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What changed in PAR PACIFIC HOLDINGS, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of PAR PACIFIC HOLDINGS, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+346 added−305 removedSource: 10-K (2025-02-28) vs 10-K (2023-12-31)

Top changes in PAR PACIFIC HOLDINGS, INC.'s 2024 10-K

346 paragraphs added · 305 removed · 234 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

67 edited+32 added−22 removed92 unchanged
Biggest changeThis SPM allows for the safe, reliable, and efficient receipt of crude oil shipments to the Hawaii refinery, as well as both the receipt and export of finished products. Connecting the SPM to the Hawaii refinery are three undersea pipelines, two for the import or export of refined products and one for crude oil.
Biggest changeHawaii Logistics Our logistics network extends throughout the State of Hawaii. On Oahu, the system begins with our SPM located 1.7 miles offshore of our Hawaii refinery. This SPM allows for the safe, reliable, and efficient receipt of crude oil shipments to the Hawaii refinery, as well as both the receipt and export of finished products.
The Washington Department of Ecology (“WDOE”) issued final rules implementing the LCFS effective on January 1, 2023, implementing requirements that are now in effect and will gradually reduce the carbon intensity of fuels sold in the state over time by annually lowering that limit.
The Washington Department of Ecology (“WDOE”) issued final rules implementing the LCFS effective on January 1, 2023, and requirements are now in effect and will gradually reduce the carbon intensity of fuels sold in the state over time by annually lowering that limit.
We cannot predict what effect additional regulation or legislation, enforcement policies, and claims for damages to property, employees, other persons, and the environment resulting from our operations could have on our activities. Periodically, we receive communications from various federal, state, and local governmental authorities asserting violations of environmental laws and/or regulations.
We cannot 6 predict what effect additional regulation or legislation, enforcement policies, and claims for damages to property, employees, other persons, and the environment resulting from our operations could have on our activities. Periodically, we receive communications from various federal, state, and local governmental authorities asserting violations of environmental laws and/or regulations.
Although we and, to our knowledge, our predecessors have used operating and disposal practices that were 8 standard in the industry at the time, “hazardous substances” may have been disposed or released on, under, or from the properties currently or historically owned or leased by us or on, under, or from other locations where these wastes have been taken for disposal.
Although we and, to our knowledge, our predecessors have used operating and disposal practices that were standard in the industry at the time, “hazardous substances” may have been disposed or released on, under, or from the properties currently or historically owned or leased by us or on, under, or from other locations where these wastes have been taken for disposal.
Please read Note 3—Refining and Logistics Equity Investments to our consolidated financial statements under Item 8 of this Form 10-K for further information. 5 ENVIRONMENTAL REGULATIONS General Our activities are subject to existing federal, state, and local laws and regulations governing environmental quality and pollution control.
Please read Note 3—Refining and Logistics Equity Investments to our consolidated financial statements under Item 8 of this Form 10-K for further information. ENVIRONMENTAL REGULATIONS General Our activities are subject to existing federal, state, and local laws and regulations governing environmental quality and pollution control.
All readers are cautioned that the forward- 11 looking statements contained in this Annual Report on Form 10-K are not guarantees of future performance and we cannot assure any reader that such statements will be realized or that the forward-looking events and circumstances will occur.
All readers are cautioned that the forward-looking statements contained in this Annual Report on Form 10-K are not guarantees of future performance and we cannot assure any reader that such statements will be realized or that the forward-looking events and circumstances will occur.
To the extent that refiners will not or cannot blend renewable fuels into the products they produce 7 in the quantities required to satisfy their obligations under the RFS program, those refiners must purchase renewable credits, referred to as Renewable Identification Numbers (“RINs”), to maintain compliance.
To the extent that refiners will not or cannot blend renewable fuels into the products they produce in the quantities required to satisfy their obligations under the RFS program, those refiners must purchase renewable credits, referred to as Renewable Identification Numbers (“RINs”), to maintain compliance.
The RFS may present production and logistics challenges for both the renewable fuels and the petroleum refining and marketing industries in that we may have to enter into arrangements to purchase RINs with other parties or purchase cellulosic biofuels RINs (“D3”) waivers from the EPA to meet our obligations to use advanced biofuels, including biomass-based diesel and cellulosic biofuel, with potentially uncertain supplies of these new fuels.
The RFS presents production and logistics challenges for both the renewable fuels and the petroleum refining and marketing industries in that we may have to enter into arrangements to purchase RINs with other parties or purchase cellulosic biofuels RINs (“D3”) waivers from the EPA to meet our obligations to use advanced biofuels, including biomass-based diesel and cellulosic biofuel, with potentially uncertain supplies of these new fuels.
As of December 31, 2023, through the Billings Acquisition (as defined in Note 5—Acquisitions under Item 8 of this Annual Report on Form 10-K), we own a 65% and a 40% equity investment in Yellowstone Energy Limited Partnership (“YELP”) and Yellowstone Pipeline Company (“YPLC”), respectively. Our Corporate and Other reportable segment primarily includes general and administrative costs.
As of December 31, 2024, through the Billings Acquisition (as defined in Note 5—Acquisitions under Item 8 of this Annual Report on Form 10-K), we own a 65% and a 40% equity investment in Yellowstone Energy Limited Partnership (“YELP”) and Yellowstone Pipeline Company (“YPLC”), respectively. Our Corporate and Other reportable segment primarily includes general and administrative costs.
