Adam Comora: Yeah, no. Thanks, Adam. This is Adam here. Royalties in line with our historical averages. The CapEx in line with our most recent experience of the last, I don’t know, three, four projects, or two or three projects that we put into construction. And we had already previously 8-K’d that. So, you can see who the landfill partner is, where we still have a couple more gas rights there that we had one in an RFP, and look to continue to deepen that relationship. And it’s actually also a really testament to the experience of the team here at OPAL Fuels, where that was a little bit of a development challenge to solve a pipeline issue there, which we were really happy that we were able to do. And I think it’s when OPAL executes on those types of projects that we gain confidence with our various partners out there.
And we see it being completed in a typical timeframe and excited about that one and excited about what else we’re finding out there for the balance of the year of new projects.
Adam Bubes: Great. Congrats to the team. Thank you.
Operator: One moment for our next question. Our next question will come from Jimmy Larkin of Piper Sandler. Your line is open.
Jimmy Larkin: Hi, good morning. Thanks for taking my question. I guess just on the dispensing side, could you maybe talk about what your CI mix is currently and kind of where you expect it to go in the future? And I guess how that might impact how you place your landfill gallons going forward?
Adam Comora: Yeah, no, I appreciate the question. So it’s a two-part question. The vast majority of OPAL Fuels’ production is landfill gas, and that can be anywhere from sort of 40 to mid-50s or 45 to 60 for a CI score. And we do just — and we also obviously have our Sunoma project, which is significantly negative CI. Is that negative 238, somewhere in that range? 283?
Jonathan Maurer: 330.
Adam Comora: Excuse me. 330. And we also, though, do dispense third-party gas specifically at our California sites. We have a very large dispensing network in California, and we do partner with third-party dairy suppliers to dispense their significantly negative CI through that portfolio of dispensing stations. So, I don’t have the exact math, if you blend the two, between what we’re dispensing outside of California and what we’re dispensing inside of California, but we actually do think there’s a good opportunity for us to continue to add low-CI supplies through our California dispensing network.
Jonathan Maurer: And through that, we participate in the LCFS market, really, through that broad participation in the low-CI third-party gas.
Adam Comora: And by the way, that shows up in our Fuel Station Service segment in our environmental credit revenues piece, whereas we continue to place more dairy gas, either from OPAL or other third-party suppliers through our California dispensing network. You’ll see growth in that revenue segment for that business unit.
Jimmy Larkin: Got it. Thank you. I guess just one more. In the presentation deck, you mentioned eRINs a few times. Is there any updates, maybe on the potential for eRINs going back or have you guys heard anything on that front?
Adam Comora: Yeah. So, this is Adam again here. And as I was chatting about before, we are — at some point, we believe eRINs will get included into the RFS, and the question is when. And we have the belief that we may be able to get bipartisan support for it, where it’s pretty clear that the Biden administration has been really supportive of inserting it into the program. And we think it makes a lot of sense for a lot of the Republican constituents out there as well. And there’s a variety of reasons for that, where if you look at the areas or sectors of the economy that benefit from it, a lot of them are in Republican kind of areas. And we don’t believe it’s a zero-sum game with corn or soy or other agricultural liquid biofuels.
It really doesn’t have any impact on the markets that they participate in for the RINs that they potentially produce. And we’ll see how effective we’ll be in our education and advocacy around it for how quickly it can be adopted. I would say it is impactful for us, not only on our existing portfolio, but quite frankly, on a lot of development opportunities. And we think it’s the right public policy. So I can’t give you an exact timeframe when, but we think there’s an opportunity to maybe talk about it this summer with EPA and see if we can get Republicans on board so it wouldn’t necessarily be repealed. And if Biden happens to win, then it would obviously remain in place. And that’s where I was sort of talking about before where we — just like that particular issue, eRINs isn’t zero-sum for corn and soy, we don’t think the political outlook is zero-sum for OPAL Fuels because there are certain areas where Republican administration maybe is more forward or on the molecule side of things.
So anyway, it’s something that we’re still focused on and we’ll see how quickly they get adopted.
Jimmy Larkin: Great. Thanks for answering my questions. I’ll turn it back.
Operator: Thank you. And our last question will be coming from Paul Cheng of Scotiabank. Your line is open.
Paul Cheng: Thank you. Hey, gentlemen, a real quick one. The utilization of inlet gas is 81%, dropped 5% from the year-ago level. Is there any particular reason contributing to that? Thank you.
Adam Comora: Yeah. Paul, I was waiting for that one. And what I want to first just say is I wouldn’t get too hung up on either metric, the inlet capacity utilization or the utilization of inlet gas in any one particular quarter, because we are a fast-growing company and we do have larger facilities that are coming online. If you look at those two metrics year-over-year, our inlet capacity utilization went from 75% to 80%. And that’s when we’re always talking about same-store sales growth and areas where — that’s the amount of gas that’s coming into our facilities, and that comes from improvements of collection systems and that sort of thing. And the metric you were asking about is then the utilization or the efficiency of turning that raw biogas into final product.
And that’s where it went from 86% down to 81% year-over-year. But if you look at it sequentially quarter-over-quarter, the fourth quarter inlet — or the utilization of inlet gas went from 79% up to 81%. And really what you’re seeing here is the ramp of Emerald. And we expect those trends to continue throughout the year. And that being said, as I was talking earlier about Prince William now in operations, you may see when a big facility comes online, your inlet capacity utilization drop or have an impact from one of those larger facilities as it ramps up. So specifically, in the quarter, we did see it tick up slightly from 79% up to 81%. But year-over-year, 86% down to 81%, was really that Emerald facility being in this year’s metric versus not in the last years.
And not outside of our expectations, by the way, which is why we also talk about this range of 80% to 90% on both of those factors which can be skewed, as I was saying, as new facilities come online. And we feel like Emerald’s ramping well. And I want to say it’s also — we used to get asked a lot of questions about this partnership model or JV model, or why do you partner with landfills and these types of projects, because GFL, who’s been a great partner of ours was one of the forward thinkers — one of the first movers or forward thinkers to invest capital alongside of us in these types of projects. And I have to say working with GFL specifically on that project, it’s really a testament to that partnership model where we’re fully aligned to continue to ramp and maximize the quality and the quantity of the gas that’s coming into that facility.
And if we went back five or six years ago, it was really tough to get the attention of landfills to focus on those types of improvements and that sort of thing. So, the short answer is, you can’t just look at it year-over-year on those types of metrics because you have new facilities that are coming in and ramping. But you have to look at those things in conjunction with what else is happening in the portfolio.
Paul Cheng: Very good. Thank you.
Operator: And I’m showing no further questions at this time. I would now like to turn the call back to management for closing remarks.
Adam Comora: All right. This is Adam Comora. Thank you very much for joining us on our first quarter call, and I hope everybody has a great day.
Operator: This concludes today’s conference. Thank you for participating. You may now disconnect.
