Vertex Energy (VTNRQ) 9 Aug 222022 Q2 Earnings call transcript

Good day, ladies and gentlemen. And welcome to the Vertex Energy Second Quarter 2022 Earnings Call. At this time, all participants have been placed on a listen-only mode and the floor will be open questions-and-comments after the presentation. It is now my pleasure to turn the floor over to your host, Noel Ryan.

Thank you, Ali. morning. Good Vertex XXXX to conference second Energy’s welcome results quarter call. And Chief Chairman call Strategy Ben and Rhame. today the and Officer, Officer, are Ruiz; Chief Leading Carlson; our CEO, James Chris Cowart; Alvaro Operating CFO, issue detailing recent morning, We opened financial our press the operational release market a this results. and before are that company’s commentary may which statements, include responses to uncertain outside questions the to nature of and like I’d management’s on remind control. forward-looking by you and today’s call their conference

based are results statements Although management’s current actual forward-looking these beliefs, and on could expectations materially. differ

of discussion of the risk For Vertex quarterly cause could results section the Factor differ, some Energy’s to the refer with factors annual and filings that please latest of to SEC. Risk

non-GAAP release discussed the call And Chris the from review Additionally, I’ll these call over on Carlson. today. our issued Ben questions. financial financial at that, measures the line begin can please Cowart the note, you with Ben. the press during from turn for And with call find prepared open Today’s will reconciliations by remarks to remarks, we’ll of followed historical conclusion of

overview you, which our refinery, Thank morning. today’s level to Well second to assumed ownership from we Good which Xst. call quarter high a quarter April Welcome began results, of full include with Mobile a call. contributions Noel. of the of as

by million, which mainly energy period. in generated refinery, consolidated record million adjusted supported adjusted from acquired we of the complex during During standalone a period $XX.X broader the $XX.X for volatile second quarter our generated EBITDA EBITDA Mobile contributions recently

reduce narrative fuels Since expectations. to market. the local decisions capacity conventional markets same in both continued quarter, that out for resulting margins. tightness many of playing we’ve in have a of is for by capacity, spreads areas elevated regional acquiring legacy time contributed to period, shortage a in also assets during domestic refined and sales, the remaining supply Our upside with well implying given inventories in the and competitors second and performed product five-year legacy recent EIA the product remain product refining average, distillate healthy, our cracks. across structural have re-refining gasoline capacity below so refining strong domestic collection At demand to trailing further Marrero business to according country of Heartland in and near while well refinery, product demand end similar the operating We the believe both the volumes potential experienced exceptionally Mobile UMO the outperform

at was excluding jet XX% just of During Total finished $XX per light which than and under spread a Throughout our the sweet of day, total represented production per in per approximately high-value producing light gasoline, the in day the X/X/X crudes. the a and local profit loss second quarter process and gross more barrels inventory -- LLS approximately between period. hedging guidance second or realized per of in includes adjustments barrels barrel, XX,XXX fuel we quarter. of WTI, production benchmark quarter, was XX% and the operable operated barrel the barrels capacity, XX,XXX Mobile Total XX,XXX second which second per ahead day. of Gulf combination products, Coast distillate light of quarter, the crack XX% for

and above XXX% declined fuels, quarter supported the levels while remains July, conventional than more the sequentially During third in quarter seasonal for second remained was market favorable, versus conditions strength has X/X/X XXXX. by --

XX,XXX per third day at between we day market. and XX,XXX to intend continued on operate in barrels During the to the capitalize positioning per barrels us Mobile strength quarter,

Mobile renewable ongoing project Turning refinery. the diesel now to a discussion of the at

of construction to fabrication pipe project. the quarter, we foundations of second and begin the During the related

equipment lead the having issues teams supply successfully challenging, major remains orders the continue to these long navigate year. in chain on earlier our While all

As oil the the project time. of on to a cash expected entirely trending production project committed the to $XX fourth of within believe during quarter come our million with XXXX. engineer impact existing to guidance, Mobile are be million, on a to planned initial we have planned first forward. this refinery funded flow move October million on costs this the hydrocracker budget unit have And hand as shutdown consistent XXXX. expect cash of to range quarter and renewable volumes through before diesel In at we are XXXX, at we the expect $XX $XXX we We and by no stream will from shutdown rates previous total in crude operations. Today, to throughput

