects, for example, have no nitrogen rejection units associated with them. In projects like that, we're probably more focused on tuning gas to a higher quality methane, lower amount of nitrogen, oxygen. For other ones with nitrogen rejection, we're focused on increasing the amounts of the gas there.

Speaker #1: While we do continue to focus on those projects and construction and bringing them online, as I said, I think our focus really is more on operating efficiencies and availabilities for our existing projects.

Speaker #1: In terms of some specific examples, some of our projects, for example, have no nitrogen rejection units associated with them. So in projects like that, we're probably more focused on tuning gas to a higher quality methane, lower amount of nitrogen, oxygen.

Speaker #1: For other ones with nitrogen rejection, we're focused on increasing the amounts of the gas there. In terms of the teams themselves, we're really focused on just training across the platform in each of the units.

Jonathan Maurer: In terms of the teams themselves, we're really focused on just training across the platform in each of the units. These are process-driven projects, and the processes require a balance across the quality of the gas, the quantity of the gas, the membrane, CO2 rejection, the nitrogen rejection, PSAs, et cetera. Balancing that is, I think, been a bit of a learning process for the team over the last couple of years, and that's why we're seeing the continued improvement there.

Speaker #1: These are process-driven projects, and the processes require a balance across the quality of the gas, the quantity of the gas, the membrane CO2 rejection, the nitrogen rejection PSAs, etc.

Speaker #1: And so, balancing that has, I think, been a bit of a learning process for the team over the last couple of years. And that's why we're seeing the continued improvement there.

Jonathan Maurer: Other projects that are closer to or at their nameplate capacity in terms of gas, we're really focused on, again, improving the quality of the inlet gas there so that, whereas, you know, for every unit of gas that comes in, if you have more methane in the unit of gas, then you'll have greater output. We're focused on those aspects as well. We just see that focus continuing during the course of the year with our output increasing.

Speaker #1: Other projects that are closer to, or at, their nameplate capacity in terms of gas—we're really focused on, again, improving the quality of the inlet gas there.

Speaker #1: So that whereas for every unit of gas that comes in, if you have more methane in that unit of gas, then you'll have greater output.

Speaker #1: So we're focused on those aspects as well, and we just see that focus continuing during the course of the year, with our output increasing.

Speaker #6: Yeah. I would just add there—this is Adam. There are no significant delays in either of those two projects. We just think it's best to be conservative in terms of the exact timing and the exact ramp.

Adam Comora: Yeah, I would just add there, this is Adam, there are no significant delays in either of those two projects. We just think it's best to be conservative in terms of, you know, the exact timing and the exact ramp. We've, you know, focused our guidance around just improving the operations at the existing facilities.

Speaker #6: So, we've focused our guidance around just improving the operations at the existing facilities.

Speaker #5: Okay, sounds good. Thanks for the color. And then could you talk about the relationship going forward with NextEra? They're called the preferred, but I think they also have an equity ownership in OPAL, and then a fairly extensive commercial relationship with you.

Matthew Blair: Okay. Sounds good. Thanks for the color. Could you talk about the relationship going forward with NextEra? You know, they called the preferred, but I think they also have an equity ownership in OPAL and then a fairly extensive commercial relationship with you. Is anything changing on those fronts?

Speaker #5: Is anything changing on those fronts?

Speaker #6: Yeah, I'll take that one on. NextEra has been a terrific partner of ours for a long period of time. And we do still work with them quite closely on that environmental credit trading agreement that you referenced.

Adam Comora: Yeah, I'll take that one on. NextEra has been a terrific partner of ours for a long period of time. We do still work with them quite closely on, you know, that environmental credits trading agreement that you referenced. They still are 50% owners in our Noble and Pine Bend projects. We continue to work with NextEra, continue to view them as a good partner. We advocate side by side with them on a lot of key issues, and you know, don't see anything really materially changing from that perspective at this point.

Speaker #6: And they still are 50% owners in our Noble and Pine Bend projects. So we continue to work with NextEra, continue to view them as a good partner.

Speaker #6: We advocate side by side with them on a lot of key issues, and don't see anything really materially changing from that perspective at this point.

Speaker #5: Sounds good. Thank you.

Matthew Blair: Sounds good. Thank you.

Speaker #4: Thank you. One moment for the next question. Our next question will be coming from the line of Orion Finks of Riley Securities. Your line is open.

Operator: Thank you. One moment for the next question. Our next question will be coming from the line of Ryan Pfingst of B. Riley Securities. Your line is open.

