Company: REX
Filing Date: 2025-06-04
Form Type: 10-Q
Source: 0000930413-25-001941
Chunk: 104

Company: REX AMERICAN RESOURCES Corp
Filing Date: 2025-06-04
Form: 10-Q
Item: Part I, Item 2
Chunk 104
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inois Senate Bill 3968 was introduced
during the 2024 legislative session and assigned to the Senate Executive Committee. The bill proposed banning carbon sequestration
projects located over, under, or through a sole-source aquifer, including the three adjacent watersheds that make up the Mahomet
Sole Source Aquifer Project Review Area, a designation established by the EPA in March 2015. However, SB 3968 did not advance
and was not enacted during that session. In the 2025 legislative session, Senate Bill 1723 was introduced with an amendment that
defined the term “sole-source aquifer” to specifically refer to the Mahomet Sole Source Aquifer Area, as defined by
the EPA. Under this definition, SB 1723 would prohibit carbon sequestration activities over, under, or through the aquifer as
defined in the bill. The Illinois Senate passed SB 1723 on April 10, 2025 and on May 20, 2025, the Illinois House of Representatives
approved the bill. The legislation now awaits the Governor’s consideration and potential signature into law. The first proposed
injection well for our carbon sequestration project is located in the northern portion of the Sangamon River near Fisher Upstream
Area watershed, and it lies outside the mapped boundary of the Mahomet Sole Source Aquifer as defined in SB 1723, approximately
five miles north of the Sangamon River and about six miles beyond the aquifer’s mapped boundary. The second and third proposed
injection well sites are also located outside the areas designated as part of the Mahomet Sole Source Aquifer Project Review Area.
The Company continues to closely monitor the progress of SB 1723 and is actively evaluating any potential implications it may
have for the development and permitting of our carbon sequestration project.

29

Additionally, see “One Earth Energy,
LLC Carbon Sequestration and Plant Expansion” above for a discussion of certain other uncertainties associated with our
Illinois carbon sequestration and plant expansion projects.

On August 10, 2017, we purchased, through
a 95.35% owned subsidiary, the entire ownership interest of an entity that owned a refined coal facility. We began operating the
refined coal facility immediately after the acquisition. As the plant was no longer eligible to receive federal production tax
credits beginning on November 18, 2021, we ceased operations on that date and subsequently sold the facility. The approximately
$58.