Before the results reported a share to question. our few comments allow Chris, over this around call I turn me No quarter. to

beginning quarter at prolonged it, upside and kept XX% QX noise inventory when and had made this not realized remained product elevated the full risks, chosen a margins, a higher. of series downside enter hedge planned period It XXXX, spreads during of few of one Concurrent hedges crack, unrealized refinery, our QX a position us third our with designed in safe production levels. moved With to behind into was advantage losses. at together fourth expectations hedging the quarter mitigate the -- of period second take year. in with that for including we elevated to expand The us, market Mobile acquisition while full historically the spot the to during a spread past a and some both quarter concurrently quarter we refined in program decision what locking bet, the our our of have of bet of

refinery, proud ensuing entire of our whom people period integral across role record plan continuing our to team, second value successful drive exceptionally our our played efforts of creation the in integration Mobile results. a while executed an business. each transition, on of legacy I’m a quarter combined the of During of

balanced RD ensuing on; Looking three, safe Long-term, of ahead, reliable as strategy. fuel aviation we use transition superior conversion; emphasis operations; period where to sustainable we particularly delivering energy our intend we the diesel producer scale. we solutions, the can regional an exit as a driving and up conversion, continuing sector leading will which remains we focus in and upon cash next-generation a strategic flow opportunities; of create decarbonisation organically biofuel one, to to pursue in four, attractive become one an believe on to continue two, platform CapEx deployment the One Vertex of heavy plan to invest high-value renewable fuels. advance renewable leading a completion with a opportunity overtime an capital

trend such as the Inflation we of Tax extension incentives project towards future passage pending the Act, Credit Reduction and tax multiyear of With the the will Blender’s economics. support a that see positive visibility

and a our our We their an exciting the Vertex. time for industrial for as trend to the continued support further of business. and fuels align from shareholders customers renewable demand also I’ll priorities see forward Chris. evident With commercial appreciate companies summary, us business with that, environmental seek on towards responsibility. it’s We partners, here call accelerate the over look to hand at building customers, to momentum and across In the

the those joining And welcome today. call on to Ben. us Thanks,

net ended months loss loss XXXX. net XXXX, the For a $XX.X June a versus quarter million of three second in Vertex the of reported $XX million XX,

generated realized intermediation includes together million commodity on a $XX.X quarter agreement other $XX.X basis, a to $XX.X $X million. million derivative million net in with backwardation, commodity and million second $XX.X a The loss expenses. adjusted $XX.X due the a non-operating versus year record loss, refinery unrealized derivative transaction We second the of million loss, in the Mobile an quarter non-recurring EBITDA standalone prior $XX.X reported in XXXX On million period. loss

Second financial Mobile quarter from a on acquisition, contributions combination fuels, from the full results conventional refinery X, product which elevated for robust closed of of strong refined and operational demand first April XXXX. quarter margins the including benefited reliability,

lease $XX.X of XXXX, November EBITDA million Back adjusted shares cash of trailing $XXX obligations. The times million XX, million contribution total at underlying of debt XXXX, which total XX.X end As X.X of notes in due one quarter as including from on million of cash implying issued $XX.X of debt we restricted second of the convertible XXXX, quarter quarter had net includes X.XXX% including of of X, only and Mobile callable million or the conversion. Vertex conversion company are $XXX finance of at XXX% XXXX. per the exceeds the or after price These end stock ratio Vertex the XX, to had June on of share. June notes outstanding net on the XXXX, the $X.XX versus by refinery. was EBITDA if October XX-month second full X, price XXXX, XXXX

million. noteholders the from the million approximately the converted approximately Vertex outstanding note During common into voluntarily million of of quarter, to XX.X notes $XXX million $XX their of convertible second stock, reducing thereby shares amount $XX

the an a interest amount million had to $XX in we the structure. our third operator of OID of acceleration within quarter conversion the from and remains Capital’s introduced term $XX the in million Myrtle to Grove the Vertex assets, XXXX. we this assets due and refinery million addition, guidance legacy In including to impact our this Also capital financial Heartland $XXX using statement upsized proceeds quarter, repurchase Tensile and income At incremental XX% to simplifying outstanding juncture, Today the owner and million, the during $XXX the non-cash loan expense. ownership legacy sight. further certain of for operational sole all

