Calumet Products to invest $25M in Louisiana gas-to-liquids JV

Calumet Specialty Products Partners (CLMT) says it will invest as a joint venture partner in the construction of a Lake Charles, La., commercial gas-to-liquids plant that is expected to produce 1,100 bbl/day of refined products from natural gas.

CLMT intends to invest $25M in exchange for an equity interest of ~22% in the joint venture; the total cost of the plant is estimated at $135M and should be operational by late 2015.

Comments (4)
  • jerrywengler
    , contributor
    Comments (658) | Send Message
    First reaction--wow, feels like science fiction to me. This seems to look like part of the next era in USA and world energy supply. As an investor in CLMT it feels good to be a part of it.
    9 Jun 2014, 08:24 PM Reply Like
  • jerrywengler
    , contributor
    Comments (658) | Send Message
    I didn't understand correctly what they were doing when I first saw this piece. Now that I see a full description of the products to be made, it wasn't what I first thought it was, but it's still a great deal.
    9 Jun 2014, 10:01 PM Reply Like
  • Retired CFA
    , contributor
    Comments (332) | Send Message
    Agree. It's the same kind of products they've been making all along, but perhaps a (much) cheaper way of doing it.


    I like the way they keep expanding - a little here, a little there.
    9 Jun 2014, 10:36 PM Reply Like
  • shughes1116
    , contributor
    Comments (120) | Send Message
    In 2013, CLMT's Specialty Product's segment showed a gross profit of about $32 per barrel. In the first quarter of 2014, CLMT's Specialty Product segment showed a gross profit of $42 per barrel. I am not a petroleum engineer, but based on my quick reading of the CLMT reports, CLMT's primary feedstock for the Specialty Product's segment is crude oil. At $5 per mmBTU, using natural gas as the primary feedstock is substantially cheaper than crude oil.


    Once this plant begins operation, the CLMT's Specialty Products segment should see an increase in revenue AND an improvement in margins due to the cheaper feedstock. I think the important question here is what ability does this joint venture have to increase the scale of production at this facility.
    11 Jun 2014, 06:43 PM Reply Like
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