Earnings call transcript Q2 2023

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Operator

Good morning, and welcome to OPAL Fuels Second Quarter 2023 Earnings Call and Webcast. [Operator Instructions].

As a reminder, today's conference is being recorded. I would now like to turn the conference over to Todd Firestone, Vice President of Investor Relations, to begin. Please go ahead.

Todd Firestone

morning, good and you, everyone. Thank OPAL Welcome Conference Quarter Earnings Second to the Call. XXXX Fuels today Comora With and Co-CEOs, are me Adam OPAL's Financial Ann and Chief Officer. Anthony, Maurer, Jonathan

second today's also those results for to of available financial After results a and our OPAL section Investor the available this are will be website. XXXX The website completion Fuels and for webcast at on released opalfuels.com. the on replay afternoon, our yesterday quarter for call, Relations operating are of days. XX the call of access presentation available

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

contained of of of events any and our factors call. reflect a update our statements Several after not to statements undertake could contribute statements website. obligation forward-looking of in that not could Investor of date Forward-looking the cause is OPAL which circumstances such does presentation, actual our and reflect to date Relations call, in such performance, forward-looking the described are differences section are or Fuels statements. differ guarantee These as or to posted views results is to investor what this our this materially from

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

after operational call results, updates strategic overview today's on results. the begin will update, give and which quarter's providing and an for will highlights Ann will and questions. financial the We'll open John commercial review development call then a recent business our Adam of priorities. by

Fuels. to And Comora, OPAL of over Co-CEO now I'll turn Adam the call

Adam Comora

for results. this being Second here Call. and to from thank XXXX Todd. Earnings like morning, Good you I'd quarter's Quarter Fuels for points you, Thank everyone, OPAL several highlight

First, expectations quarter, operational balance we for RNG year. our continue facilities second continue expect the the meet to our at which in-service of performance to the in

which to we fuel John We also station in and see the segment, out Ann an continue. in also into year further on expect improvement will our playing service puts quarterly the some results. and we takes and go saw our full detail of results

final renewable were the One fuel. we published as very by key set biofuels rule the strongly use and of the This was cellulosic final development in quarter, the rule a which with, supported in transportation June. pleased gas EPA natural

positioned For to DX best the OPAL highest RIN value strong and market. this is years at integrated and least further in business RNG next growing base vertically deliver model, volatile and us less which gives our growing and the X for our confidence end pricing validates strategically production Fuels, economically into

multiyear parties visibility through provide give rule to strong RIN industry also in potential sell but volumes forward targets higher final RIN only multiple of must compliance DX not signal of DX extended years. the be targets production the Specifically, the these targets, X-year These purchased for obligated by XXXX. higher resulted investment provide and that demand which a

just in rule, $X set early DX Post to in the year RIN have the above final RIN $X. under from trading prices per risen recently

$X.XX. second In inventory, sold approximately of average previously our ruling to the up credits we some price X.X prices, million quarter, leading at existing to June. which elected the from the in we RINs sold we RIN With an in improvement EPA's had roughly hold

disclosed release in quarter detailed table press investor our is last more unsold in of presentation in morning. was the our website on this A also sell to prices at our RIN posted third continue available our excess We inventory in night earnings from and $X. credits

than credits to associated of quarter EBITDA environmental OPAL's awaiting and include similar order certification in more match by quarters increased value quarter this in in in in to unsold financials to $XX attributes million RNG prior expenses this our million. is produced. the adjusted the increase $XX GAAP environmental value the The Note, we recorded

However, we actually don't purposes environmental GAAP sold. book until the revenues for credits are

with supportive We're right to EPA's remain which the it they plants believe be chance environmental failed small will highly still projects, to more justify a original therefore, the public eRIN implemented, reasonable some final there's capture to considered, too full being eRIN RNG to is While of make and It be proposal. into may and, rule, methane pathway. policy the incentivize are we the perhaps they modifications set undeveloped.

