By 
Issued on behalf of Sky Quarry Inc.
Sky Quarry Inc. (NASDAQ: SKYQ) has moved its Foreland Refinery near Ely, Nevada into its production phase, with roughly 10,000 barrels of inventory on-site and more than 100,000 barrels of storage capacity, while separately working to catalyze new drilling in Railroad Valley and appointing a 35-year refining veteran to run the subsidiary.
Equity Insider News Commentary
WOODS CROSS, Utah, July 21, 2026 /PRNewswire/ -- The most important number in Western fuel markets right now is not the price of crude. It is the number of refineries left standing. Capacity across the Western United States has been retired, converted, or announced for closure at a pace that has quietly rewritten the region's fuel math, and the barrels have to come from somewhere. Against that backdrop, Sky Quarry Inc. (NASDAQ: SKYQ), an energy infrastructure company focused on domestic refining and resource development, has moved its Foreland Refinery from its preparation phase into its production phase, positioning what it describes as Nevada's only refinery inside a market that imports the overwhelming majority of the fuel it burns.
- The Company describes Foreland as the only refinery in Nevada, configured to produce diesel, vacuum gas oil (VGO), naphtha and asphalt for western U.S. markets, in a state that imports more than 90% of its transportation fuels.
- Sky Quarry has launched an initiative to catalyze new drilling in Nevada's Railroad Valley and intends to refine that local crude at Foreland; a 2025 U.S. Geological Survey assessment estimated Nevada holds approximately 1.4 billion barrels of undiscovered, technically recoverable oil beneath federal lands.
- The Company appointed Ray Hansen, a 35-year refining veteran formerly of HF Sinclair, CITGO and Chevron, as President of its wholly owned subsidiary Foreland Refining Corporation.
- Investors tracking refining and Western fuel logistics follow public names including Valero Energy (NYSE: VLO), Par Pacific Holdings (NYSE: PARR), Delek US Holdings (NYSE: DK), and HF Sinclair (NYSE: DINO), each distinct, and none a proxy for Sky Quarry.
Entering the Production Phase
For most of its recent history, Sky Quarry has been a story about what an asset could become. Management's focus, by the Company's own account, was on repairing infrastructure, securing working capital, strengthening the balance sheet, and preparing Foreland for operations. Those are the unglamorous years, and they do not generate revenue.
That preparation phase has now given way to the next one. Sky Quarry announced that Foreland has entered its production phase, and the Company has been explicit about what the shift means for how the asset should eventually be assessed. The refinery has historically been valued through the lens of its potential; as the production phase progresses, the Company expects it to be judged instead on operational performance, cash-generating capability, and its strategic position within the Western fuel market. That is a change in the terms of the argument rather than a change in the financials, and it will take time to show up in either.
Two details give the phase some substance. The Company reports entering it with approximately 10,000 barrels of crude and in-process inventory already on-site and moving through the refining process, which it frames as both operational readiness and an immediate working asset. And recent work has included repairs, upgrades, and enhancements across critical operating systems, including storage infrastructure giving the Company more than 100,000 barrels of capacity, which Sky Quarry expects to provide operational flexibility and represent an important component of the refinery's long-term value.
The Capacity Story Nobody Planned
The reason any of this matters sits outside Sky Quarry entirely. Several large refining facilities in California have recently either ceased operations or announced plans to do so, removing meaningful capacity from the Western market. No single closure defines a market, but the direction has been consistent enough to become the defining feature of the region's fuel supply.
Sky Quarry's Interim CEO Marcus Laun has put the Company's thesis plainly. "While energy markets often focus on fluctuations in crude oil prices, the more important long-term trend, in my opinion, is the continued reduction of refining capacity across the Western United States," he said. "As refining capacity exits the market and regional demand for transportation fuels remains resilient, strategically located refining infrastructure is expected to become increasingly valuable."
The market has been pricing something like that view. Refining equities have had an extraordinary run in 2026: Valero is up roughly 83% on the year, Par Pacific has more than doubled at around 108%, Delek has climbed roughly 103%, and HF Sinclair is ahead roughly 79%, with several names near multi-year highs. That is what a market repricing scarce capacity looks like. It is also a reminder that refining is famously cyclical.
Nevada sits at the sharp end of the imbalance, relying on fuel imported from neighboring regions, much of it from supply-constrained California. More than 90% of its transportation fuels come from outside the state. A refinery inside that market, in the Company's telling, occupies a unique position in the supply chain, with the potential to serve customers across the broader Intermountain West.
Barrels in the Backyard
The second half of Sky Quarry's strategy addresses the other end of the pipe: where the crude comes from.
In June, the Company announced a crude oil drilling and production initiative in Nevada's Railroad Valley, the state's primary oil-producing region, with the intention of refining that crude at Foreland. The resource backdrop is striking. According to a 2025 U.S. Geological Survey assessment, Nevada holds approximately 1.4 billion barrels of undiscovered, technically recoverable oil beneath federal lands, the third largest such resource of any state, behind only Alaska and New Mexico. A state sitting on the third-largest federal onshore oil endowment in the country imports more than nine out of every ten gallons it burns.
The logic of pairing the two rests on a quirk of geography. Because Railroad Valley has limited pipeline access to outside markets, it is generally more economical to refine locally, giving Foreland a natural advantage in securing supply. The Company is working to catalyze new drilling in the basin and positioning Foreland to refine the barrels those efforts could deliver.