Speaker #7: Hey, guys. Thanks for taking my questions. Just curious, about a KPI you've referenced in the past, do you have a goal for how much MMB2 capacity you'd like to place into construction in 2026?

Ryan Pfingst: Hey, guys. Thanks for taking my questions. Just curious about a KPI you've referenced in the past. Do you have a goal for how much MMBTU capacity you'd like to place into construction in 2026?

Speaker #6: Yeah, this is Adam. And I appreciate the question. We do see a significant, strong pipeline of new project opportunities to place into construction, both from new greenfield biogas rights that we've secured, and also renewable power conversion projects, of which we have a few sizable ones in our portfolio.

Adam Comora: Yeah, this is Adam here, and I appreciate the question. You know, we do see a significant strong pipeline of new project opportunities to place into construction, both from new greenfield biogas rights that we've secured and also Renewable Power conversion projects, which we have a few sizable ones in our portfolio. You know, as I was trying to reference in an earlier question, you know, we also see other opportunities on our Fuel Station Services segment to invest in fuel stations. We also see opportunistic M&A opportunities. We will continue to invest capital in our business being mindful of our balance sheet strength and liquidity.

Speaker #6: And as I was trying to reference in an earlier question, we also see other opportunities on our fuel station service segment to invest in fuel stations.

Speaker #6: We also see opportunistic M&A opportunities, and we will continue to invest capital in our business, being mindful of our balance sheet strength and liquidity. We just feel like, as we're allocating capital across those different segments or different opportunities, it may not be all on the production side.

Adam Comora: you know, we just feel like as we're allocating capital across those different segments or different opportunities, it may not be all on the production side, it may be in these other areas of our business. Which by the way, there are so many reasons why we like the Fuel Station Services segment between diversity of earnings stream, between, you know, open-ended growth opportunity where we think diesel to CNG could be really an interesting economic, you know, large growth potential, and a little diversity away from the renew, you know, some of the regulatory policy out there. you know, we don't think it's really wise just to talk about one segment for where we're investing capital, but we do expect to put more RNG projects into construction.

Speaker #6: It may be in these other areas of our business, which, by the way, there are so many reasons why we like the fuel station services segment—between diversity of earning streams, and the open-ended growth opportunity, where we think diesel to CNG could be a really interesting, economically large growth potential.

Speaker #6: And a little diversity away from some of the regulatory policy out there. So, we don't think it's really wise just to talk about one segment for where we're investing capital, but we do expect to put more R&G projects into construction.

Speaker #6: And look, we have a large R&G production growth profile just from what we've announced already. So that's how we're sort of thinking about it.

Adam Comora: Look, we have a large RNG production growth profile just from what we've announced already. You know, that's how we're sort of thinking about it. You should expect us to continue to invest in production assets.

Speaker #6: But you should expect us to continue to invest in production assets.

Speaker #7: I appreciate that color. And it leads up to my follow-up, which is around CapEx and that number for '26. Looks like $154 million this year.

Ryan Pfingst: Appreciate that color, and leads up to my follow-up, which is around CapEx and that number for 2026. Looks like $154 million this year. I was curious if you could give us a sense of the breakdown between RNG projects and fuel stations there.

Speaker #7: I was curious if you could give us a sense of the breakdown between R&G projects and fuel stations there.

Kazi Hasan: Let me give you a bit of a carryover from what Adam just mentioned. The $154 million primarily are most of the construction committed projects we have, and a little bit of a committed downstream dispensing station investments as well. Lion's share production and a little bit smaller part of the dispensing station. Now, I want to reiterate that as you have heard from Adam, we would prefer to not provide a guidance specifically around where we are gonna make the most of our investments. I think every investments will be competing for the dollar that's available from our capital operating cash flow and the future capital availability from the capital markets. I think we're gonna be a little bit more judicious.

Speaker #1: So let me give you a bit of a carryover from what Adam just mentioned. The $154 million is primarily most of the committed construction projects we have.

Speaker #1: And a little bit of committed downstream dispensing station investments as well. So, lion's share production, and a little bit smaller part of the dispensing station.

Speaker #1: Now, I want to reiterate that, as you have heard from Adam, we would prefer to not provide guidance specifically around where we are going to make the most of our investments.

Speaker #1: So, I think every investment will be competing for the dollar that's available from our capital, operating cash flow, and the future capital availability from the capital markets.

Speaker #1: So I think we're going to be a little bit more judicious, so that's where I'm going to end it.

Kazi Hasan: That's where I'm gonna end it.