Fuels, For County, our us of numerous nameplate increase a project renewable incremental our into represents would through construction. MMBtu development Polk moved excited construction. power and additional the transition capital This project with announce those funnel fast and up business also leverage opportunities, successful enables of value portfolio our of growth. own existing development opens which we OPAL smaller We're represents accelerate electricity our we've RNG which it assets million to little to X.X Florida renewable further capacity, into that Polk XXX%. and

is through in driven think quarter improvement fixed what operating cycling normalized to price contracts. adjusted service to pressures fuel some higher Second we station construction and but was third-party forward of construction RIN more inflationary improvement station only our saw cost margins our not results trending projects on on in completing prices, This a moving by environment. EBITDA segment

think time it's expect this OPAL be second to half Fuels. We in great year. the continue to the of a We

and return expenditures, operational should a decarbonize. to capital which on initiatives minimal be platform long-term to tailwinds have nice flow. a to in best strong on capital continue corporate the business capitalize believe is we best from model and cash in add and team policy The public growing to industry and projects of when free end the require what We resulting both built result sustainable powerful

to With it that, over I'll turn Jon. Jon?

Jonathan Maurer

saying are moving development want by focused high-quality executing I to out expectations visible good momentum only our our very on significant products we Adam, but growth forward were production morning, that plans. business. current you, our Thank funnel, and in business on our met growth we're Not and to providing start everyone.

as RNG come the our gas works expert gas gas partners to projects more to recent hand RNG landfill trash quality. in X.X MMBtu Fuel our have At business. and projects team Road, production landfill River we as our projects improve roughly of nameplate to Bend, New solid Pine with increases segment, representing quantity million of our continues These landfill capacity. operating X increase annual to ongoing In operation, collection X in our online, hand and a base provide Noble and

construction nameplate our RNG business. I we These this be is portfolio million construction, project representing provide would RNG projects our addition expected an visibility quarter June growth third during currently to for highlight In to added projects, the operating completed X.X near-term of have to commission. annual as in additional MMBtu completes construction following: and project projects capacity. to our First, our Emerald in-operation X underlying the in

and Second, MMBtu as us. contribute County, Polk X.X by Adam portfolio. project nameplate mentioned, we annual construction added million [indiscernible] XXX% capacity owned is This Florida of our will project

XXXX. We to in QX project expect the COD of reach

shift construction some to gears of projects. want and our the I process permitting discuss on

permitting at and due Emerald, some process. projects Prince experienced large our have delays R&D William Sapphire We to in part

of In to First, that ultimately not a these dramatic when online. will experience, of projects come whether matter if, they reflection delays are our in harmful are and given the stress emissions. I not the want a decrease

place we formally a project a not all obtained construction construction. contract be and when Second, permits signed to are required into

that we processes completing these the schedule time note local varying are agencies. this for to to particular While reasonable it's important state and frames permitting,

In of project. municipality of time many sanctioned these first an the practice, RNG projects are has

process anything despite new, takes the earnings these sometimes remains to So it's The get the several of longer than of over here line. it expected is months projects a power intact that it with new takeaway delay. the and

project now William of to expected be is online first XXXX. Prince quarter in the Our

Our be to we projects of the to dairy and in X in third half Sapphire quarter the project is first our online XXXX XXXX. California, of in commissioned be expect expected

below and William, volumes at be months we delay XXXX several modestly guidance. the expect the previous year to at Emerald or our Due to low end Prince production full

development to on pipeline. advanced our Moving

target at we a Polk we construction months. expect set XX million putting hit least construction remain in MMBtu of to over progress. majority qualified goal. dairy and year. goal, will With halfway contains million capacity advanced in that can in of We towards our in pipeline. We project. MMBtu across be projects are that the we we but our nameplate construction, County encouraging March we in within waste and of now We X.X the have The reasonably advanced projects continue these also now landfill ones have make food development development XX to Remember, is this next pipeline and optimistic are that XX X

pipeline development include stage earlier not does advanced Our other projects.