Laun framed the ambition against the basin's history. "At its peak, Railroad Valley wells produced roughly 5,000 barrels per day, and we believe more wells with that kind of productivity are still possible," he said. "More production would strengthen Nevada's energy infrastructure and increase the amount of locally produced crude available for refining in-state."
The caution is the one that applies to any drilling program: undiscovered, technically recoverable is a geological estimate, not a bank balance. Those barrels have to be found, permitted, drilled, and produced economically by third-party operators before a single one reaches Foreland's gate.
Hiring for the Next Phase
Companies signal what they think they are becoming by who they hire, and in July Sky Quarry named Ray Hansen President of Foreland Refining Corporation, its wholly owned subsidiary.
Hansen's background is operations, not promotion. He brings more than 35 years of refining experience, including senior leadership positions with HF Sinclair, CITGO Petroleum, and Chevron. Most recently he served as Vice President of HF Renewable Fuels, and before that he led operations at HF Sinclair's 140,000 barrel-per-day El Dorado refinery, responsible for operations, engineering, logistics, environmental performance, and more than 260 personnel. His mandate covers both the Foreland Refinery and the continued development of PR Spring, Sky Quarry's oil sands processing facility in Vernal, Utah.
"Ray has successfully led large-scale refinery operations, including the execution of a highly successful renewable fuels conversion project," said Laun. "That's the kind of operational focus we need at Foreland Refining as we look to ramp production and prepare PR Spring for its next stage of development."
Hansen's own read was telling: "I've learned that some of the greatest gains can come from unlocking potential from existing assets, and I see similar opportunities here."
There is a scale point worth naming. El Dorado runs 140,000 barrels per day. Foreland is far smaller. The question is not whether Hansen has run bigger plants, it is whether big-refinery operating discipline transfers to a small one, and that is a reasonable bet rather than a certainty.
What Actually Has to Go Right
Sky Quarry now holds a combination of assets that is difficult to assemble from scratch: refining infrastructure, substantial storage, access to regional crude supply, operating permits, customer relationships, and a location inside a fuel-deficient market. Permits alone are a meaningful barrier; building a new refinery in the United States is, for practical purposes, not something that happens anymore. That scarcity is the Company's core argument.
But entering a production phase is a beginning, not an achievement. Sky Quarry's economics are driven primarily by refining margins rather than crude prices alone, and margins are volatile, cyclical, and outside any operator's control. The Company has to bring the plant to sustained, reliable operation: safely, at rising rates, without the unplanned downtime and equipment failures that punish small refiners hardest. It has to attract customers, manage costs, and maintain liquidity. Railroad Valley depends on third-party producers making their own drilling decisions and on permits nobody has issued. And the refining cycle that has been so generous in 2026 will not stay generous forever.
The Public Companies in Refining
Sky Quarry is a small-cap company at the start of its production phase and is not directly comparable to the names below. These comparisons are for industry context only; each pursues a different asset base and business model, all four are substantially larger, revenue-generating, and long established, and none is a proxy for Sky Quarry or implies any partnership, endorsement, or comparable performance. The refining group has run hard in 2026, and past sector performance is not indicative of future results.
Valero Energy (NYSE: VLO) is the largest pure-play refiner by capacity in the United States, operating a highly complex system able to process a wide range of feedstocks including heavy sour crude. Valero represents the scale end of the business, and its commentary on constrained global crude and refined product supply speaks to the same capacity tightness underpinning Sky Quarry's regional thesis, at a vastly different size.
Par Pacific Holdings (NYSE: PARR) is a Houston-based refiner with roughly 219,000 barrels per day of combined capacity concentrated in Hawaii and the Pacific Northwest. Par Pacific is the closest structural analogue in the group, built around refining in isolated Western markets where local capacity carries a logistical advantage over imported product, which is precisely the argument Sky Quarry makes for Nevada, at far larger scale.
Delek US Holdings (NYSE: DK) operates four refineries across Texas, Arkansas, and Louisiana alongside an integrated logistics network. As one of the smaller independents whose earnings swing hard on crack spreads, Delek illustrates both the leverage and the concentration risk of operating a limited number of refining sites.
HF Sinclair (NYSE: DINO) is the mid-cap independent of the group, with a mid-continent focus and a renewable fuels business alongside conventional refining. It is directly relevant here for a specific reason: Sky Quarry's new Foreland president came from its ranks, having led its 140,000 barrel-per-day El Dorado refinery and its renewable fuels division.
The Bottom Line
Entering a production phase is not the same as generating cash, and Sky Quarry remains a small company whose refinery has only just reached that phase, whose Railroad Valley ambitions depend on other people's drilling decisions and permits not yet in hand, and whose margins sit at the mercy of a notoriously cyclical business.
But the backdrop is genuinely favorable, and it is not of the Company's making. Western refining capacity has been leaving the market, Nevada imports more than 90% of its fuel while sitting on an estimated 1.4 billion barrels beneath federal land, and replacement capacity has become, for practical purposes, unbuildable. Sky Quarry has spent years positioning a single asset for exactly that setup, and it has now moved that asset out of preparation and into its production phase. For investors tracking how scarce Western refining infrastructure gets valued as the region's capacity math tightens, the markers worth watching are how the production phase progresses at Foreland, the first evidence of operating margins and cash flow, permit progress and new wells in Railroad Valley, and what Hansen's discipline does to the asset.
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