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Icahn subpoenaed on RINs, presidential advisory role

8 Nov 2017, 8.01 pm GMT

Icahn subpoenaed on RINs, presidential advisory role

Houston, 8 November (Argus) — Federal investigators subpoenaed at least three companies for information on investor and former presidential adviser Carl Icahn's "activities relating to the Renewable Fuels Standard," according to corporate disclosures.

Icahn Enterprises, CVR Energy and CVR Refining were complying with inquiries by the Southern District of New York US Attorney's office, the companies said in quarterly statements.

Icahn was an outspoken critic of US biofuel blending mandates who served as what the administration described as an informal adviser on cutting regulation to President Donald Trump. He abruptly stepped down from that role in August. CVR Energy, in which Icahn holds an 82pc ownership interest, has pushed for changes to the mandates as the refiner's costs to comply with the program have climbed.

"The US Attorney's office has not made any claims or allegations against us or Mr. Icahn," the disclosure said. "We maintain a strong compliance program and, while no assurances can be made, we do not believe this inquiry will have a material impact on our business, financial condition, results of operations or cash flows."

The US Attorney's office declined to comment. Icahn and CVR Energy could not be immediately reached for comment.

The Renewable Fuels Standard requires that refiners, importers and other companies ensure minimum volumes of renewable fuels enter the US transportation supply each year. Companies that blend fuels with renewable fuels generate markers, called renewable identification numbers (RINs), needed to prove compliance with the law.

The markers can be gathered by obligated blenders or sold to companies needing the credits. Merchant refiners, including CVR Energy, Valero and PBF Energy, have complained that the program gives unobligated blenders leverage to raise costs for refiners without increasing renewable fuel blending. CVR expected to spend up to $265mn on the program this year.

Icahn and refiners sought to make more companies, including major blenders, obligated to meet the annual requirements. Prices for the credits plummeted last December after Trump announced Icahn's advisory role. Senators repeatedly requested documents related to Icahn's advisory role this year, with little success.

But RIN prices have climbed as the new administration's inclination to change the program has fallen. Environmental Protection Agency administrator Scott Pruitt said in October that the agency will formally reject that proposal this month.

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