of mentioned and larger operators integrated to have new as on aid we we us seek projects. As our continues prior experienced are in platform discussions the in and this we space one out calls, more

our Services business. Station to Turning Fuel

believe normalized and to some have more to through inflationary mentioned, we we we cycled expect the As Adam pressures, of cost margin move trends.

being and ever of happens, before believe the it result large We positive We have XX-liter for new engagement like timing but seen Cummins national and fuel. accelerating and adoption fuel. tested which station await on than clarity continue on will it a RNG deployment very of and service and else the for everyone RNG/CNG, rollout deliveries construction, in the as hear require interest to more engines will fueling new commercial fleet new when feedback and transportation RNG trucks,

and and position fuel OPAL in to model puts stations to this building servicing growth. on Fuels our a of market the is be in choice capitalize and potential leader vertically a provider new strong us integrated

potentially projects has Besides currently to remaining We the of on to capacity X projects proposed from from RNG await the in of X are continues benefit eRIN Currently, this projects pipeline topic under XXX.X as EPA and updated Power the are electric guidance from XX XX this stand The good to pathway. projects stand conversion projects, advanced to Renewable serving to of eRIN development for projects converted nameplate converted being and that provide to the be optionality. in these process Our electric others year. pathway. proposed facilities can these benefit construction representing later an RNG RNG. of segment megawatts inventory

Ann. Ann? over turn now call to will I the

Ann Anthony

filed end biggest next and we Last driver final we We the in to quarter near you, days. June in The good environmental the night, inventory. higher XXXX. pricing, period release the of results held the start quarterly quarter's were Thank detailed morning, which the XX-Q of filing earnings we press anticipate of after rule our our XX, Jon, couple attribute results for which was the credits able and announced set was EPA's moved monetizing ending our everyone.

was impacted this was income shortly. of Sapphire projects, Emerald our million $XXX.X quarter, we'll the Net and but which deconsolidation discuss by

$XX.X Excluding costs this loss the approximately the of result as of station $X.X million, onetime $XX.X higher gain, was G&A forward ended second quarter second of year in abate. months XXXX, the we prices for the with the our days for XX, totaled XX some adjusted end $X.X approximately construction started impact of pressures X plus million compensation, unmonetized with with to $X.X net normalization RIN compared some that of mark-to-market June million June, quarter million. of second stock-based primarily last at of total that noncash. included the was $X.X credits million The first adjusted sold our which along We last million quarter. in we a experienced the difference for quarter the reported projects in the the and business the EBITDA is services of in fuel move inflationary

the the deconsolidation the Second end and onetime down. could is does marked gain quarter projects. and or fluctuate associated Emerald should value EBITDA the such of unsold Sapphire up of with quarter environmental exclude noted at that It the as onetime adjusted be our attributes value items,

our owned As resulted we disclosed mentioned, deconsolidation projects. June, LLC, and Sapphire GFL I which between RNG in a of and Emerald just formation in Paragon the Environmental, of RNG XX-XX the company OPAL Fuels

and venture, more under about with We of X We'll moment today joint in talk deconsolidation RNG the XX-Q. up projects X forward additional our and projects. in to move impact have in expect a construction this to

improve were million XX.X results our second dispensed quarter to XXXX. and higher quarter We first compared able the of move closer of in rest as This diminishing to for saw revenue as projects inflation in the In the dynamic Fuel recognize segment, the helped from construction to Station Services should as year. quarter we improve continue GGEs well impacts which completion. cost margins, the

of Year-to-date, landfill was that we due impacted end shutdown primarily compared quarter at a gas RNG to fuel the $XX of quarter, out projects which own Power, our a of In Renewable to decline one by project saw we we've projects. on reached Year-over-year, we the that unplanned to had and sheet. sequential XXXX balance as third life. saw in spent the downtime first improvement to build million electricity continue CapEx in of stations we

