Montauk Renewables, Inc.

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Glossary of Key Terms

This Annual Report on Form 10-K uses several terms of art that are specific to our industry and business. For the convenience of the reader, a glossary of such terms is provided here. Unless we otherwise indicate, or unless the context requires otherwise, any references in this Annual Report on Form 10-K to:

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“ADG” refers to anaerobic digested gas.

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“CARB” refers to the California Air Resource Board.

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“CNG” refers to compressed natural gas.

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“CI” refers to carbon intensity.

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“CWCs” refers to cellulosic waiver credits.

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“D3” refers to cellulosic biofuel with a 60% GHG reduction requirement.

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“D5” refers to advanced biofuels with a 50% GHG reduction requirement.

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“EHS” refers to environment, health and safety.

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“EIA” refers to the U.S. Energy Information Administration.

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“EPA” refers to the U.S. Environmental Protection Agency.

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“Environmental Attributes” refer to federal, state and local government incentives in the United States, provided in the form of RINs, RECs, LCFS credits, rebates, tax credits and other incentives to end users, distributors, system integrators and manufacturers of renewable energy projects, that promote the use of renewable energy.

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“FERC” refers to the U.S. Federal Energy Regulatory Commission.

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“GHG” refers to greenhouse gases.

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“JSE” refers to the Johannesburg Stock Exchange.

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“LCFS” refers to Low Carbon Fuel Standard.

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“LFG” refers to landfill gas.

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“LNG” refers to liquefied natural gas.

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“PPAs” refers to power purchase agreements.

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“QF” refers to “qualifying facility,” as such term is defined in the Public Utility Regulatory Policies Act of 1978.

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“RECs” refers to Renewable Energy Credits.

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“Renewable Electricity” refers to electricity generated from renewable sources.

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“RFS” refers to the EPA’s Renewable Fuel Standard.

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“RINs” refers to Renewable Identification Numbers.

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“RNG” refers to renewable natural gas.

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“RPS” refers to Renewable Portfolio Standards.

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“RVOs” refers to renewable volume obligations.

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“WRRFs” refers to water resource recovery facilities.

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Cautionary Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of U.S. federal securities laws that involve substantial risks and uncertainties. All statements other than statements of historical or current fact included in this report are forward-looking statements. Forward-looking statements refer to our current expectations and projections relating to our financial condition, results of operations, plans, objectives, strategies, future performance, and business. Forward-looking statements may include words such as “anticipate,” “assume,” “believe,” “can have,” “contemplate,” “continue,” “strive,” “aim,” “could,” “design,” “due,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “likely,” “may,” “might,” “objective,” “plan,” “predict,” “project,” “potential,” “seek,” “should,” “target,” “will,” “would,” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operational performance or other events. For example, all statements we make relating to our future results of operations, financial condition, expectations and plans, including those related to the Montauk Ag project in North Carolina, the Second Apex RNG Facility, the Blue Granite RNG Facility, the Bowerman RNG Facility, the delivery of biogenic carbon dioxide volumes to European Energy, the Emvolon collaboration and pilot project, the Tulsa facility project, the resolution of gas collection issues at the McCarty facility, the delays and cancellations of landfill host wellfield expansion projects, the mitigation of wellfield extraction environmental factors at the Rumpke and Apex facilities, how we may monetize RNG production and weather-related anomalies are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expect and, therefore, you should not unduly rely on such statements. The risks and uncertainties that could cause those actual results to differ materially from those expressed or implied by these forward-looking statements include but are not limited to:

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our ability to develop and operate new renewable energy projects, including with livestock farms, and related challenges associated with new projects, such as identifying suitable locations and potential delays in acquisition financing, construction, and development;

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reduction or elimination of government economic incentives to the renewable energy market, whether as a result of the new presidential administration or otherwise;

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the inability to complete strategic development opportunities;

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widespread manmade, natural and other disasters (including severe weather events), health emergencies, dislocations, geopolitical instabilities or events, terrorist activities, international hostilities, government shutdowns, political elections, security breaches, cyberattacks or other extraordinary events that impact general economic conditions, financial markets and/or our business and operating results;