All our refineries are Tier 3 compliant. In addition to federal requirements, several states, including Washington, have proposed or enacted low carbon fuel standards applicable to transportation fuels. The Washington LCFS creates a carbon intensity score for transportation fuels and require fuel producers and importers who fall short of increasingly stringent annual carbon intensity goals to purchase credits.
All our refineries are Tier 3 compliant. In addition to federal requirements, several states, including Washington, have proposed or enacted low carbon fuel standards applicable to transportation fuels. The Washington LCFS creates a carbon intensity score for transportation fuels and requires fuel producers and importers who fall short of increasingly stringent annual carbon intensity goals to purchase credits.
OTHER OPERATIONS Laramie Energy As of December 31, 2023, we owned a 46% equity investment in Laramie Energy, an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.
OTHER OPERATIONS Laramie Energy As of December 31, 2024, we owned a 46% equity investment in Laramie Energy, an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.
The Montana refinery is a high-conversion, complex facility that processes low-cost Western Canadian and regional Rocky Mountain crude oil to produce gasoline, distillate, asphalt, and other products to serve the Rocky Mountain region. Our Montana refinery assets include a 65% interest in an adjacent co-generation facility.
The Montana refinery is a high-conversion, complex facility that processes low-cost Western Canadian and regional Rocky Mountain crude oil to produce gasoline, distillate, asphalt, and other products to serve the Rocky Mountain region. Our Montana refinery assets include a 65% interest in YELP, which owns an adjacent co-generation facility.
For each of the years ended December 31, 2023, 2022, and 2021, we had one customer in our refining segment that accounted for 13%, 17%, and 13%, respectively, of our consolidated revenue. No other customer accounted for more than 10% of our consolidated revenues during the years ended December 31, 2023, 2022, and 2021.
For each of the years ended December 31, 2024, 2023, and 2022, we had one customer in our refining segment that accounted for 12%, 13%, and 17%, respectively, of our consolidated revenue. No other customer accounted for more than 10% of our consolidated revenues during the years ended December 31, 2024, 2023, and 2022.
From the Hawaii refinery, we distribute refined products through our logistics network of pipelines, trucks, leased barges, terminals, and storage facilities throughout the islands of Oahu, Maui, Hawaii, Molokai, and Kauai and for export to the U.S. West Coast and Asia.
From the Hawaii refinery, we distribute refined products through our logistics network of pipelines, trucks, leased barges, terminals, and storage facilities throughout the islands of Oahu, Maui, Hawaii, Molokai, and Kauai and for export to the U.S.
Our Washington refinery is located in Tacoma, Washington, and is rated a t 42 Mbpd throughput capacity. The Washington refinery’s major processing units produce ULSD, jet fuel, gasoline, asphalt, and other associated refined products that are primarily marketed in the Pacific Northwest.
Our Washington refinery is located in Tacoma, Washington, and is rated at 42 Mbpd throughput capacity. The Washington refinery’s major processing units produce ULSD, jet fuel, gasoline, asphalt, and other associated refined products that are primarily marketed in the Pacific Northwest (“PNW”).
This network includes an SPM in Hawaii, a unit train-capable rail loading terminal in Washington, and other terminals, pipelines, trucking operations, marine vessels, storage facilities, loading and truck racks, and rail facilities for the movement of petroleum, refined products, and ethanol in and among the Hawaiian islands, between the U.S. West Coast, and the Rocky Mountain region.
This network includes an SPM in Hawaii, a unit train-capable rail loading terminal in Washington, and other terminals, pipelines, trucking operations, marine vessels, storage facilities, loading and truck racks, and rail facilities for the movement of petroleum, refined products, and ethanol in and among the Hawaiian islands, between the U.S.
Bureau of Economic Analysis (the “BEA”), gross domestic product (“GDP”) for the State of Washington grew by 5.4% from 2022 to 2023 based on seasonally adjusted preliminary third quarter 2023 data.
Bureau of Economic Analysis (the “BEA”), gross domestic product (“GDP”) for the State of Washington grew by 5.1% from 2023 to 2024 based on seasonally adjusted preliminary third quarter 2024 data.
Washington Logistics Our Washington logistics network includes storage capacity, a proprietary jet fuel pipeline that serves Joint Base Lewis McChord, a marine terminal with waterfront property, a unit train-capable rail loading terminal, a manifest rail siding, including asphalt, butane, biodiesel loading and unloading facilities, and a truck rack.
Our Montana logistics network services the PADD IV and V regions. Washington Logistics Our Washington logistics network includes storage capacity, a proprietary jet fuel pipeline that serves Joint Base Lewis McChord, a marine terminal with waterfront property, a unit train-capable rail loading terminal, a manifest rail siding, including asphalt, butane, biodiesel loading and unloading facilities, and a truck rack.
The EPA continues to review and, in many cases, tighten ambient air quality standards, which standards, along with the advancement of pollution control technologies, could result in new regulatory and permit requirements that will impact our refining activities and involve additional costs.
The EPA continues to review and, in many cases, tighten ambient air quality standards, which standards, along with the advancement of pollution control technologies, could result in new regulatory and permit requirements that will impact our refining activities and involve additional costs. The EPA also regularly conducts compliance inspections related to these requirements.
