When renewable and refined come together

Rachel Sankey

Past Staff

July 5, 2023

APPLETON – Bringing U.S. Oil and U.S. Gain, two companies under U.S. Venture – which focuses on data and distribution of transportation-related consumables – together to create U.S. Energy, Mike Koel, president of the company, said was more of a reunion than a merger. 

“U.S. Oil focused on refined products distribution,” he said. “U.S. Gain – (which) was spun up originally with U.S. Oil – then became its own entity with a focus of providing sustainable energy solutions that help decarbonize transportation.” 

Then a year and a half ago, Koel said the idea to bring the two groups back together to “serve as a holistic energy group” was sparked.

“It started as an idea to gain operational efficiencies, but quite honestly reflected a lot of what we continue to see in the market today,” he said. “It isn’t a fossil fuels business versus a renewable business. The more we get out and talk with different fleet clients and energy companies, it’s this combined polyfuel future we’re seeing.”

Perfect timing 
Koel said “the timing was right to bring the groups back together,” especially since the demand from clients has grown.

“Our refined products business – that sales team has been getting questions about renewable diesel and renewable natural gas,” he said. “Conversely, the folks out selling some of the alternatives are getting asked more questions (like) ‘what can you do for me and location XYZ with regards to diesel supply?’”

Part of this, Koel said, is due to refined product businesses wanting to get into that “green space.”

Or, he said, fleet management is being given directives to incorporate renewable alternatives or some type of carbon reduction initiatives, but don’t know where to start.

“Bringing together the capabilities and expertise allows us to create more (of a relationship) with existing customers and serve a greater purpose,” he said. “The timing felt right.”

Koel also said it was important to the company to call the transition a reunion, instead of a merger.

“(The word) ‘merger’ itself can have a negative connotation where it’s one company coming in and taking over another,” he said. “With (U.S. Oil and U.S. Gain) both being sister divisions under the U.S. Venture family of brands, ‘reunion’ felt a little more cohesive of a term.”

A deeper look at U.S. Energy
While U.S. Oil and U.S. Gain have come together, the inside operations and positions look much the same, Koel said, though now the teams work off one another. 

For both businesses, he said part of the strategy is to build assets that enable the supply of energy into markets, such as standalone oil terminals or alternative fueling stations.

//17bec5072710cda5b8dd81b69f4c6e58.cdn.bubble.io/f1688574400629x806023607985296500/richtext_content.webpOne benefit of combining U.S. Oil and U.S. Gain, President Mike Koel said, was tapping into U.S. Oil’s engineering team to discover process efficiencies and optimize site builds. Photo Courtesy of U.S. Energy

U.S. Oil, Koel said, had a team behind the scenes that would design, build and maintain a project.

He said U.S. Gain also had a team that focused on ops and engineering but had to outsource “quite a bit” of the work.

“The quickest synergy we’ve been able to realize is to tap into U.S. Oil – specifically their wide engineering team – to make sure we can create some efficiencies, leveraging expertise to make sure we’re optimizing our site builds,” he said. 

Within the energy sector, Koel said compliance (which includes clean fuel programs and credits from the government) has also become a hot topic of discussion.

“Whenever there is free money, there are requirements to get said money,” he said. “We had two different compliance teams – one was more alternative-fuel focused and one (that was) refined products focused. Bringing those together was so incredibly helpful because we were able to optimize processes and expedite some of the credit generation aspects on behalf of our counterparties.”

To make the reunion of the two companies as smooth as possible, Koel said U.S. Energy’s marketing team is working on a new go-to market strategy to help “our teams more cohesively sell the whole portfolio.”

“Because now, they’re empowered to sit across the table from a business leader and talk about anything from diesel supply to renewable natural gas utilization…” he said. “We need to make sure our teams are fully educated on those capabilities.”

This, Koel said, also allows for all parts of the U.S. Energy team to be on the same page and learn from one another.

“Now that we’re all sitting in the same room and having the same conversations on our team, we’re able to hear more about what’s happening across different parts of the supply chain, whereas before we might have gotten a little more siloed in the refined products or the renewables,” he said.

Transition-wise, Koel said it should feel pretty seamless for both new and existing customers.