As $XX.X investments cash million, This cash plus including of million at XX was million, of facility. under of investments secured equivalents and million June restricted cash in maturing cash short-term a March of liquidity within $X.X of of term equivalents and million, senior $X.X restricted in XXXX, days. $XXX short-term $XX million cash $XX consisting XX, XXXX, XX, and of $XX.X million million $XX.X consisting cash $XXX including availability of million compares to loan and

facility date Paragon of and the the facility Paragon amount with and no projects. assignment cash the part the the the and from $XX of Sapphire cash up credit assignment. X-year term cash under There maximum assigned that was excluded to to remain principal reflects result that of of the deconsolidation $XX.X related both term of to credit equivalents, as to facility deconsolidated of delayed of a existing cash a driver was outstanding facility in again these is for and projects. million. reserve projects, also the of debt deconsolidation. The available a of now to reduction the again, $XX a reduction primary funds million loan was the consolidated liquidity This as Emerald is Note, of million the as debt attributed this these available and senior

flows sufficient our with anticipated needs. credits funding to and believe that environmental value meet We including unsold be our to access associated will our liquidity, cash sources from of operations, expected the existing capital

financing structure include additional basis. an pursue higher development to our financing and in to structure less streamlining on continue pipeline capital the individual capital project We up for advanced funding our and

I'd like $XX prices million strongly realized $XX targets rebounded implied current prior to XXXX we to since above RVO prices, provided higher the RIN reiterate price expect year be EPA full our our now and that averaged our have RIN guidance. prices guidance expect adjusted EBITDA at the to range. the $X.XX we within in quite to million move

William. expectations. low projects operation Emerald at be of However, at and as guidance or in as well Jon noted our the The production that line modestly segments RNG earlier, that in other below as the given we will anticipate delays end with continue are and well our Prince business to perform

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

Jonathan Maurer

Ann. Thanks, significant the business In is warming OPAL want issues. that remind closing, Fuels X to most addressing of global everyone I

to drive we gas industry which displace methane benefits gas significant the resounding furthering solutions reliable EPA's We to market fossil and best-in-class harmful collecting are RNG increasing and cost-effective remain benefits of facilities fossil industry-leading, mitigate We to to committed operate change. the the and These OPAL's what tailwinds, build are that fuels products. climate the IRA using and continue mission to are impactful fuels. policy for from build the deliver RNG vertically to demand our the and to displace in support this integrated

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

Operator

Instructions]. [Operator

from with question Whitfield to come Stifel. line of the is Derrick first Our going

Derrick Whitfield

projects. RNG with on several progress the of Congrats your

in to the For first my your guidance XXXX prepared question, on EBITDA focus I wanted [indiscernible] remarks.

production is that your XXXX and we're a puts stronger of reasonable the still the seemingly suggest now While RIN to upside your there your RIN of and the combination materially pricing conclusion? are timing experiencing plan, guidance. inventory there Is profile from and versus certainly production standpoint takes and volumes,

Ann Anthony

we again, coming guidance for remainder the by your the And and there, again, your to of though the account offset we support. look we we think, where year, for what And appreciate this year. the we the Derrick, question. Thanks, as in I strength is to at RIN happen production and DX point in expect it into out see take

reason, is. think So it we the comfortable with I where for were that guidance

Derrick Whitfield

your capital outlook. to liquidity a I on and spending wanted Just follow-up. focus

the perhaps inclusive on understand over highlighted you capital your time we CapEx ITC, As about backlogs, associated the and the few ADP think quarters elaborate liquidity your on as you're profile in-construction project of could us and of if Page sources help monetize and advancement next that frame. of to how over able XX, that

Ann Anthony

Sure.