Speaker #7: Understood. I appreciate it, guys.

Ryan Pfingst: Understood. I appreciate it, guys.

Speaker #4: Thank you. One moment for the next question, please. The next question will be coming from the line of Adam Bubbits of Goldman Sachs. Your line is open.

Operator: Thank you. One moment for the next question, please. The next question will be coming from the line of Adam Bubes of Goldman Sachs. Your line is open.

Speaker #8: Hi, good morning. Sounds like you're seeing some green shoots in fuel station services, but as you alluded to, because of the lag, that's maybe a 2027 story. What level of growth are you embedding in guidance for fuel station services in 2026?

Adam Bubes: Hi, good morning. Sounds like you're seeing some green shoots in Fuel Station Services, but as you alluded to, because of the lag, it's maybe a 2027 story. What level of growth are you embedding in guidance for Fuel Station Services in 2026? And is low 20s the right way to think about margins in that segment on a sustained basis or any levers for margin expansion?

Speaker #8: And is low 20s the right way to think about margins in that segment on a sustained basis, or are there any levers for margin expansion?

Speaker #6: Yeah, Adam. This is Adam here. A couple of things. Yes, you are correct. There's always—just like on our R&G project—investments that take 18 months or so on average when you...

Adam Comora: Yeah. Adam, this is Adam here. A couple of things. Yes, you are correct. You know, there's always, just like on our RNG project, investments that, you know, take 18 months or so on average, you know, when you invest the capital to when you start recognizing revenues, EBITDA, and cash flow. Fuel Station Services has a slightly shorter cycle to it when we invest in new fuel stations. We really think of 2026 as the biz dev activity that sets the stage for future growth. Our 2026, you know, we aren't anticipating the same levels of growth in Fuel Station Services that we've experienced after the next several.

Speaker #1: You invest the capital too. When you start recognizing revenues and EBITDA and cash flow, fuel station services has a slightly shorter cycle to it.

Speaker #1: When we invest in new fuel stations, we really think of 2026 as the biz dev activity that sets the stage for future growth.

Speaker #1: So our , you know , 2026 , you know , we , we aren't anticipating the same levels of growth in fuel station services that we've , that we've experienced after , after the next several .

Speaker #1: But we , we are , you know , really excited about some of those green shoots . And we can go into , you know , what were those macros where we see them alleviating and some interesting sort of market structure dynamics that that were that we think were breaking through there .

Adam Comora: We are, you know, really excited about some of those green shoots. We can go into, you know, what were those macros, where we see them alleviating, and some interesting sort of market structure dynamics that we think we're breaking through there. As for margin expansion, you know, it is, you know, from a margin perspective, higher margin business when we own fuel stations, dispense RNG at those stations versus typical construction and service margins. We do anticipate, as we own more fueling stations, that the margins will naturally move higher in that segment, and that's where we see a lot more of the growth coming.

Speaker #1: But . As for margin expansion , you know , it is , you know , from a margin perspective , higher margin business when we own fuel stations , dispense RNG at those stations versus typical construction and service margins .

Speaker #1: So, we do anticipate as we own more fueling stations that the margins will naturally move higher in that segment. And that's where we see a lot more of the growth coming.

Speaker #2: And then maybe as a

Adam Bubes: And then maybe as a-

Kazi Hasan: Let me also add one thing.

Adam Comora: Oh, yeah. Kazi had a follow-up.

Speaker #3: Follow me , I just want to follow up on Adam's . When we do the fuel station services , capital investments , we definitely rely on a base level of dispensing volume .

Kazi Hasan: Sorry. I just want to follow up on Adam's. When we do the Fuel Station Services capital investments, we definitely rely on a base level of dispensing volume. In more cases than not where we see that embedded growth in those fuel dispensing, and which similar to that we have the growth in the production and downstream side, we also do see the throughput going through these stations in the downstream side as well. There are similar type of growth embedded in there, and we do expect that to be realized.

Speaker #3: But in more cases than not , where we see that embedded growth in those fuel dispensing and which similar to that , we have the the growth in the production and upstream side .

Speaker #3: We also do see the throughput going through these stations in the downstream side as well. So there are similar types of growth embedded in there.

Speaker #3: And we do expect that to be realized.

Speaker #1: Yeah . And you also understand that there is certain inter segments where , you know , there has been a tightening in the dispensing market , which which also assists in margins on the fuel station service side

Adam Comora: Yeah. You also understand that there is certain intersegments where, you know, there has been a tightening in the dispensing market, which also assists in margins on the fuel station service side.