is of subsequent current provide quarterly guidance Going of no the guidance and All subject time forward, a we as should is All relied level to to calls. guidance be provided similar longer expect financial prior change. upon. on

barrels total at quarter million. and $X.XX of the XX,XXX throughput expense third per consolidated the of the operating XX,XXX $XX the capital following; at currently Mobile and between $X.XX And of between day anticipate of barrel XXXX, we expenditures per refinery $XX total and between refinery. Mobile and barrels day million direct per For

consolidated For the between we $XXX anticipate million that, currently Operator? and With will expenditures the year questions. for we total XXXX, line capital million. $XXX full of open

[Operator Instructions] Thank you.

with Manav from your Please coming is question Credit pose question. Suisse. Gupta First

guys. Hey,

associated we at point third or in these should quarter they think the at of to to just the lot in should about moving in as trying How this losses So of themselves a that look losses think lot XQ, various relates a obviously did hedge in And XQ, that -- items hedging hedges with time? of obviously of place. be understand a we XQ kinds kinds of we of should lot put you and noise about replicating I’m lower?

Yeah. Thank as complexity hedging to the -- add. a earnings. as I’ll quarter obviously, got behind our create of put you we production half you, of lot additional follow second on let production the follow me Chris -- if in that something he’s of in But, Manav. up indicated, kind the

quarter our financial number in what see $XX the think around for is second results. you I the to impact million

third the quarter. the that So in the accounted both includes hedge that quarter we for for the and allowance second accrual

seen So, improvement have position that quarter, million and follow a market. the probably, the the hedge we we third $XX to an so in anticipate for continuing

relates So in can the definitely trying forecast is, is. is it on a to depending But to-date, quarter are difficult, the for situation. third hedges very those to what I the outcome quarter outcome we better as say,

it’s say, we complex went into prepared lead hindsight was monumental had converting transition energy through site, look we hedge not had take responsibility good, be crack that the still like to hydrocracker we renewable the an for I’ll shouldn’t a But challenge transition, do was we back, timing to by a in did. and very for So to long-term of a have well, strategy XXXX easy knew do. we a platform, as acquisition, We and to fuels. that spreads us to that

bank, the so closing, put less, of safely seen set we a we the And or end spreads quarter strategy historical we more decision precedents for was develop the refinery upon was over crack it premium as crack early, at XX% five-year March, would spread, the that no for made us purchase there the the and a of kind take the that up second over a in company. a and long-term it of time, real at amazing. that And

and business everything but have the very I’m that in shows cash potential the how long-term bank, to is the love for the platform the transition have, with the we just thankful certainly the well of it executed, So flow money business.

-- we back. we don’t so And look

that think figure But We’re not it’s it’s a good material been noise try I long this know a be answer. going a press I hedging the know and was quarter -- has in to to at that explanation. moment and I the out.

you thank So question. the for

is, that guidance. a on And did quick you up, here obviously, have follow last quarter, XXXX

your then renewable we go XXXX, we’ll obviously, obviously in have you the think running. So and how earnings in the will diesel should year as of power Vertex, about XXXX, refining XXXX and be we project basically first, up

and of it can achieve EBITDA XXXX there. how you XXXX? I’ll think So you of think Thank in we you. should some And kind leave that

we if quarter, second quarter, million have crack the Again, looking you. flow are for the $XX EBITDA actually forward the second another Thank talking third Yeah. about. hedge have be didn’t going at and of would cash quarter, been we to

will well. the into lot extremely ahead so on of boot side continue into true believe to the diesel and XXXX will bring continues business business. that’s XXXX, perform XXXX flow That’s conventional of So when we’re we this on like shortage to about of capacity we positive production plan, very The time, EBITDA. then coming our new a renewable if cash prevail, the will, to look -- really we refining it

EBITDA creates just We with is obviously, market asset that has confusion. like do volatility forecast as call the follow of the far an we’re going provide power generate you idea some last we just the the got provide when guidance the to what to did provides you don’t to we seen, of to guidance, today way do it We want what to at our forward. the cash. quarter guidance As goes, and just market a try in industry the end -- only straight trying

with So, market cost our and using and go mind, forward like providing will more forward. look as guidance, measurable we the strips we per in let operating figure we’ll the be what out pricing barrel that