and starting the million, to step So We've I over the think at right? construction spent is in in tail of one of we've as if that Emerald $XX quarter We're you CapEx, the quarter. construction. ramp [indiscernible], middle roughly where year-to-date, projects well And first terms if [indiscernible] you commissioning is in guess you step and back in and put XX off. We've down, [indiscernible] the construction. back look second about just into to completed are starting XX

put And you ramps not again, into of up as to and lot construction it a beginning, ramp up. construction, it in as the you're then money starts spending

that, think smoothed out. that we So

think the X I months you from look and expect to into 'XX, we an we I be told perspective, as in of middle we what CapEx the think overall out remaining the over $XX relative And of delays originally [indiscernible]. kind then from from kind seen, a But million-ish it so into $XX perspective. of impact perspective, factors range a guidance that pretty quarter-to-quarter, again, all [indiscernible] seems million to good. also we've again, right

cash the flow liquidity, value on to we that over [indiscernible] terms disclosed coming part as and million In roughly the of monetize again, as as sitting sheet of expect on yesterday, from XX, we capital able we've June balance got and we of were months be million-ish of to $XX operations. $XX-ish roughly

part of be the that again and GFL the also available for remainder still debt that and for Emerald transaction to used do of we the have as Sapphire. us facility amended We can

you imagine, look bankers again, feel As under talking is to goal we are pretty frequently. pretty the well that that structure. in capital as We've at remaining [indiscernible]. can financing we access said And our up availability about to higher facility our as good

circumspect been is to associated via ITC that haven't the talked able about piece we've amount, we William, other year well. that it's when again, this being pretty about we of monetize but 'XX, And transfer whether potentially Prince The able that or and on being anticipate again, total ITC. Emerald do year comes as monetize to this with depending at the beginning the online,

So into we're business we're and our comfortable to say this continue [indiscernible] again, to to it the CapEx around run kind ability that's all why able goes of fund and and grow.

Operator

next going is from of Ryan to Our come line with the question Sandler. Piper Todd

Ryan Todd

timing Great. follow-up on some flow. cash Thank of I come did mean, -- in then Emerald on gas the or look quarter. ramps of there of draw And a Any production parts comments walk I you. have as Maybe business commentary would that you to through on of the we about year-end? quarters? about coming quarters mean talked through can the how that there of us you kind some cadence monetization, obviously, of think online that the the credits. and should monetize How When as your the of Emerald? cadence this you you balance monetization from coming over inventory RNG the down

Adam Comora

We'll RIN we're Adam inventory is about our here. ITC about start for Yes. the Ann Well, and thinking then and maybe let how little I'll the bit this monetization. a talk Thanks on question.

Ann Anthony

with from within we'll well. Obviously, Emerald. anticipate again, XX-XX to would an hopefully guess But on that that half monetizing that as because ITC it quarter to in perspective, monetize be I be extent comes we it's anticipate able ITC a the our associated we project. QX, Sure. the do

Adam Comora

begin viewing and were hold Adam, about is half a RIN to we We going the on been that positive strategy little questions rethink And the some perhaps they're unwinding of market. credits category treat as and how biofuels. you're our being the first as to how on will play sort the DX this done our expected we're for biofuel the inventory rate bit as additional sheet. and we out had outcome sort cellulosic saw episodic of maybe of we talking having terms a of that out cellulosic at holding their And in did targets we to monetization the of an offerings anticipating of some on balance RVO EPA

less this DX for balance think the of future multiyears, top the results to was year 'XX in think pricing, lead frankly, out of the and we next been and But is onetime the 'XX ourselves RIN having for quite market to of now years, not continue the We way that healthy think We over we and over 'XX. see visibility. over going we of higher much don't RIN time we RIN 'XX to market see as and have out start the be by providing 'XX. really our will in a into the in which RVOs think really balance look is sort the should and set GAAP that X and to And the prices industry as DX 'XX and smoothing actually the balance the volatile. volatility into

Ann Anthony

storage gas through I'll Emerald certification in assign X current months comes we It call it, with adjusted equivalent be call part the EPA take, of once does EBITDA. well, to to the obviously, and X, that able as the we generate associated X [indiscernible] just under process once value able steer that with credits to actually are those the rules, And critical reaches, as to commissioning get during RINs. of do it it, monetize period. to online gas add

pending under the just virtual in will actually that year storage able again, there delay want little online certification. is put go and to a that that recognize I the any way you be next are actually real you in that significant start currently everyone not rules a EPA that by So to when to promulgated between Obviously, bit revenue. potentially changes of gas remind