Speaker #2: And then maybe as the , you know , natural follow up there based on your conversations with customers , what you're seeing in the macro environment , what is giving you that underlying confidence and visibility on a potential inflection in 2027 ?

Adam Bubes: Maybe as the natural follow-up there, based on your conversations with customers, what you're seeing in the macro environment, what is giving you that underlying confidence and visibility on a potential inflection in 2027 and the potential rise in natural gas vehicle adoption?

Speaker #2: And, you know, potential rise in natural gas vehicle adoption.

Speaker #1: Yeah , no , I appreciate that question . It is something that I think about quite a bit as I as I look both to the US market and I think about what's happening overseas in places like China , which which by the way , China , I think is deploying about 30,000 natural gas engines .

Adam Comora: Yeah. No, I appreciate that question. It is something that I think about quite a bit as I look both to the US market, and I think about what's happening overseas in places like China, which by the way, China, I think, is deploying about 30,000 natural gas engines, the X15N, each year. China's on a path to have their heavy duty trucking, you know, move up to 25% of their fuel mix. We haven't gotten there yet in the US. We're at about 2%, which is really interesting when you think about it given the position the US has in natural gas as a commodity and the low cost and stable nature of that versus diesel and oil.

Speaker #1: The X15 each year , and China is on a path to have their heavy duty trucking , you know , move up to 20 , 25% of of their fuel mix and we haven't gotten there yet in the US , we're at about 2% , which is really interesting when you think about it , given the position the US has in natural gas as a commodity and the low cost and stable nature of that versus versus diesel and oil .

Adam Comora: You know, specifically in 2025, you know, there were macro headwinds that were affecting some of our largest customers in the logistics and trucking space. You know, started off being tariffs, a continued freight recession. We had some regulatory overhang on combustion engines. We also had initial testing of the X15N liter engine. All of those factors did delay some investment decisions and deferred new truck purchases or new station purchases. We think as we're now moving into 2026, a lot of those fleets have started acclimating to the macro environment and started thinking about new truck purchases and that sort of thing, and they're re-engaging.

Speaker #1: But , you know , specifically in 2025 , you know , there were there were macro headwinds that were affecting some of our largest customers in the logistics and trucking space .

Speaker #1: You know , started off being being tariffs , a continued freight recession . We had some regulatory overhang on , on , you know , combustion engines .

Speaker #1: We also had initial testing of the X-15 Leader engine, and all those factors did delay some investment decisions, either around, you know, and deferred new truck purchases or new station purchases.

Speaker #1: And , you know , we think as , as we're now moving into 2026 , a lot of those fleets have started acclimating to the macro environment and started thinking about new truck purchases and that sort of thing .

Speaker #1: And there re-engaging , you've now moved through the X15 and testing phase . So so the fleets are are are more comfortable with the technology and , and the performance .

Adam Comora: You've now moved through the X15N end testing phase, so the fleets are more comfortable with the technology and the performance. You know, the diesel and, you know, the volatility and absolute price that folks are starting to see in diesel and oil is really making natural gas a lot more attractive. Then you layer into the fact that it also, you know, assists those that are thinking about, you know, their sustainability metrics or emissions profiles and that sort of thing. It's really setting up for, you know, what we think, some investment decisions here in 2026 around this technology. You know, CNG and RNG have really proven themselves out as something that works for the fleets.

Speaker #1: And you know , the diesel and , you know , the volatility and absolute price that , that folks are starting to see in diesel and oil is really making natural gas a lot more attractive .

Speaker #1: And then you layer into the fact that it also , you know , assists those that are thinking about , you know , their sustainability metrics or emissions profiles and that sort of thing .

Speaker #1: So it's really setting up for , you know , what we think some investment decisions here in 26 around , around this technology and you know , you know , CNG and RNG have really proven themselves out as something that works for the fleets .

Speaker #1: So those are the , those are , you know , some of the things that , you know , have either alleviated or some new potential positive macros with what we've seen with , with diesel and oil prices .

Adam Comora: Those are, you know, some of the things that, you know, have either alleviated or some new potential positive macros with what we've seen with diesel and oil prices. You know, one thing that's interesting about the US versus China is sort of the market structure, where, you know, here in the US, you know, you still have to work through not only the engine price, the OEMs, and the dealerships in order to get that product to market. You know, we're encouraged that a lot of those things are starting to break through. You know, one other interesting one here in the US I'll touch on is fuel surcharges, where, you know, the economics look pretty good on paper.