Please read Note 23—Segment Information to our consolidated financial statements under Item 8 of this Form 10-K for detailed information on our operating results by segment. Macroeconomic Factors Affecting Our Business U.S. and Global Inflationary Factors. Energy prices are, among other factors, indicators of inflation, and the U.S.
Please read Note 23—Segment Information to our consolidated financial statements under Item 8 of this Form 10-K for detailed information on our operating results by segment. Macroeconomic Factors Affecting Our Business U.S. and Global Inflationary Factors. Energy prices are, among other factors, indicators of inflation, and the U.S. Federal Reserve (the “Fed”) has taken significant steps to curb inflation.
According to the Spokane City Department of Economic Development, the unemployment rate was 3.4% through September 2023, and the average annual wage was $62 thousand in the first quarter of 2023 in positions covered by unemployment insurance. A significant portion of the products produced by our Washington refinery stay within the Puget Sound region.
According to the Spokane City Department of Economic Development, the unemployment rate 5 was 4.8% through July 2024, and the average annual wage was $62 thousand in the fourth quarter of 2023 in positions covered by unemployment insurance. A significant portion of the products produced by our Washington refinery stay within the Puget Sound region.
Alternatively, you may access these reports at the SEC’s website at www.sec.gov . OPERATING SEGMENTS Refining We own and operate refineries in Hawaii, Wyoming, Washington, and Montana, with total operating crude oil throughput capacity of 219 Mbpd. During the year ended December 31, 2023, our refineries processed 170.3 Mbpd of crude oil and sold 183.1 Mbpd of refined products.
Alternatively, you may access these reports at the SEC’s website at www.sec.gov . OPERATING SEGMENTS Refining We own and operate refineries in Hawaii, Wyoming, Washington, and Montana, with total operating crude oil throughput capacity of 219 Mbpd. During the year ended December 31, 2024, our refineries processed 186.7 Mbpd of crude oil and sold 199.9 Mbpd of refined products.
The South Dakota economy is anchored by tourism, including visitors to Mount Rushmore and the Black Hills, as well as government and health care spending. According to the South Dakota Department of Tourism, visitor spending has increased in 2023, above pre-pandemic levels.
The South Dakota economy is anchored by tourism, including visitors to Mount Rushmore and the Black Hills, as well as government and health care spending. According to the South Dakota Department of Tourism, visitor spending increased in 2024.
At December 31, 2023, our workforce consisted of 1,814 employees, including 331 employees, or 18% of our total workforce, at our Hawaii, Washington, and Montana refineries represented by the United Steelworkers Union (“USW”) with collective bargaining agreements effective through January 31, 2026.
At December 31, 2024, our workforce consisted of 1,787 employees, including 403 employees, or 23% of our total workforce, at our Hawaii, Washington, and Montana refineries represented by the United Steelworkers Union (“USW”) with collective bargaining agreements effective through January 31, 2026.
We believe the RVO Adjusted USGC 3-2-1 is the most representative market indicator for our operations in Billings, Montana. The RVO Adjusted USGC 3-2-1 Index is computed by taking three barrels of WTI crude oil and converting them into two barrels of USGC gasoline and one barrel of USGC ULSD, less 100% of the RVO cost. Washington Refinery.
Prior to 2025, the RVO Adjusted USGC 3-2-1 Index was the most representative market indicator for our operations in Billings, Montana, which was computed by taking three barrels of WTI crude oil and converting them into two barrels of USGC gasoline and one barrel of USGC ULSD, less 100% of the RVO cost.
Montana Logistics On June 1, 2023, we purchased distribution and logistics assets in the upper Rockies region, including the wholly owned Silvertip Pipeline, a 40% interest in the Yellowstone refined products pipeline, and four wholly owned and three joint venture refined product terminals located in Montana and Washington. Our Montana logistics network services the PADD IV and V regions.
West Coast and Asia. 4 Montana Logistics On June 1, 2023, we purchased distribution and logistics assets in the upper Rockies region, including the wholly owned Silvertip Pipeline, a 40% interest in the Yellowstone refined products pipeline, and four wholly owned and three joint venture refined product terminals located in Montana and Washington.
The DOH issued a GHG permit, which caps GHG emissions from both refineries at 904,945 metric tons per year which (as required by regulation) is 16% below the combined facility GHG emission levels of 2010.
The DOH issued a GHG permit, which caps GHG emissions from both refineries at 904,945 metric tons per year which (as required by regulation) is 16% below the combined facility GHG emission levels of 2010. Since ceasing refining operations at the Par West facility in 2020, our annual emissions are well below the GHG emissions cap.
We also have an on-shore pipeline manifold which allows for crude oil to be transferred between the Hawaii refinery and the IES Downstream, LLC (“IES”) storage facility located approximately 2 miles away.
Connecting the SPM to the Hawaii refinery are three undersea pipelines, two for the import or export of refined products and one for crude oil. We also have an on-shore pipeline manifold which allows for crude oil to be transferred between the Hawaii refinery and the IES Downstream, LLC (“IES”) storage facility located approximately 2 miles away.
As of December 31, 2023, we owned a 46% equity investment in Laramie Energy, LLC (“Laramie Energy”), an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.
