US refiner Calumet said a $1.4bn federal government loan to help it boost biofuel production was among the billions of dollars of federal spending put on hold by President Donald Trump.
In the waning days of President Joe Biden's term, the Department of Energy (DOE) closed a $1.4bn loan agreement with Calumet subsidiary Montana Renewables, which plans to more than double production capacity at its Great Falls, Montana, biofuel plant and convert more output to low-carbon jet fuel.
The company was due to receive an initial $782mn loan, with the remaining funds disbursed as the project advances, but Calumetsaid this week that DOE officials said the first tranche was delayed so that officials can confirm "alignment with White House priorities." An order freezing tens of billions of dollars in other federal spending issued this week was blocked by a federal judge and then at least partly rescinded today.
Calumet declined to say today whether the administration had provided any updates. The company previously indicated that the Department of Energy estimated the delay would take "days or weeks." The Department of Energy did not immediately respond to a request for comment.
Montana Renewables' Great Falls plant currently produces 140mn USG/yr of biofuels, mostly renewable diesel. The planned expansion would allow the facility to produce 300mn USG/yr of sustainable aviation fuel (SAF) and 30mn USG/yr of renewable diesel from vegetable oils and tallow. The company said this month that it expects half of that eventual SAF capacity to come online in 2026 and to complete the project in 2028.
The Department of Energy's Loan Programs Office, which offers low-interest loans to advanced energy projects, was always expected to be a top target for a new Trump administration. The Inflation Reduction Act gave the office an expanded mission and more lending authority, but Republicans have long argued the office supports risky projects.
While companies that had only received conditional commitments from the office are more likely at risk of never seeing federal funds, even projects with final agreements must meet certain commercial and legal conditions to access full debt financing.