Speaker #1: You know , one thing that's interesting about the US versus China are , you know , is sort of the market structure where , you know , here in the US , you know , you still have to work through not only the engine price , the OEMs and the dealerships in order to get that product to market .

Speaker #1: And , you know , we , we are , we're encouraged that a lot of those things are starting to starting to break through and , you know , one , one other interesting one here in the US .

Speaker #1: I'll touch on is fuel surcharges , where , you know , the economics look look pretty good on paper . And then , you know , fleets have to think about , okay , how do I deal with fuel surcharges ?

Adam Comora: you know, fleets have to think about, okay, how do I deal with fuel surcharges? you know, make sure that it doesn't disrupt how they're doing business. you know, we are seeing you know, a movement across that whole spectrum of either macros or market structure here. we are cautiously optimistic that you know, that biz dev activity will accelerate here in 2026 and then really provide some visibility into 2027 and beyond.

Speaker #1: And , you know , make sure that it doesn't disrupt how they're doing business , but , you know , we are seeing , you know , a movement across that , that that whole spectrum of either macros or market structure here and we are cautiously optimistic that , you know , that bizdev activity will accelerate here in 26 and then really provide some visibility into 27 and beyond .

Speaker #2: Very interesting. Thanks so much.

Todd M. Firestone: Very interesting. Thanks so much.

Adam Bubes: Very interesting. Thanks so much.

Speaker #4: Thank you . If you would like to ask a question , please press star one one on your telephone . One moment for the next question Our next question is coming from the line of Betty Zhang of Scotiabank .

Operator: Thank you. If you would like to ask a question, please press star one one on your telephone. One moment for the next question. Our next question is coming from the line of Betty Zhang of Scotiabank. Your line is open.

Speaker #4: Your line is open

Speaker #5: Thanks . Good morning . Thanks for taking my question . In your opening remarks , you mentioned the Ahrefs . Just wanted to get your take on the cellulosic side .

Betty Zhang: Thanks. Good morning. Thanks for taking my question. In your opening remarks, you mentioned the RFS. Just wanted to get your take on the cellulosic side. Do you expect any impact on D3 volumes and, just what your expectations are there?

Speaker #5: Do you expect any impacts on DC wins, and just what your expectations are there?

Speaker #1: Yeah , no , I appreciate that question . This is Adam again , and I think as we had noted , and people probably saw the the EPA did send their final rule over on 26 and 27 to OMB .

Adam Comora: Yeah. No, I appreciate that question. This is Adam again. I think, as we had noted and people probably saw, the EPA did send their final rule over on 26 and 27 to OMB. You know, we hope that recent geopolitical events don't slow down the process, as we have seen this little bit of an oil price shock and that sort of thing. We hope that the EPA still sticks to you know, ordinary course of business timing, and it gets released pretty soon.

Speaker #1: And, you know, we hope that recent geopolitical events don't slow down the process, as we have seen this little bit of an oil price shock and that sort of thing.

Speaker #1: So we we hope that the EPA still sticks to nor , you know , ordinary course of business timing . And it gets released pretty soon .

Adam Comora: You know, what I'd say about the cellulosic category is, you know, we feel really good about the bipartisan support that we've got, you know, in the Congress as it pertains to tax policy and how they view RNG, you know, sort of in the spectrum of smart or pragmatic policy on where, you know, folks should invest and that sort of thing. What I would say is, it still feels like the cellulosic category maybe isn't getting the same level of intention as liquid agricultural biofuels, where, you know, they're really. You know, it seems apparent that there is clear focus to support, you know, those areas and really lean in. I would say from the cellulosic category, it's not a lean out, it's not a lean in.

Speaker #1: You know what I'd say about the cellulosic category is , you know , we , we feel really good about the bipartisan support that we've got .

Speaker #1: You know , in the Congress as it pertains to tax policy and how they they view RNG , you know , sort of in the spectrum of , of smart or pragmatic policy on , on where , you know , you know , folks should invest in that sort of thing .

Speaker #1: And what I would say is it still feels like the cellulosic category , maybe isn't getting the same level of attention as liquid agricultural biofuels , where , you know , they're really , you know , it seems apparent that there is clear focus to support , you know , those those areas and really lean in .

Speaker #1: And I would say from the cellulosic category, it's not a lean out, it's not a lean in. It's sort of business as usual.