West Coast and Hawaii, and in areas ranging from the state of Washington to the Dakotas and Wyoming. As of December 31, 2024, we owned a 46% equity investment in Laramie Energy, LLC (“Laramie Energy”), an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.
While these programs are not expected to result in a material impact to earnings in the immediate term, both programs involve gradual tightening of standards over time and will likely require us to take additional actions or credit purchases, some of which may eventually be material. Both programs are likely to reduce transportation fuel demand.
Both programs involve 7 gradual tightening of standards over time which will likely require us to take additional actions or credit purchases, some of which may eventually be material. Both programs are likely to reduce transportation fuel demand.
The RVO Adjusted Pacific Northwest 3-1-1-1 Index is computed by taking one part gasoline (PNW sub-octane), one part distillate (PNW ULSD), and one part VGO (USGC VGO) as created from three barrels of WTI Crude, less 100% of the RVO cost for gasoline and distillate. In 2 January 2024, our Washington refinery was awarded the U.S.
Prior to 2025, the RVO Adjusted Pacific Northwest 3-1-1-1 Index was the most representative market indicator for our operations in Tacoma, Washington, which was computed by taking one part gasoline (PNW sub-octane), one part distillate (PNW ULSD), and one part VGO (USGC VGO) as created from three barrels of WTI Crude, less 100% of the RVO cost for gasoline and distillate.
The federal Coastal Zone Management Act (“CZMA”) was passed to preserve and, where possible, restore the natural resources of the coastal zone of the U.S. The CZMA provides for federal grants for state management programs that regulate land use, water use, and coastal development.
Coastal Coordination There are various federal and state programs that regulate the conservation and development of coastal resources. The federal Coastal Zone Management Act (“CZMA”) was passed to preserve and, where possible, restore the natural resources of the coastal zone of the U.S.
Logistics Our logistics segment generates revenues by charging fees for transporting crude oil to our refineries, delivering refined products to wholesale and bulk customers and to our retail business, and storing crude oil and refined products.
Logistics Our logistics segment generates revenues by charging fees for transporting crude oil to our refineries, delivering refined products to wholesale and bulk customers and to our retail business, and storing crude oil and refined products. Substantially all of our revenues from our logistics segment represent intercompany transactions that are eliminated in consolidation.
Competition Competitive factors that affect our retail performance include product price, station appearance, location, customer service, and brand awareness. Our Hawaii competitors include the Shell, Texaco, Costco, Safeway, and Sam’s Club national brands, regional brand Aloha, and other local retailers.
Additionally, we opened a new to industry site in a growth area of Spokane, Washington, on September 25, 2023. Competition Competitive factors that affect our retail performance include product price, station appearance, location, customer service, and brand awareness. Our Hawaii competitors include the Shell, Texaco, Costco, Safeway, and Sam’s Club national brands, regional brand Aloha, and other local retailers.
Health and Safety Safety is paramount to every operation and activity we undertake at Par. We recognize that our responsible stewardship impacts every employee, every contractor, and every member of the community, and we embrace that responsibility. We promote a culture of continuous safety improvement with a keen eye for evaluating and managing risk.
We recognize that our responsible stewardship impacts every employee, every contractor, and every member of the community, and we embrace that responsibility. We promote a culture of continuous safety improvement with a keen eye for evaluating and managing risk. We continually monitor and improve the effectiveness of our health and safety programs, policies, and procedures to achieve this objective.
Certain of our Hawaii locations and all of the Washington and Idaho locations are operated by our personnel and include various sizes of convenience stores, snack shops, and kiosks. The remaining locations in Hawaii are cardlocks or sites operated by third parties where we retain ownership of the fuel and set retail pricing.
Retail The retail segment includes locations in Hawaii, Washington, and Idaho where we set the price to the retail consumer. Certain of our Hawaii locations and all of the Washington and Idaho locations are operated by our personnel and include various sizes of convenience stores, snack shops, and kiosks.
However, in 2022, EPA generally denied all small refinery exemption petitions, including ours. Litigation surrounding the 2022 RFS volumetric requirements and other aspects of those final rules, including the EPA’s denial of small refinery relief, is ongoing in Wynnewood Ref. Co., LLC v EPA.
However, in 2022, EPA generally denied all small refinery exemption petitions, including ours. Litigation surrounding the 2022 RFS volumetric requirements and other aspects of those final rules, including the EPA’s denial of small refinery relief, is ongoing in several cases. On July 26, 2024, 8 the D.C. Circuit in Sinclair Wyoming Refining Company v.
Environmental Protection Agency’s (“EPA”) ENERGY STAR certification, indicating the refinery performs in the top 25% of similar facilities nationwide for energy efficiency and meets strict energy efficiency performance levels set by the EPA. Wyoming Refinery. Our Wyoming refinery is located in Newcastle, Wyoming, and is rated at 20 Mbpd thr oughput capacity.
In January 2024, our Washington refinery was awarded the U.S. Environmental Protection Agency’s (“EPA”) ENERGY STAR certification, indicating the refinery performs in the top 25% of similar facilities nationwide for energy efficiency and meets strict energy efficiency performance levels set by the EPA. Wyoming Refinery.
They may also impact the use of and demand for petroleum products, which could impact our business. Further, apart from these developments, tort claims alleging property damage against GHG emissions sources may be asserted. Due to the uncertainties surrounding the regulation of and other risks associated with GHG emissions, we cannot predict the financial impact of related developments on us.
