Renewable energy is an investment in the future and Montauk Renewables has been ahead of the curve, producing clean energy for more than three decades.
Montauk Holdings delisted from the JSE on January 1. Montauk Renewables started trading a week later on January 25, with a primary listing on the Nasdaq and a secondary inward listing on the JSE. Investors holding one Montauk Holdings share received one share in Montauk Renewables.
While Montauk Renewables is a South African entity, its operations and staff of 115 people are in the US. Headquartered in Pittsburgh, the company specialises in the recovery and processing of biogas from landfills and other sources as an alternative to fossil fuels.
It operates 12 renewable natural gas sites and three renewable electricity projects across six US states where it captures methane, preventing this greenhouse gas from being released into the atmosphere, and converts it into either electricity or natural gas.
It provides a fully integrated solution for the management, recovery and conversion of biogas from waste sources into renewable energy.
This year, Montauk shot to second place in the Sunday Times Top 100 Companies, an indication that investors are backing renewable energy.
“This listing is an opportunity for South African investors to invest in the green fuel space, and help preserve our planet for future generations,” said Valdene Reddy, JSE director of capital markets, in a statement when the company listed on the JSE.
Total revenue for the year ended December 31 2020 declined 5% to $100.4m.
Montauk Renewables CEO Sean McClain said in a statement accompanying the annual financial results in February: “The primary driver for this decline related to a 16.1% decrease in renewable electricity from our election to end the contract and exit our Monmouth facility [in New Jersey], and the California wildfires affecting power generation at our Bowerman facility.
“We produced 5.7-million MMBtu [million British thermal units] of renewable natural gas during 2020, a 7.2% increase from the 5.4-million produced in 2019. Of this increase, 0.2-million MMBtu of renewable natural gas was produced from development sites commissioned during 2019,” said McClain.
But the pandemic has presented challenges. Despite being considered an essential services company under the terms of the US Cybersecurity and Infrastructure Security Agency, it suffered losses because of the reduced need for transport fuels during lockdowns and a drop in the price of renewable identification numbers (RINs).
A RIN is a serial number assigned to a batch of biofuel to track its production and use, as well as any trading in it. The US Environmental Protection Agency sets annual quotas for biofuel use, and RINs — which are themselves tradable items — are required to show these quotas have been met.
“To date, the pandemic has adversely affected, and is expected to continue to adversely affect, our business, financial condition and results of operations. The spread of Covid-19 has disrupted certain aspects of our operations, including our ability to execute on our business strategy and goals, and complete the development of our projects,” said McClain.
“Commissioning of our development sites was delayed by between four and five months in 2020. Delayed commissioning also delays the registrations and qualifications necessary for EPA pathways which, in turn, delays revenue streams from these facilities.”
The Sunday Times Top 100 Companies is sponsored by BCX
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