Adam Comora: It's sort of business as usual. You know, I'd say I don't think we're really expecting any real surprises there. We sort of think the cellulosic category remains stable. You know, as I said in the prepared remarks, you know, there could be an upward bias to the D3 in the cellulosic category with the entire biofuels complex. Just doesn't feel like it's the area of focus. There are other areas where the EPA may be trying to emphasize.

Speaker #1: So , you know , I'd say , I don't think we're really expecting any , any real surprises there . And we , we sort of think the cellulosic category remains stable and , you know , as I said in the prepared remarks , you know , they're , they're , there could be an upward bias to the D3 in the cellulosic category with the entire biofuels complex , just doesn't feel like it's the area of focus .

Speaker #1: And there are other areas where the EPA may be trying to emphasize.

Speaker #5: Great . Appreciate the detailed answer for my follow up . I wanted to ask on 2026 EBITDA guidance , would you be able to share a bit more color between your different segments ?

Betty Zhang: Great. Appreciate the detailed answer. For my follow-up, I wanted to ask on 2026 EBITDA guidance. Would you be able to share a bit more color between your different segments?

Speaker #1: Yeah , no , I'm going to I'm going to pass it over . Kazi in a moment here . Now we , we , you know , because that'll also be driven by where we invest capital and that sort of thing .

Adam Comora: Yeah. No, I'm gonna pass it over to Kazi in a moment here. No, we you know 'cause that'll also be driven by where we invest capital and that sort of thing. So we're not giving you know specific segment guidance. I'll pass it over to Kazi. One thing I do wanna caution folks to is the challenging operating environment that we've experienced so far in Q1, and I know there's another wave of storms that's rolling through right now. It was factored into our guidance. But there was a challenging start to the year between you know the snowstorms, which impacts production a little bit and impacts your operating costs a little bit.

Speaker #1: So we're not giving specific segment guidance, and I'll pass it over to Kazi. One thing I do want to caution folks to is the challenging operating environment that we've experienced so far in the first quarter.

Speaker #1: And I know there's another wave of storms that's rolling through right now . And it was factored into our guidance . But there was a challenging start to the year between between , you know , the snowstorms , which which impacts production a little bit and impacts your operating costs a little bit .

Speaker #1: And so we don't give specifically quarterly guidance, but I just wanted to caution folks on the first quarter. I'll pass it over to Kazi.

Adam Comora: We don't give specifically quarterly guidance, but I just wanted to caution folks on Q1. I'll pass it over to Kazi.

Speaker #3: Yeah, thanks a lot, Adam. This is a great question. I think we've got to sort of express this as more of a hard winter.

Kazi Hasan: Yeah. Thanks a lot, Adam. This is a great question. I think we got to sort of express this. More of a hard winter obviously is going to have an impact on our upstream production and likely gonna be also how much we are dispensing through our dispensing network too. For the year, I would say is, think about you know how much of the growth we have seen upstream productions, similar type of growth we can expect. Downstream, obviously 2026, as Adam mentioned, it's gonna be a bit of a more pivoting year for downstream. Most likely the growth would be somewhere around in 2027 onwards.

Speaker #3: Obviously, it's going to have an impact on our upstream production and likely going to be also the how much we are dispensing through our dispensing network too.

Speaker #3: So for the year , I would say is think about , you know , how , how much of the growth we have seen on our upstream , upstream productions , similar type of growth that we can expect and downstream , obviously , 2026 , as Adam mentioned , it's going to be a bit of a more pivoting year for downstream .

Speaker #3: So most likely the growth would be somewhere around in 2027 onwards . So I would , I would stay away from giving you specific guidance , but you can look at our existing breakdown that should give you an understanding of where we're heading .

Kazi Hasan: I would stay away from giving a specific guidance, but you can look at our existing breakdown that should give you an understanding what we're adding.

Speaker #5: Thank you

Betty Zhang: Thank you.

Speaker #4: Thank you. I'm not showing any more questions in the queue. I would like to turn the call back over to Adam.

Operator: Thank you. I'm not showing any more questions in the queue. I would like to turn the call back over to Adam Comora. I'm sorry, Comora, for closing remarks. Please go ahead.

Speaker #4: I'm sorry. Camera for closing remarks. Please go ahead.

Speaker #1: Yeah. No, we appreciate everybody logging in today, their interest in OPAL Fuels Inc., and we look forward to sharing more updates in the future.

Adam Comora: Yeah. No, we appreciate everybody logging in today, their interest in OPAL Fuels, and we look forward to sharing more updates in the future.

Operator: This does conclude today's programming. Thank you all for joining. You may now disconnect.

Q4 2025 OPAL Fuels Inc Earnings Call

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