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taxes, tariffs, duties or other assessments on equipment necessary to generate or deliver renewable energy or continued inflation could raise our operating costs or increase the construction costs of our existing or new projects;

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rising interest rates could increase the borrowing costs of future indebtedness;

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the failure to attract and retain qualified personnel or a possible increased reliance on third-party contractors as a result, and the potential unenforceability of non-compete clauses with our employees;

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the length of development and optimization cycles for new projects, including the design and construction processes for our renewable energy projects;

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dependence on third parties for the manufacture of products and services and our landfill operations;

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the quantity, quality and consistency of our feedstock volumes from both landfill and livestock farm operations;

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reliance on interconnections with and access to electric utility distribution and transmission facilities and gas transportation pipelines for our Renewable Natural Gas and Renewable Electricity Generation segments;

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our ability to renew pathway provider sharing arrangements at historical counterparty share percentages;

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our projects not producing expected levels of output;

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potential benefits associated with the combustion-based oxygen removal condensate neutralization technology;

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concentration of revenues from a small number of customers and projects;

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our outstanding indebtedness and restrictions under our credit facility;

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our ability to extend our fuel supply agreements prior to expiration;

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our ability to meet milestone requirements under our PPAs;

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existing regulations and changes to regulations and policies that effect our operations, whether as a result of the new presidential administration or otherwise;

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expected impacts of the Production Tax Credit and other tax credit benefits under the Inflation Reduction Act of 2022;

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decline in public acceptance and support of renewable energy development and projects;

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our expectations regarding Environmental Attribute volume requirements and prices and commodity prices;

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our expectations regarding the period during which we qualify as an emerging growth company under the Jumpstart Our Business Startups Act (“JOBS Act”);

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our expectations regarding future capital expenditures, including for the maintenance of facilities;

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our expectations regarding the use of net operating losses before expiration;

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our expectations regarding more attractive CI scores by regulatory agencies for our livestock farm projects;

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market volatility and fluctuations in commodity prices and the market prices of Environmental Attributes and the impact of any related hedging activity;

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regulatory changes in federal, state and international environmental attribute programs and the need to obtain and maintain regulatory permits, approvals, and consents;

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profitability of our planned livestock farm projects;

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sustained demand for renewable energy;

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potential liabilities from contamination and environmental conditions;

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potential exposure to costs and liabilities due to extensive environmental, health and safety laws;

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impacts of climate change, extreme and changing weather patterns and conditions and natural disasters;

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failure of our information technology and data security systems;

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increased competition in our markets;

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continuing to keep up with technology innovations;

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concentrated stock ownership by a few stockholders and related control over the outcome of all matters subject to a stockholder vote; and

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the other risks and uncertainties detailed in the section titled “Risk Factors.”

We make many of our forward-looking statements based on our operating budgets and forecasts, which are based upon detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results.

See the “Risk Factors” section and elsewhere in this report for a more complete discussion of the risks and uncertainties mentioned above and for discussion of other risks and uncertainties we face that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements as well as others made in our other Securities and Exchange Commission (“SEC”) filings and public communications. You should evaluate all forward-looking statements made by us in the context of these risks and uncertainties.

We caution you that the risks and uncertainties identified by us may not be all of the factors that are important to you. Furthermore, the forward-looking statements included in this report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events, or otherwise, except as required by law.

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Summary of Risks Associated with Our Business

Our business is subject to a number of risks and uncertainties, including those highlighted in the section titled “Risk Factors” in this Annual Report on Form 10-K. Some of these principal risks include the following:

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Our renewable energy projects may not generate expected levels of output.

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The concentration in revenues from five of our projects and geographic concentration of our projects expose us to greater risks of production interruptions from severe weather or other interruptions of production or transmission.

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We are not able to insure our projects against all potential risks and may become subject to higher insurance costs.

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We may face intense competition and may not be able to successfully compete.

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Technological innovation may render us uncompetitive or our processes obsolete.

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Our use and enjoyment of real property rights for our projects may be adversely affected by the rights of lienholders and leaseholders that are superior to those of the grantors of those real property rights to our projects.