Thank you, guys.

you. Thank

Oppenheimer. from question. Our next Noah question your with pose is Kaye coming Please

Great.

derivatives just to I want up position, response we sure around Ben, follow So understand. clarify, make the on to your

and million be an the number you’re -- of in saying in you a position if loss already something you’d one, So gain tune in crack the derivative and be with changed as of accrued starting spreads $XX today that that come third or to gain? today would the for nothing to unrealized XQ a to quarter from recognize derivative down, realized

it in quarter. And Noah. correct, be would gain a realized That’s Yeah. the third

That’s All helpful. right. very

outside rate XX% level expected do to capture we about going XQ, the forward, about derivatives, it’s call than think and out right to going the lower there So of spread forward? was in around higher run it the thinking the be anything how or

we around In Yeah. I’d position the our it X/X/X do market say, that the crack the real I of was opinion, as think, as in how out. the a believe no Again, crack the far plays in capture on diesel depends premiums. XX% how with spread. and short that out spread, answers, plays is material

Our asset is a diesel heavy asset.

benefit So by that long-term we’re going by, to factor.

markets is And are these all market so, that are out trying in up our do we figure the to right, going favor the to for guess, end a so asset. believe where going conditions and

to stand for confidence level project almost you on see seem I And what’s it -- the diesel your times construction lead little push point in get or a Okay. to mentioned, have able of the the terms is XXXX the guess, into being how and like we seems key renewable that long in two equipment? longer. and times, up every major equipment these XQ key in that project, delivery days there bit anything can long out lead visibility progress some equipment like point much you or this the at project anything by

Yeah. is James Rhame. Noah, this

answer we us me it. see stage, that answer At not anything or concern. is causing Let this do that to attempt

to equipment every as and bulk to anything areas and don’t the for to schedule, we’re on yet, bit go. are on bows. know of We concern of is very it. till don’t watch seems the eyes that sure available as our I be and that much Unfortunately, equipment’s hitting piping, making of not about we’ll this. the going but show watch the to right have we equipment, this continue may am us -- more all engineered now continue the of at specialty down However, stated, of than Right and specialty I it doesn’t it we we I you up ready until OFH is material see careful take be to

discussed, that our to to elements little just that plugged supply of also on we we some schedule, that starting impact with of area two of is the so the on risk more around resources, managing come. but engineering not is We’re have chain just but us a the also, we’re COVID project that in this impact bit

Okay. Thanks.

on sneak asset Let sale. Obviously held you bit it’s a in really about thinking today? that one update you. business business certainly the the that, just here. classified us elevated me levels more continued how UMO just strategic interest outperform, around spreads to buyers, you current the Can thinking Thank and driving the as potential here still of has element business, from are little for your expectations of current but

hope been several of months We of work the with finish in the has up play to discussion. Yeah. Yeah. out that quarter coming last just this

is felt the in accounting it’s all and the business responsibility There fiduciary parts to goal. come to that that’s like hold a So, wise, -- process. to we is it clarity is interest and tendered necessary several the manage more everything has just next our as and of of in that our quarter in have

So keep that’s whole I -- pattern it’s then don’t for in we think -- been put and now. bed, we’ve advised a to to this resolved until

really Understood. is well. I the mean, business performing

some… hopefully you that gives So

Yes.

right. … flexibility. All

Yeah. Absolutely.

Thanks. jump in queue. I’ll back

you. Thank

question. Our is Stein next Eric question with from Please your Craig-Hallum. pose

everyone. morning. Good Hi,

Good morning, Eric.

morning. Good

bit? portion me you also place lots morning. the production, naked and you Good yes, -- went hedge, spreads can in so that of you mean, out but for in quarter, higher. you here noise Hey. your Can Yes, just with little of the guided a I help in did hedge

your something’s $XXX know, and in between you delta but at such because -- can reported -- number, just why if you deck, guidance trying of like I’m help bridge, that -- just the your your great, me just it big midpoint out, I So give here? be would million to it something out missing figure and it’s a the seems

Yeah.