Such developments may affect how these GHG initiatives will impact us. They may also impact the use of and demand for petroleum products, which could impact our business. Further, apart from these developments, tort claims alleging property damage against GHG emissions sources may be asserted.
Given the nature of our operations, including sourcing crude oil and feedstocks, geopolitical conflicts may affect our business and results of operations. The Russia-Ukraine war, the Israel-Palestine conflict, Houthi attacks in the Red Sea, and Iranian activities in the Strait of Hormuz have all disrupted global trade patterns, increased crude oil price volatility, and increased freight costs and delivery times.
The Russia-Ukraine war, the Israel-Palestine conflict, Houthi attacks in the Red Sea, and Iranian activities in the Strait of Hormuz have all continued to disrupt global trade patterns, increase crude oil price volatility, and increase freight costs and delivery times.
Our commitment to doing the right thing with the highest ethical standards enables us to achieve our best results. As we pursue growth and success, we believe it is important to keep our people safe, to value our diversity, and to protect our environment.
Our commitment to doing 11 the right thing with the highest ethical standards enables us to achieve our best results. As we pursue growth and success, we believe it is important to keep our people safe and to protect our environment. Benefits We offer highly competitive compensation, be nefit, and time-off packages to promote employee fulfillment and work-life balance.
Other Government Regulation OSHA We are subject to the requirements of the federal Occupational Safety and Health Act (“OSHA”) and comparable state statutes.
The CZMA provides for federal grants for state management programs that regulate land use, water use, and coastal development. Other Government Regulation OSHA We are subject to the requirements of the federal Occupational Safety and Health Act (“OSHA”) and comparable state statutes.
Since ceasing refining operations at the Par West facility in 2020, our annual emissions are well below the GHG emissions cap. 6 The State of Washington and its political subdivisions passed several climate-focused laws in 2021 that are relevant to our operations within the state.
The State of Washington and its political subdivisions passed several climate-focused laws in 2021 that are relevant to our operations within the state.
Oil Pollution Act The Oil Pollution Act of 1990 (“OPA”) and regulations thereunder impose a variety of requirements on “responsible parties” related to the prevention of crude oil spills and liability for damages resulting from such spills in U.S. waters.
At this time, we do not believe that we have any material liability associated with any Superfund site and we have not been notified of any claim, liability, or damages under CERCLA. 9 Oil Pollution Act The Oil Pollution Act of 1990 (“OPA”) and regulations thereunder impose a variety of requirements on “responsible parties” related to the prevention of crude oil spills and liability for damages resulting from such spills in U.S. waters.
More stringent air pollutant standards and corresponding rules have already impacted and will continue to cause many refineries to invest heavily in additional air pollution controls.
States are required to develop State Implementation Plans and ultimately local air districts are required to adopt rules designed to improve air quality over time. More stringent air pollutant standards and corresponding rules have already impacted and will continue to cause many refineries to invest heavily in additional air pollution controls.
The “76” license agreement expires October 31, 2031, unless extended by mutual agreement. Since its launch in 2016, the Hele brand has won several awards for being the preferred fuel choice for Hawaii customers. Our cardlock locations on Kauai are branded Kauai Automated Fuels (“KAF”). We operate convenience stores at all of our retail fuel outlets in Washington and Idaho.
We also hold exclusive licenses within the state of Hawaii to utilize the “76” brand for retail locations. The “76” license agreement expires October 31, 2031, unless extended by mutual agreement. Since its launch in 2016, the Hele brand has won several awards for being the preferred fuel choice for Hawaii customers.
Our operating results are affected by changes in pricing for crude oil, feedstocks, and natural gas, as well as changes in the markets that we serve. All our refineries’ product slates are tailored to meet local demand. In the continental U.S., our refined products typically serve areas ranging from Washington state to the Dakotas and Wyoming.
In addition, the energy industry is subject to global economic and political factors and changing governmental regulations. Our operating results are affected by changes in pricing for crude oil, feedstocks, and natural gas, as well as changes in the markets that we serve. All our refineries’ product slates are tailored to meet local demand.
As of December 31, 2023, our company-operated convenience stores with fuel in Hawaii are branded “Hele,” our proprietary brand. Additionally, some of our partner sites operate under our proprietary Hele fuel brand. We also hold exclusive licenses within the state of Hawaii to utilize the “76” brand for retail locations.
The remaining locations in Hawaii are cardlocks or sites operated by third parties where we retain ownership of the fuel and set retail pricing. As of December 31, 2024, our company-operated convenience stores with fuel in Hawaii are branded “Hele,” our proprietary brand. Additionally, some of our partner sites operate under our proprietary Hele fuel brand.
As of June 30, 2020, we discontinued the application of the equity method of accounting for our investment in Laramie Energy because the book value of such investment had been reduced to zero. Effective February 21, 2023, we resumed the application of the equity method of accounting with respect to our investment in Laramie Energy.
Effective February 21, 2023, we resumed the application of the equity method of accounting with respect to our investment in Laramie Energy, which was previously reduced to a book value of zero. The balance of our investment in Laramie Energy was $12.5 million as of December 31, 2024.