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We may not be able to obtain long-term contracts for the sale of power produced by our projects on favorable terms and we may not meet certain milestones and other performance criteria under existing PPAs.

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Our commercial success depends on our ability to identify, acquire, develop and operate individual renewable energy projects, as well as our ability to maintain and expand production at our current projects.

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There may not be sufficient demand for renewable energy.

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Our fuel supply agreements with site hosts have defined contractual periods, and we cannot assure you that we will be able to successfully extend these agreements at their historic levels or at all.

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Our PPAs, fuel-supply agreements, RNG off-take agreements and other agreements contain complex price adjustments, calculations and other terms based on gas price indices and other metrics, the interpretation of which could result in disputes with counterparties that could affect our results of operations and customer relationships.

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In order to secure contracts for new projects, we typically face a long and variable development cycle that requires significant resource commitments and a long lead time before we realize revenues.

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We plan to expand our business in part through developing RNG recovery projects at landfills and livestock farms, but we may not be able to identify suitable locations or complete development of new projects.

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Our dairy farm project has, and any future digester project will have, different economic models and risk profiles than our landfill facilities, and we may not be able to achieve the operating results we expect from these projects.

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While we currently focus on converting methane into renewable energy, in the future we may decide to expand our strategy to include other types of projects. Any future energy projects may present unforeseen challenges and result in a competitive disadvantage relative to our more established competitors.

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Any future acquisitions, investments or other strategic relationships that we make could disrupt our business, cause dilution to our stockholders or harm our business, financial condition or operating results.

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Our revenues may be subject to the risk of fluctuations in commodity prices and pricing volatility of Environmental Attributes.

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We are exposed to the risk of failing to meet our contractual commitments to sell RINs from our production.

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The failure of our hedge counterparties or significant customers to meet their obligations to us may adversely affect our financial results.

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The reduction or elimination of governmental economic incentives for renewable energy projects or other related policies could adversely affect our business, financial condition and results of operation.

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We may be unable obtain, modify, or maintain the regulatory permits, approvals and consents required to construct and operate our projects.

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Negative attitudes toward renewable energy projects from the U.S. government, other lawmakers and regulators, and activists could adversely affect our business, financial condition and results of operations.

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Revenue from any projects we complete may be adversely affected if there is a decline in public acceptance or support of renewable energy, or regulatory agencies, local communities, or other third parties delay, prevent, or increase the cost of constructing and operating our projects.

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Existing regulations and policies, and future changes to these regulations and policies, may present technical, regulatory and economic barriers to the generation, purchase and use of renewable energy, and may adversely affect the market for credits associated with the production of renewable energy.

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In order to benefit from RINs and LCFS credits, our RNG projects are required to be registered and are subject to regulatory audit.

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Our business is subject to the risk of climate change and extreme or changing weather patterns.

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A failure of our IT and data security infrastructure could have a material adverse effect on our business and operations.

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Our business could be negatively affected by security threats, including cybersecurity threats and other information technology-related disruptions.

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Failure of third parties to manufacture quality products or provide reliable services in a timely manner could cause delays in developing and operating our projects, which could damage our reputation, adversely affect our partner relationships or adversely affect our growth.

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Our projects rely on interconnections to distribution and transmission facilities that are owned and operated by third parties, and as a result, are exposed to interconnection and transmission facility development and curtailment risks.

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We are dependent upon our relationships with Waste Management and Republic Services for the operation and maintenance of landfills on which several of our RNG and Renewable Electricity projects operate.

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We have significant customer concentration, with a limited number of customers accounting for a substantial portion of our revenues.

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Our fuel supply agreements with site hosts have defined contractual periods, and we cannot assure you that we will be able to successfully extend these agreements.

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Our senior credit facility contains financial and operating restrictions that may limit our business activities and our access to credit and variable rate indebtedness under the facility may adversely affect our business, financial condition and results of operations.

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We also face risks related to our common stock, being a controlled company, being an emerging growth company, and risks generally applicable to publicly-traded companies. Shares of our common stock trade on more than one stock market and this may result in price variations.

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Certain of our directors reside outside of the United States and it may be difficult to enforce judgments against them in the United States.

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