Ryan Todd

station Perfect. That's very helpful. margins. And to fuel then gears maybe the changing

what the clarity color you this little going drove that of right maybe about some -- a the the little talked more terms that fuel of station You is out? about think could a is all in on there. and margins on we of the improvement margins that we more But as this quarter, provide drivers kind improvement forward right of, saw modeling maybe run rate the

Adam Comora

quarters, here. Yes. X as This is And fuel Adam I service different mentioned our there's station previous segment. to again components we think our in

We have a complete. construction typically stations And turnkey where business under building can XX stations take or to we're those contracts. months so EPC

So we do that rolling have lagging did pressure its business, now which run inflationary have we believe through cost course.

We our also have some RNG marketing, business with business in that's our fuel associated capacity. station dispensing

margins also full And have rising we credit but we've do margin benefit also are. prices, of has in the think some to ultimately go where And that we've good going think business going continue We're to margins got there provide think of which we business target upside well. there are don't service we we gotten we there shake we of normalized not that out. to little to it. does get a terms the and [indiscernible] where that, still some think think endpoint as our to And

Ryan Todd

From it the is that? -- Or terms within component buckets, to going the here, biggest still those RIN other future is of tailwinds those. here, is gains in potential -- guess, price, I within there like the more I mean, be of that is X from

Adam Comora

service some that later questions But engine see could growth the we the here. rising growing we XX-liter is station some on on we'll and of get by volumes, upside also not means have fuel to way, only dispensing potential and And it's segment. some where be pricing, and in our a LCFS I good This that of market. what know specifically California out exposure our what Adam

segment optionality through some kind actions [indiscernible] our as also that that think and So part to of taken on may some so the more [indiscernible] there's California come to move that be potential in future. of we we that interesting dispensing maximize

Operator

question from with Martin Rice is next come the Malloy Johnson going Our to & Company. of line

Martin Malloy

this eRIN ask Could I assuming that the you for there's pipeline? pipeline? wanted to of move see Would that talk eRINS later for about how outcome advanced out pathway projects to about expectation a impact year. the little start a might into maybe bit are that your positive development a there, advanced your smaller and number we on development

Jonathan Maurer

smaller, Hi And Martin. much. promotes is question. eRIN pathway the of these well. collecting about it, so The as thing Jon policy Great more here. it I -- difficult projects great the think that gas. supports harmful Thanks the methane really

a significant value to those electric being You provided see projects.

for that's business bread landfill growth and pathways years, the XX really pathway really electric as monetizing the that coming XX avenue legacy so landfill the So and projects the and developing our us. to whole we of we cellulosic other opens to our addition development We've or new that projects project. attributes in electric see and think our operating really and been that eRIN and electric it butter, a eRIN for stand back of the through benefit an of from pathway, up for gas

do sector. expect [indiscernible] more significant that our do building in we'll and we we look be benefit. expect portfolio projects growth We that the will that forward So existing to in

Martin Malloy

those for alternative And uses a follow-up RNG. on just for question, the

you competitors intent e-methanol. a pathways? talk maybe these Could had One of announcement other your some of regarding for letter of about recently

Jonathan Maurer

of are that a think that lot I pathways there's developing.

a see I think see is certainly Europe, We pathway in the Europe developing some with e-methanol U.S. in the in and prices attractive. competing of prices we the

the However, of to electric both continues be as CNG, growing vehicle in the a terms it. as strong RNG the for market transportation fuel fuel market, market well

our tailwind and of So just definitely more for another monetizing there options these, more for value the and be that's business. will

Adam Comora

Adam. is this Yes,

follow-up It's really Just interesting. a there.