flat believe impact. bridge So I the down. breaks and They good seven, -- the that in question spread kind the key of is

with So that a we at $XX way point that’s market at having only forward a looking be strip in expectations on time, forward When you’re you’re short were of million to to that using, reconcile you’re back, going the which discussion. pricing the guidance. that provide you

assumed inside we on some inventory Second, then would we’re that had that And refinery over, was out that we so the took yield put minor adjustments just had play us, I guess. refinery, we you the as not actual, impact. that have

would from inventory lumpy gain that the So to product a end be additional ended in the of this that the lot the quarter. quarter to market with up of beginning did not get the the quarter, at is finished right a of We business.

the So, build $XX have in see product. million, for load at been already produce paid can you gain significant balance has you’re inventory. vessels, our et We if to when to and cetera, -- those cost lost the margin, out just we the sheet, look take will events cargoes, you nothing sale going inventory, a really forecasting reflects place, that that when

I yeah, we think the really, -- that’s So, well. out market played really

just quarter. And it everybody when would, so, the think future I that, across looking play thought out like didn’t you’re

kind that’s… you’re flow, how asset that’s so when of do as and bought So strong give of idea produce refinery, you just, the market good ability provide no an as to and to trying feel way when the cash really we its of an direction was can there some to

Okay.

were $XX difference. I’m timing, quarter. still, kind million then given guess, $XX a already end And the mean, something that it If the offline. that million third But you going you’re backup quarter. be $XX.X in something impact any mean, yield happens I need at that that, -- I but of the rectified of inventory quarter short, incorrectly, there’s I that’s what you’re that’s, going I to the it to we’ll just can third you take have then you sounds guided. make was its maybe mean, right, when So, knew you it’s understanding you like and mean, to about million I the impact, see that’s I

figure out to talk more trying we and if that’s… it’s something need about, do we take can delta, just offline, in the I’m So but to that, depth certainly

No…

…thing missing. I am

Yeah.

sense. was it more played we outcome. to going in the say we point when hand at Let forward to million were than the difference using actual me which forward When that were provided you’re in just pricing reconcile was in pricing the pricing. the get a again, out, makes you $XX that guiding, guidance That

it’s Yeah. the kind about it. X/X/X Maybe, that thoughts that I you a something it’s about back quarter not we but crack yeah, dig switch, on something X/X/X this can previously, going offline the Maybe, this of can a But it Yeah. fluid, can based first so and is -- me know it and I and that switch forward the it’s that, little your now X/X/X, into on you operating the -- market? just or let maybe on permanently mean, thinking as is more. talk right, is think of where dime, forth, your

Yeah. James. This is

occurs selling how Let and try will -- going and provide to will that renewable year We spread operation will down, that those. a to renewable answer occurs so now feeds fourth X/X/X market future a get to great the so have diesel you we’ll see of at the lose think I guidance the and we’ll comes to a What consistent. quarters, the the -- look quarter way change we continue when we forward next converted on some better be down OFH lead not But picture OFH so the what really diesel the of the its have this the is change in the product, yet, different we’ll comes in as to sure do looking will because and product that out go OFH make I’m the diesel, spread, in and communicate is that’s don’t the today. as more that. is in to roll of crack reflect we’ll what forward. me that a that’s

Yeah.

OHF make net (sic) what you lose renewable [OFH] Your on with the to be hot, diesel going are right? and

Okay.

ahead So you we gasoline, your which typically then cat it diesel be XX% cracker. XX% to and is the gasoline, a feed goes will vacuum yield a diesel if on indicate is

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think what timing good that is and I that for the So really have for we’ll we’re product doing market.

rest Okay. take the I’ll offline. Thanks.

right. All

you. Thank

you. Thank

Thank you.

