CALGARY,
AB, June 28, 2022 /CNW/ - Tidewater Renewables
Ltd. ("Tidewater Renewables" or the "Corporation") (TSX: LCFS) is
pleased to announce a multi-year agreement today with an
investment-grade company to sell Federal Clean Fuel Regulation
("CFR") credits that it will receive through the production and
sale of fuel produced at the Renewable Diesel & Renewable
Hydrogen Complex at Prince George,
BC (the "Complex"), adding previously unrecognized value and
an incremental revenue stream to the Corporation.
As part of the transaction, Tidewater Renewables has agreed to
sell a total of 45,000 CFR credits at $95 per credit. This multi-year agreement, which
extends to June 30, 2025, adds
previously unrecognized value for CFR credits and Tidewater
Renewables will receive total proceeds of over $4 million over the term of this agreement. The
Corporation's current run-rate EBITDA estimates for the Complex of
$90 – 100 million exclude the impact
of the outlined forward sale and any value for the ongoing sale of
CFR credits once the program is implemented.
"This is Tidewater Renewables' inaugural CFR credit sale, which
we believe is the first of its kind in Canada. This credit sale is significant for
Tidewater Renewables as it validates our previous thesis that CFR
credits will represent an incremental revenue stream for our suite
of clean fuel projects. Furthermore, at similar CFR credit values,
Tidewater Renewables' HDRD Complex has the potential of generating
an incremental $30 million of
run-rate EBITDA assuming feedstock prices, diesel prices and BC
LCFS credit prices remain constant," said Joel MacLeod, Executive Chairman and CEO.
The Corporation continues to work on other potential multi-year
agreements to monetize further CFR credits that it will receive
from operation of the Complex, from its Canola Co-Processing
Facility, and from other projects.
Forward-Looking Information
This news release contains forward-looking statements and
forward-looking information (collectively, "forward-looking
statements") that relate to the Corporation current
expectations and views of future events. These
forward-looking statements relate to future events or the
Corporation's future performance. Any statements that
express, or involve discussions as to, expectations, beliefs,
plans, objectives, assumption or future events or performance
(often, but not always, through the use of words or phrases such as
"will likely result", "are expected to", "expects", "will
continue", "is anticipated", "anticipates", "believes",
"estimated", "intends", "plans", "forecast", "projection",
"strategy", "objective" and "outlook") are not historical facts and
may be forward -looking statements and may involve estimates,
assumptions and uncertainties which could cause actual results or
outcomes to differ materially from those expressed in such
forward-looking statements. No assurance can be given that
these expectations will prove to be correct and such
forward-looking statements included in this new release should not
be unduly relied upon. These statements speak only as of the
date of this new release. In particular and without
limitation, this news release contains forward-looking statements
pertaining to Tidewater Renewables' business as described under the
heading "About Tidewater Renewables" below; and the potential
addition of run rate EBITDA derived from the sale of CFR credits
produced at the HDRD Complex. Forward-looking information is based
on a number of assumptions and is subject to a number of risks and
uncertainties, many of which are beyond the Corporation's control,
which could cause actual results and events to differ materially
from those that are disclosed in or implied by such forward-looking
information. Such risks and uncertainties include, but are
not limited to, the factors discussed under "Risk Factors" in the
Corporation's supplemented PREP prospectus dated August 12, 2021, filed on SEDAR. Tidewater
Renewables' does not undertake any obligation to update such
forward-looking information, whether as a result of new
information, future events or otherwise, except as expressly
required by applicable laws.
Non-GAAP Measures
EBITDA
This press release refers to "EBITDA" which does not have any
standardized meaning prescribed by generally accepted accounting
principles in Canada ("GAAP").
EBITDA is calculated as income or loss before interest, taxes,
depreciation, share-based compensation, unrealized gains/losses,
noncash items, transaction costs, items that are considered
non-recurring in nature and the Corporation's proportionate share
of EBITDA in their equity investments.
Tidewater Renewables' management believes that EBITDA provides
useful information to investors as it provides an indication of
results generated from the Corporation's operating activities prior
to financing, taxation and non-recurring/non-cash impairment
charges occurring outside the normal course of business. EBITDA is
used by management to set objectives, make operating and capital
investment decisions, monitor debt covenants and assess
performance. In addition to its use by management, Tidewater
Renewables also believes EBITDA is a measure widely used by
security analysts, investors and others to evaluate the financial
performance of the Corporation and other companies in the renewable
fuels. Investors should be cautioned that EBITDA should not be
construed as alternatives to earnings, cash flow from operating
activities or other measures of financial results determined in
accordance with GAAP as an indicator of the Corporation's
performance and may not be comparable to companies with similar
calculations
Run Rate EBITDA
"Run rate EBITDA" is defined as the expected EBITDA to be
generated by a specific asset or specific growth project
corresponding to a full year of operations at full capacity. Run
rate EBITDA excludes non-cash items including stock-based
compensation. The calculation of run rate EBITDA is based in
certain estimates and assumptions and should not be regarded as a
representation by the Corporation or any other person that the
Corporation will achieve such operating results. Prospective
investors should not place undue reliance on the Corporation's run
rate EBITDA and should make their own independent assessment of the
Corporation's future results or operations, cash flows and
financial condition.
ABOUT TIDEWATER RENEWABLES
Tidewater Renewables is traded on the TSX under the symbol
"LCFS". Tidewater Renewables is a multi-faceted, energy transition
company. The Corporation is focused on the production of low carbon
fuels, including renewable diesel, renewable hydrogen and renewable
natural gas, as well as carbon capture through future initiatives.
The Corporation was created in response to the growing demand for
renewable fuels in North America
and to capitalize on its potential to efficiently turn a wide
variety of renewable feedstocks (such as tallow, used cooking oil,
distillers corn oil, soybean oil, canola oil and other biomasses)
into low carbon fuels. Tidewater Renewables' objective is to become
one of the leading Canadian renewable fuel producers. The
Corporation is pursuing this objective through the ownership,
development, and operation of clean fuels projects and related
infrastructure, utilizing existing proven technologies.
Organically, Tidewater Renewables will seek to leverage the
existing infrastructure and engineering expertise of Tidewater
Midstream and Infrastructure Ltd., its majority shareholder,
regarding the development of the Corporation's portfolio of
greenfield and brownfield capital projects as well as the expansion
of the Corporation's product offerings. Additional
information relating to Tidewater Renewables is available on SEDAR
at www.sedar.com and at www.tidewater-renewables.com.
SOURCE Tidewater Renewables Ltd.