the biofuels. food was at versus in more is There's we're can focused And just not here Jon on what methane here everywhere no fuel we debate. about really policy As agricultural OPAL talking emissions. before, how out it's public where doing really not it's emissions. Fuels are figuring capture is These harmful [indiscernible] U.S.,

build some for of gas attributes electric still those landfill are could new to green the the perhaps time sell electric you looking and we're projects of to at these developing even So find it. take when there and facilities markets pathways where all electricity, new

coming other markets pathway policies through. We So other it's as additional new some electric could to of on dependent value think to landfill gas projects and be eRIN new not just these there develop.

on electric potential of we're So optimistic some projects. these

eRIN obviously, be there developed and other but the to The close front center, pathway, as is can that well. things get

Operator

Grippin next of UBS. our is going come the to And line question William with from

William Grippin

Great.

Just eRINs what the a hearing could develop. But specifically, here. topic more how the structure elaborate wanted on wondering obviously you could I could somehow drive circle bit came before back the of previously fears around maybe that concern? a to that oversupply program if program on And were could some that final know that, mitigate RVO of EPA to you there Do think out, you're DX.

Adam Comora

great make this how right we're of say, not industry just policy, capturing and disrupting the question. key there the right early with still make in those talk. the industry -- on And those This still in out. as again. as Adam we're on that market Yes. a you're still And aren't can working rolls is early and is conversations, is about gets look, now, That's unintended we it's what from the of that right, implementation as pricing that one sure and was exactly of way, one to messages the that down not let's the EPA by developed. that sure of and methane drove eRIN look, was things And RINs the program gave And we're the harmful back was consequences that's the the the just that much was rollout that the to happening. how is conversations that

-- there in So the is still could early early discussions. or still those industry we're on on so be

let's sure to get to do that I trying structured RFS, work earnest a this in way balance that, sure new in that's to capture happen is with and we're development original continue going EPA of is continue of which to to provide projects methane, to exactly investment to hey, the to make think year. they're and in to the new developed and in the framework is And over policy the cellulosic strong continue works, sector. intent promote make do the happen the what that biofuels

William Grippin

other projects do that you to And deconsolidation result Emerald, or recognizing as Got it. the knowledge the that with working to of that just a forgive GFL the on then GFL Appreciate potentially the back of them assets, that here, color. my follow-up, EBITDA you're from on? project? just could as but a of does impact going of also, amount deconsolidation of require curious, change And lack accounting this you're

Ann Anthony

Sure.

they'll I'm for accounting doing say front, is going all there's lot this you be we've but of the GAAP We've of the GFL, JV. to additional relationship a to that X question. with we that this up for complicated obviously, into continue thank we projects X anticipate reason anticipate. right grow, just got the And part goes our this. got Basically, that So projects do And because of that will today right?

on now guess be show results as right, GFL's GFL this now have let's up all opposed revenue, to both will stand-alone affiliate. adjusted think as I been a its operation, way So EBITDA, And we portion continue neither the way consolidating of entity that us would and income results. through nor investment cetera, equity into say, consolidated would the OPAL it entity from revenue would Emerald, backed the right, basically, flow that about for us, down, P&L, as et becomes flowing pickup, right, flow for out. comes in through will statement an equity once to as

if back, to and to flowing right, EBITDA, So comes still equity opposed as through then pickup it's a answer from we get [indiscernible]. saying and long the but it add

Jonathan Maurer

the [indiscernible]. And magnitude

Ann Anthony

equity business. up we as include our Correct. And a at it the you're just a space think to again, us justify That's part relationship business, how I this be is correct. of that grow, But this demonstrate it part up able a in to continues think, top it meaningful of have point, this sets but your as of you done actually others truly to previously, That's not to kind onetime and -- have revenue a becomes that earnings. the of part event.

