Fuel Forward: The Digest’s 2019 Enhanced Multi-Slide Guide to Renewable Energy Group

C.J. Warner: Our sales and marketing team continued strong execution of the downstream expansion strategy. We are focused on moving down the value chain to serve our customers more directly and expand the overall use of biodiesel in the fuel pool. In addition to our strong first quarter sales, we are running several programs intended to develop new downstream channels and offers, starting out relatively small before expanding significantly. We added 5 terminals in the first quarter, and we’ll continue to add more. Next week, for example, you will hear about a new terminal partnership with Broco Oil Company in Haverhill, Massachusetts, in which we will significantly expand the availability of BIO-BASE heating oil and transportation fuel to customers in the region.

We also continued our expansion to reach end-user customers directly from our local facilities. We have two examples to highlight. Soon we will open our first-ever REG cardlock station, which is adjacent to the Seneca Biorefinery. This will be an automated, 24/7 retail fueling station, which allows any customer to obtain their fuel directly from us. Our station will offer biodiesel blends produced at our local plant. This location allows us to serve our customers directly and enables us to refine our approach to further expand this channel.

Second, we’re running a fuel distribution pilot in Iowa using an REG owned and operated delivery fleet that delivers blends of our locally-produced biodiesel direct to end users. One of the advantages of delivering direct to customers is we are generating greater enthusiasm for higher biodiesel content blends. In addition, as the fleet operator, we’ve modified our delivery trucks with a system that enables us to operate on B100, in other words 100% biodiesel fuel, year-round, even in harsh Iowa winters. We intend to significantly expand this exciting business model.

Finally, our initiative to offer differentiated blends of renewable diesel and biodiesel products continues to gain traction, and this includes REGI’s Ultra-Clean Diesel brand. We sold 11 million gallons of premium blend of renewable diesel and biodiesel in the quarter, a rapid expansion over the first quarter of 2018. We continue to see customer enthusiasm and find opportunities to leverage the unique capabilities based on our scale of renewable diesel and biodiesel production.