Hawaii consumer inflation is expected to decrease to 2.2% by 2026. 4 Mainland Markets Spokane, Washington, and Northwest Idaho are the primary regions of our Pacific Northwest retail operations and are enjoying significantly higher population growth rates than the country as a whole. The U.S.
Mainland Markets Spokane, Washington, and Northwest Idaho are the primary regions of our Pacific Northwest retail operations and are enjoying significantly higher population growth rates than the country as a whole. The U.S. Census Bureau noted that the population increased 3.3% in Washington and 8.8% in Idaho from 2020 to 2024 versus a national increase of only 2.6%.
Benefits We offer highly competitive compensation, be nefit, and time-off packages to promote employee fulfillment and work-life balance. Our benefits include our retirement savings plan with company match, employee stock purchase plan, extensive health and wellness benefits, generous time off allowance, and a tuition reimbursement program.
Our benefits include our retirement savings plan with company match, employee stock purchase plan, extensive health and wellness benefits, generous time off allowance, and a tuition reimbursement program. Health and Safety Safety is paramount to every operation and activity we undertake at Par.
Compliance with this rule has not had a material impact on our financial condition, results of operations, or cash flows to date.
Compliance with this rule has not had a material impact on our financial condition, results of operations, or cash flows to date. However, new operating and other regulatory standards could involve additional costs, and failure to comply with such standards could involve penalties, each of which could be material.
Please read the discussion of the RVO Adjusted USGC 3-2-1 Index in the Montana refinery section above for further information. In January 2024, our Wyoming refinery was also awarded the EPA’s ENERGY STAR certification. Crude Oil Supply We source our crude oil feedstock from North America, Asia, Latin America, Africa, the Middle East, and other sources.
In January 2024, our Wyoming refinery was also awarded the EPA’s ENERGY STAR certification. 3 Crude Oil Supply We source our crude oil feedstock from North America, Asia, Latin America, Africa, the Middle East, and other sources. Effective March 3, 2022, we suspended purchases of Russian crude oil as a response to the Russia-Ukraine conflict.
Other Investments As noted in the Refining and Logistics discussions above, as of December 31, 2023 through the Billings Acquisition, we own a 65% and a 40% equity investment in YELP and YPLC, respectively.
Please read Note 4—Investment in Laramie Energy to our consolidated financial statements under Item 8 of this Form 10-K for further information. Other Investments As noted in the Refining and Logistics discussions above, as of December 31, 2024, through the Billings Acquisition, we own a 65% and a 40% equity investment in YELP and YPLC, respectively.
We use our proprietary “nomnom” brand at both the fueling facilities and stores. Our current store count includes the acquisition and rebranding of three convenience store locations in Washington acquired on December 2, 2022. Additionally, we opened a new to industry site in a growth area of Spokane, Washington, on September 25, 2023.
Our cardlock locations on Kauai are branded Kauai Automated Fuels (“KAF”). We operate convenience stores at all of our retail fuel outlets in Washington and Idaho. We use our proprietary “nomnom” brand at both the fueling facilities and stores. Our current store count includes the acquisition and rebranding of three convenience store locations in Washington acquired on December 2, 2022.
The Wyoming refinery’s major processing units produce gasoline, ULSD, jet fuel, and other associated refined products. We believe the RVO Adjusted USGC 3-2-1 the most representative market indicator for our Wyoming refining and fuel distribution operations with improved historical correlations to our reported adjusted gross margin compared to prior reported indices.
Our Wyoming refinery is located in Newcastle, Wyoming, and is rated at 20 Mbpd throughput capacity. The Wyoming refinery’s major processing units produce gasoline, ULSD, jet fuel, and other associated refined products. Prior to 2025, the RVO Adjusted USGC 3-2-1 Index was the most representative market indicator for our operations in Wyoming.
Many of these competitors have greater financial and technical resources and staff which may allow them to better withstand and react to changing and adverse market conditions. In addition, the energy industry is subject to global economic and political factors and changing governmental regulations.
Competition All facets of the energy industry are highly competitive. Our competitors include major integrated, national, and independent energy companies. Many of these competitors have greater financial and technical resources and staff which may allow them to better withstand and react to changing and adverse market conditions.
We also own and operate a jet fuel storage facility and pipeline that serve Ellsworth Air Force Base in South Dakota. Markets Hawaii Market Hawaii’s visitor industry is the primary driver of the state’s economy. In August 2023, the Maui wildfires dominated news headlines and the tragic event had a significant impact in Maui County.
We also own and operate a jet fuel storage facility and pipeline that serve Ellsworth Air Force Base in South Dakota. Markets Hawaii Market Hawaii is largely dependent on the visitor industry which impacts the state’s fuel consumption, particularly jet fuel.
On September 29, 2023, we received a letter from EPA related to the alleged violation of certain air emissions limits, controls, monitoring, and repair requirements under the Consent Decree. We are unable to predict the cost to resolve these alleged violations, but resolution will likely involve financial penalties or impose capital expenditure requirements that could be material.
On September 29, 2023, we 10 received a letter from EPA related to the alleged violation of certain air emissions limits, controls, monitoring, and repair requirements under the Consent Decree and the Clean Air Act.
Census Bureau noted that the population increased 14.6% in Washington and 17.3% in Idaho from 2010 to 2020 versus a national increase of only 7.4%. Spokane is a regional hub in eastern Washington, with a population of over a half million and a variety of employers in health care, retail, and other industries.