Our Dayal next your Amit please H.C. with question from Sir, is Wainwright. pose question.

how anything that the least morning, sort for confidence for the visibility guess, my establishing on not from preventing guidance in you there spreads, don’t key for sort Is XXXX? have XXXX? for hedged at like It you you. that -- are have what crack question is, some Thank some everyone. environment? current looks the you guidance is establishing Good of you are you Ben, of I

a question, Amit. That’s No. good

are very We rates. production confident on our

The and down these at on in to the confident We’ve the product drivers. crack operating very We’re in difficulty pricing key provided trying the costs. are spreads. your energy those markets, pin that volatility is EBITDA our number

there. we’re and we been It’s getting in sure to far we to the so, and in to the same. second to be used that the out quarter guess, quarter leaving and that so educating that want extremely ourselves are the sure third the I volatility that volatile And make make market may still, that

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for that Okay. not looks And in might you hedges yet. something Is the macro it changes? you like do is quarter, any that environment then fourth are

question. Yeah. No. a That’s very good

would fourth close remarks, have following strategy the refinery. of quarter. at So, currently on hedges, some as started put in not said, were I if the that We with hedging we’re the we the our we same

We have some precedents.

view opportunity We Now we’ve going an forward. do some have that we believe a the markets. -- on got

concerned We’re everything. We on inventory about to cracks. not do that the hedges the have exposure

hedging believe So risk a to that will that we’re But and the putting inventory committee our our present at We’ve exposure -- the not themselves. and now make at team we time, they it’s opportunities is provide recommendations that hedging making. for we’re see all. at to our us that continue better if decisions risk can certain that we managing positions we we execute to any built

forward. So we’re move to that’s going how

same not maybe on now. one see quarter And just third month then last one, again, the the topic. Like, into a we’ve half almost and

environment the second is, just helpful get to investors also any playing I clarity now than so So a for color the situation how on out is far? sort quarter, probably spread of as would the for you the mean, hedging and for how be are results of seen little on? better what you’ve

Yeah.

we’re I going quarter. volatility in to see the continue think third

as of that hedge second to allowance earlier, adjustments, is to going the that ultimately So quarter, But how hard for the -- third was our numbers. part we accrue did we it’s define talked out. the about a in quarter play

so million far we’re this than planned for. in and better had to-date, quarter made So, what $XX we adjustments

heating So what quarter be to That’s to the in going better should we and is second believe we specifically going assumption. that And improve. cracks seen oil around we the is quarter. think our outweigh

Thank Appreciate Ben. That’s all I Understood. it. you. had,

Amit. you, Thank

Thank you.

with Michael your pose Stifel. next Hoffman question. is from Our coming Please question

gang. Hey,

for I farm to want help want do dumb this poor ask clarity believe, I kid to don’t So but some understand.

was of up, I’m forward So end at the making At the on numbers the the like spread conversation, the world understand if it buck. time, $X.XX. a correctly, look day, I it

spreads your those with You on that’s world model. had and there’s we’re moving the right? get a $XX is volatility trying do given challenge the to that million, guidance that’s difference energy the are XX% still you have I around around what and playing that did Is --

Yeah.

to right. a good That’s exactly lay it out That’s there. way

are aggregate, relative are those at What spreads sideways? -- the the flat, are down, right. look All in they like? is they What that moving Okay. are or they XQ to direction they’re up, up, moment

No.

think the more trending down quarter as What firmer a go an we they’re the third is, aggregate. they’re and I down. trending through moment, at and robust as diesel fourth we But the quarter. crack anticipate into

Okay.

so So of the $XX baseline I plus $XX start million million that’s issue. head, with for a was a inventory right, a inventory, timing if

some a that’s baseline… So starting with

Yeah.

mentally and of starting? million. I’ve where … got way headwind. to And that’s ought be that that’s spread a $XX pressure, Is think, right the sort then so I to

only we’ve is The add provided increased production rates in I the this thing call. would No. Yeah. that

So barrels day a we’re barrels barrels we for to XX,XXX and guided XX,XXX the day to a day XX,XXX third quarter. a

is part. the doing So certainly refinery their

Okay.

we -- but I takes, output. are two the those so and are the got So better puts narrowing spreads and major

That’s right.

for the …for balance, sure.

I’m go round at end, that’s still bid the that? starting plus way $XX now $XX the right inventory, around that to -- But think, $XX is the million, numbers opening on Okay. with now quarter in million the play

Yeah.

Now I think good to think that’s a about. way

right. All Okay.

of was going that major the into As need to rate kind turnaround the I different year year a looks the XX account versus is think about Oil that for? the from can ask want of million. Is XX it to do run or to perspective. a million XX way to right came thinking coming to be million activity there on a the Black -- for like about it’s pace I I like -- It Black to the now more

No.

think code. -- good directionally zip you’re that’s I mean… I a in

Yeah.

business well, done is done are spreads just really well, teams really general in … good. the

collections. our We continue to grow

on to in the So to we quarter bigger taken we’re we’re really and up going It’s, pleased is provide with color the with where asset. legacy very but backing at legacy Mobile business the the nothing the quarter obviously, we picture on third refinery, are the have -- fourth on the related where the into business.