“I see that being a real big differentiator for us now going to market with our customers,” he said. “Before, it’s not like we couldn’t technically offer the same suite of solutions. But say on the U.S. Gain side, people were looking for diesel or gasoline products, we had to almost do a handoff, like ‘We can refer you to our counterpart on the U.S. Oil side,’ whereas now it’s all under that one brand.”

//17bec5072710cda5b8dd81b69f4c6e58.cdn.bubble.io/f1688574526433x313017155903232000/richtext_content.webpMike Koel

The new name itself – U.S. Energy – is also a benefit of the reunion, Koel said. 

“We were intentional about maintaining the ‘U.S.’ because that ties to our corporate entity, U.S. Venture,” he said. “But from an energy perspective, we wanted to leave that door strategically wide open.”

And, though U.S. Energy is currently focused on refined products, alternative fuels and environmental credits, Koel said there are other avenues the company is looking at, such as soil enrichment and carbon capture – which can all fall under the U.S. Energy name.

“So, pieces that necessarily aren’t something people would think of (with) U.S. Gain or U.S. Oil today, those are the kind of components we want to blend into the future so we can continue to evolve with, and in some cases ahead of, the industry so we’re ready for that next client need,” he said. 

Sustainability aspect
In a time where there’s a “sustainability evolution taking place,” Koel said bringing U.S. Oil and U.S. Gain together gives the U.S. Energy team a leg up.

“(It allows clients) to figure out how to become greener throughout their operations without sacrificing the economic and operational expectations,” he said.

However, Koel said going green isn’t necessarily a quick flip.

“There might be a desired end state, but either from a cost-perspective (or) technology perspective, there could be regulation standing in the way,” he said. “There are many ‘Yeah, but’s’ we hear from our customers that result in them taking a more staggered approach from an integration of sustainable solutions throughout their operations.”

Regardless of what clients are looking for and the pace they grow at in terms of sustainability, Koel said the U.S. Energy team is there to help. 

“We’re not just solutions providers, but we’re on the journey with them so they can make the right decision,” he said. 

Koel said U.S. Energy also has an internal strategy team and government affairs team that can help find the best option for customers.

“Whether it’s (a company) converting their fleets (to a new fuel source) 100% by next year pending availability of infrastructure – or maybe they want a gradual transition over 20 years,” he said. “We can customize what solutions we offer them to fit their best economic and environmental goals.”

An example of this, Koel said, is convenience (C) store owners reaching out regarding electric vehicle (or EV) charging stations.

//17bec5072710cda5b8dd81b69f4c6e58.cdn.bubble.io/f1688574546845x943430063412231300/richtext_content.webpWith the reunion of U.S. Oil and U.S. Gain, the two teams have collectively come together to bring both refined and renewable energy solutions. Photo Courtesy of U.S. Energy

“Those C store owners have been coming to our U.S. Oil team trying to understand, ‘When should I put in (a) charging (station)? What does that look like for me?’” he said. “They’re nervous they’re going to lose a large portion of their business because of this evolution and technology. I think having that comprehensive knowledge base of where energy is going and how to best bring it into your operations is going to help set our customers apart and help them stay ahead of the market.”

Keeping the culture
Leadership- and employee-wise, both Koel said not much has changed.

Eric Kessenich, who led U.S. Oil and was promoted to chief operating officer of U.S. Venture in 2022, oversees all U.S. Energy and its sister companies.

Both teams at U.S. Oil and U.S. Gain have fostered a great culture, Stephanie Lowney, vice president of marketing, strategy and innovation, said, and Koel continues to grow a healthy team now that the two have become one.

“I think the cool touch Mike brings is his focus on culture,” she said. “Mike’s vision is to try and figure out how we can build upon that… he was very conscious to allocate his time so it was balanced across the groups and understood that everyone was heard because he was intentional not to have an ‘us versus them’ mentality.”

The effort put in for the new collective culture, Lowney said, has helped build up a strong team.

“We’re entrepreneurial as a group and empowered to pursue new business ventures and ideas,” she said. “Pairing that with our commitment to philanthropic outreach, we’re able to make an impact within the communities we live and operate.”

To learn more about U.S. Energy and what it offers, head to us-energy.com.