Spokane is a regional hub in eastern Washington, with a population of over a half million and a variety of employers in health care, retail, and other industries.
We believe the configuration of our Hawaii refinery uniquely fits the demands of the Hawaii market. We believe the 3-1-2 Singapore Crack Spread is the most representative market indicator for our Hawaii operations.
We believe the configuration of our Hawaii refinery uniquely fits the demands of the Hawaii market. Prior to 2025, the 3-1-2 Singapore Crack Spread was the most representative market indicator for our Hawaii operations, which was computed by taking one barrel of gasoline and two barrels of distillates (diesel and jet fuel) from three barrels of Brent crude oils.
Our refining business sources and obtains all of our crude oil from third-party sources and competes globally for crude oil and feedstocks. Retail The retail segment includes locations in Hawaii, Washington, and Idaho where we set the price to the retail consumer.
In the continental U.S., our refined products typically serve areas ranging from Washington state to the Dakotas and Wyoming. Our refining business sources and obtains all of our crude oil from third-party sources and competes globally for crude oil and feedstocks.
The 3-1-2 Singapore Crack Spread is computed by taking one barrel of gasoline and two barrels of distillates (diesel and jet fuel) from three barrels of Brent crude oil. Montana Refinery. Our Montana refinery is located along the Yellowstone River just outside Billings, Montana, and is rated at 63 Mbpd throughput capacity.
The Hawaii Index is calculated as the Singapore 3.1.2 Product Crack, which is made up of the same components as the 3-1-2 Singapore Crack Spread, less the Par Hawaii Refining, LLC (“PHR”) crude differential. Montana Refinery. Our Montana refinery is located along the Yellowstone River just outside Billings, Montana, and is rated at 63 Mbpd throughput capacity.
However, new operating and other regulatory standards could involve additional costs, and failure to comply with such standards could involve penalties, each of which could be material. 9 Hawaii Consent Decree On July 18, 2016, Par Hawaii Refining, LLC (“PHR”) and subsidiaries of Tesoro Corporation (“Tesoro”) entered into a consent decree with the EPA, the U.S.
Hawaii Consent Decree On July 18, 2016, PHR and subsidiaries of Tesoro Corporation (“Tesoro”) entered into a consent decree with the EPA, the U.S.
Our 1,814 employees work in the following operating segments throughout the United States: Operating Segment Number of Employees Refining and Logistics 1,064 Retail 574 Corporate 176 Total 1,814 10 Diversity and Inclusion Par is focused on recruiting and developing a diverse workforce.
Our 1,787 employees work in the following operating segments throughout the United States: Operating Segment Number of Employees Refining and Logistics 1,069 Retail 532 Corporate 186 Total 1,787 Culture and Values Par is a values-driven company. Our tight-knit community values integrity, creativity, hard work, and respect for others.
For more information, please read Note 18—Commitments and Contingencies to our consolidated financial statements under Item 8 of this Form 10-K. Coastal Coordination There are various federal and state programs that regulate the conservation and development of coastal resources.
We are unable to predict the cost to resolve these alleged violations, but resolution will likely involve financial penalties or impose capital expenditure requirements that could be material. For more information, please read Note 18—Commitments and Contingencies to our consolidated financial statements under Item 8 of this Form 10-K.
South Dakota welcomed 14.7 million visitors for the year, resulting in visitor spending of approximately $5.0 billion in 2023, an increase of 4.9% compared to 2022 and 22% over the pre-pandemic spending heights reached in 2019. Additionally, $1.1 billion, or 22%, of tourism dollars were spent on transportation services, representing an increase of nearly 17% over pre-pandemic transportation spending.
South Dakota welcomed 14.9 million visitors for the year, resulting in visitor spending of approximately $5.1 billion in 2024, an increase of 2.8% compared to 2023, due to a 5.4% increase driven by short-term rental price and demand increases.
Removed
Federal Reserve (the “Fed”) has taken significant steps to curb inflation, and continued to increase interest rates in 2023, from near zero percent at the beginning of 2022 to a range of 5.25% to 5.5% in December 2023.
Added
After aggressively raising interest rates in 2022 and early 2023 to bring down inflation, the Fed cut interest rates in 2024 in response to positive indicators of economic growth, including easing labor market conditions and lower inflation. Interest rates decreased to a range of 4.25% to 4.50% in December 2024 from 5.25% to 5.50% in December 2023.
Removed
These actions by the Fed acted to lower U.S. inflation rates, which have decreased 3.4% year over year as of the December inflation report released in January 2024. The U.S. retail price for regular-grade gasoline averaged $3.52 per gallon in 2023, following gasoline price highs of approximately $5.01 per gallon in the summer of 2022.
Added
Crude oil pricing decreased in 2024 compared to 2023. Brent crude oil pricing averaged $79.86 per barrel in 2024 compared to $82.17 per barrel in 2023. The U.S. retail price for regular-grade gasoline averaged $3.30 per gallon in 2024 compared to $3.52 per gallon in 2023.
Removed
This decline was due, in part, to lower crude oil prices in 2023 compared with 2022 and higher gasoline inventories in the second half of 2023. The COVID-19 Pandemic. Subsequent to the pandemic, and various preventive and mitigating measures taken in response, refined product demand has largely returned to 2019 levels.