Okay.

me would a get ops, help So continuing My whether business, ops on it the and that ops. concentrate be if and Mobile be -- understand dis of accounting energies is assumption issues, still assets your process. dis this was you an seller maintaining sell ongoing or I that’s I’d the you would

back Heartland you little back not but in, I’m Heartland buying I why get in? a So confused, -- optionality do buy I’m there, Myrtle if that’s Grove why of might true, buying what

our want as long-term our legacy of part We capital in Yeah. structure We up. strategy. believe clean our to decarbonisation business

what bring comes our into of and to energy and business to our Mobile, doing gives the we’ve done on our reclamation, the over foundation we in the and focus, it’s as tenure So renewables work we’re renewables it hydrocracker when recycling transition a transition. long us legacy

that of And aspire and the of what refiners. to more strategy we part be brand independent as transition in space, that company we our energy just so, the energy of keep than to overall want

Okay.

then? you’re message you’re the a the So pulling sending off sale market that

the am that, before legacy into back sending strategy from a complete done go our can get I and message we accounting we work as make got comes that work to -- our of how there. an got business that we picture. and we’ve And and decision love part on then to

you sitting is made, That’s today here the In cash have loss sending, right, basically -- million right? number and quarter that comment That to I the were would you’re that then the… for Okay. million the flow understanding ended the am XQ, if accounting, be message the is like $XX smaller. hedged commodity statement $XX.XXX

Yes. That’s correct.

That’s correct. right. That’s

far and everything’s to? you mean, to your do giving so that items, not you indication, you’re James, of on able October can it’s nobody’s show the do lead to you’re And believe stuff long the all not up confidence supposed shutdown, you shows be Okay. to any is down going because I supposed so up. That’s unless on shutdown in part shutting then, -- your

are That’s -- absolutely you correct.

the of from? stuff is part What coming Okay. world this

its at the this we’ve line on, starts valves, -- of but got engineered of good sight most is the really it and specialty pipes is Most the the becoming bulks. and equipment, stage domestic of

Just to I’m give you know the a rough details. number and I getting probably

We project occur And have be this pipes to successful. and tie-ins have unit those XXX of a is of -- XXX it’s and over to many tie-ins that that OSBL little for the inside also. specialty all

is And their issue… Okay.

Okay.

them, or chain demand it’s to when to you, making they’re supply be really the as fast sold strong made they could make and get just issue and things is can they’re and potential a shipped? as they have going get They

can you most try we’re make understanding. what doing, they’re the is help to material. to and do ability going them, extra we talking get them. and to ability our of with also Both and see their Their it’s we’re help hours, running, things to But

Thanks. right. All Okay.

you. Thank

Gentlemen, like in comments back for it will as you’d to no queue. be any there hand further questions management with. the appear closing I to to finish

Okay. I in the cash to and and with it. Ali, new a unfold a underscore very the did the transitioning did that legacy large in the a piece am faced hand, I as you of their of work strategy into market, the have thankful company. work of and forward the very as as hold we you. their well in that far And both business. thank business we just takes the digest, our we our hard team this thank quarter. our new lot can’t cash monumental quarter, future fact going delivered generation business, our this everybody asset for and we call. everything on more What team the challenge team to the the certainly for the It’s One that job. operationally as

that and quarter deliver ball were to first our material things to shareholders. And without the to in that’s for all $XX get to any very balance have I exposure tall been to with So, plan decision, having upside back the a but we the the and bank and dropping the just account so. without we the I’d in be hedging, full journey on love from stand our future to doing able managing that accomplish on have sheet the us in and million for the able personally the here setback our

third sure, we information and and thank the to now call, quarter market our the to that for look So everybody provide for you and support you. Thank between hope we to continued forward end. the

ladies This you, gentlemen. today’s conference call. and Thank conclude does

your You and a you time for have Thank at wonderful this participation. your day. may lines disconnect