Adam Comora

were the just there. Yes, has XX-XX summary, this in a JV, basis we Emerald. GFL with no both to of change is changed around there Previous on was partnership. original Adam. project XX-XX partners for Nothing and for to And Sapphire economics any this the

no and EBITDA, change, how So more JV set And do those mostly the projects to to adjusted are was up the together. no run. change really being grow

Jonathan Maurer

joint cause add, this. or me venture. us us results just this This do make didn't let from the And just accounting is GFL

William Grippin

appreciate I clarification. it. the it Got turn back. I'll

Ann Anthony

commercial of the kind do a the a you the mean think, growing but to I like better where say way is have just reflection, what between is accounting I here. it firms relationship it's accounting two fact, to the of after drive did us

Operator

Instructions]. [Operator

from question line [indiscernible]. of going Our is next come the to

Unidentified Analyst

pretty point, any you concerns on supply Or And at into guided issue? So you how much as a timing? as think projects are the confidence do far previously first as there this times? permitting delivery is your all far the outstanding chain about had XXXX on that case-by-case as delays, project

Jonathan Maurer

you question. Thank for your

pipeline. our these that touch construction execute ultimate any There's delays. in permitting of authorities a and a on few permitting of the permitting the other the ends it substance in would during is other are projects, oriented. doubt value particularly there construction. We as but odds I is not continue and substantially Like in to number delay that We're RNG, to say companies on projects of these issues,

it build time level each The so we of comfortable those do group a all a get very frames impactful very of as And and ultimately, that earlier, and particularly and product, in we provide various they're this scrutiny individual degrees projects is but permitting see new experience, with Typically, reduction authorities [indiscernible] will questions. its that with emissions of the but have and they RNG. authorities really said I for with own RNG ultimately locally of local attractive. these in deal

the whereas in took but project, it, have it in with us little the June, permit just I on started to Emerald July. started probably example our be time permitting would the early terms there phase, we in This bit completed really we in get early started commissioning good been more project. construction authority of think it June, earlier commissioning commissioning started final a a have on might might

uneffected in, as we So again, with, you we roll And feet [indiscernible] deal power try a try are to when we XXXX. business in of through these types out of nature. are to we'll big and our picture standpoint, business, build at as to XXXX from see XXX,XXX continue and those look delays projects our but small go there's relatively

Unidentified Analyst

operations on the question. William's Paragon of It between question Paragon of now construction CapEx speaking have on gross for to And CapEx spend operations. got digging balance a sheet versus spend and your a your what seems Derrick's separately wholly kind liquidity On or projects? go-forward capital owned do portfolio, we've you like separating proportional requirements little out basis, and in you on JV domiciled and liquidity or consolidated plan

Ann Anthony

from So XXX% asking you to Or project? reporting are things are versus of separate Craig, break for JV of facilities for going we asking you are the purposes? owned just perspective more it out kind

Unidentified Analyst

GAAP about looking out terms X year less and next talking or I'm outlook. over the reporting requirements in of than CapEx

Ann Anthony

Got it.

Okay.

perspective, relationship think a I right Emerald I it's our from unique It's Sapphire mean So we a is think, based I due sit GFL, growing. and right? the where relationship now, with one, on and to large

that a took the we relationship. So evaluating actions as of right, took, result we that

what it but be we there opposed a projects continue do with in would off Based either, we this on XXX%, we have I see. in don't the to with now, that right to GFL obviously don't similar happened we be think we I took projects we that to I right? that have partner. thing envision those we are ADP but the where also group that would where a of relationships amount sit point, again building know at interested

want benefit you behind economic and to you do what ultimately to commercial maximize have and scenes you the relationship the to support it. the Again, do

Operator

further time. the And no to any back remarks. And I'm like to further at for Comora this showing I'd conference turn questions over Adam

Adam Comora

and in hope OPAL and great day. a All today, us right. Well, thank you very we has much joining everybody Fuels for your interest

Operator

conference participating. call. Thank for you today's concludes This

disconnect. now may You

OPAL Fuels (OPAL) 10 Aug 232023 Q2 Earnings call transcript