Added
This decline was due, in part, to lower crude oil prices in 2024 compared to 2023, as noted above, as well as lower global demand primarily driven by decreased demand in China.
Removed
Despite global additions to refining capacity, the availability of refining capacity has not kept pace with demand, and global refinery utilization is above normal levels. Consequently, refining product margins have been consistently above pre-pandemic margins since the spring of 2022. Geopolitical Conflicts.
Added
The International Energy Agency (“IEA”) revised its forecast in its February 2025 Oil Market Report, which projected higher global oil demand in 2025 citing China, India, and other emerging Asian economies as the primary sources of growth. Geopolitical Conflicts.
Removed
We believe the RVO Adjusted Pacific Northwest 3-1-1-1 Index is the most representative market indicator for our operations in Tacoma, Washington with improved historical correlations to our reported adjusted gross margin compared to prior reported indices.
Added
Given the nature of our operations, including sourcing crude oil and feedstocks, geopolitical conflicts may affect our business and results of operations.
Removed
Effective March 3, 2022, we suspended purchases of Russian crude oil as a response to the Russia-Ukraine conflict. Competition All facets of the energy industry are highly competitive. Our competitors include major integrated, national, and independent energy companies.
Added
The overall effect of these conflicts and actions taken to limit the purchase of Russian petroleum products in response to the Russia-Ukraine war have raised the operating costs of many European and other refineries.
Removed
Substantially all of our revenues from our logistics segment represent intercompany transactions that are eliminated in consolidation. 3 Hawaii Logistics Our logistics network extends throughout the State of Hawaii. On Oahu, the system begins with our SPM located 1.7 miles offshore of our Hawaii refinery.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAs of December 31, 2023, we had $650.9 million of indebtedness and Interest expense and financing costs, net for the year ended December 31, 2023 was $72.5 million. 21 Our substantial level of indebtedness could have important consequences, including the following: • we must use a substantial portion of our cash flow from operations to pay interest and principal on our indebtedness and obligations under the Supply and Offtake Agreement and LC Facility, which reduces funds available to us for other purposes, such as working capital, capital expenditures, other general corporate purposes, and potential acquisitions; • our ability to refinance such indebtedness or to obtain additional financing for working capital, capital expenditures, acquisitions, or general corporate purposes may be impaired; • our leverage may be greater than that of some of our competitors, which may put us at a competitive disadvantage and reduce our flexibility in responding to current and changing industry and financial market conditions; • we may be more vulnerable to economic downturns and adverse developments in our business; and • we may be unable to comply with financial and other restrictive covenants in our debt agreements, some of which require us to maintain specified financial ratios and limit our ability to incur additional debt and sell assets, which could result in an event of default that, if not cured or waived, would have an adverse effect on our business and prospects and could result in bankruptcy.
Biggest changeOur substantial level of indebtedness could have important consequences, including the following: • we must use a substantial portion of our cash flow from operations to pay interest and principal on our indebtedness and obligations under the Inventory Intermediation Agreement, which reduces funds available to us for other purposes, such as working capital, capital expenditures, other general corporate purposes, and potential acquisitions; 21 • our ability to refinance such indebtedness or to obtain additional financing for working capital, capital expenditures, acquisitions, or general corporate purposes may be impaired; • our leverage may be greater than that of some of our competitors, which may put us at a competitive disadvantage and reduce our flexibility in responding to current and changing industry and financial market conditions; • we may be more vulnerable to economic downturns and adverse developments in our business; and • we may be unable to comply with financial and other restrictive covenants in our debt agreements, some of which require us to maintain specified financial ratios and limit our ability to incur additional debt and sell assets, which could result in an event of default that, if not cured or waived, would have an adverse effect on our business and prospects and could result in bankruptcy.
Since 2022, interest rates have been significantly higher than in recent years and a significant increase in prevailing interest rates that results in a substantial increase in the interest rates applicable to our indebtedness could substantially increase our interest expense and have a material adverse effect on our financial condition, results of operations, and cash flows.
Since 2023, interest rates have been significantly higher than in recent years and a significant increase in prevailing interest rates that results in a substantial increase in the interest rates applicable to our indebtedness could substantially increase our interest expense and have a material adverse effect on our financial condition, results of operations, and cash flows.
These factors include, among other things, changes in the economy, weather conditions, demographics and population, refined product mix demand, increased supply of refined products from competitors, and reductions in the supply of crude oil. We must make substantial capital expenditures at our refineries and related assets to maintain their reliability and efficiency.
These factors include, among other things, changes in the economy, weather conditions, demographics and population, refined product mix demand, increased supply of refined products from competitors, and reductions in the supply of crude oil. We must make substantial capital expenditures and complete periodic turnarounds at our refineries and related assets to maintain their reliability and efficiency.
Increased competition from these alternatives as a result of governmental regulations, technological advances, and consumer demand could have an impact on pricing and demand for our products and our profitability. 20 If we are unable to obtain crude oil supplies for our refineries without the benefit of our Supply and Offtake Agreement, LC Facility, and ABL Credit Facility, the capital required to finance our crude oil supply could negatively impact our liquidity.
Increased competition from these alternatives as a result of governmental regulations, technological advances, and consumer demand could have an impact on pricing and demand for our products and our profitability. 20 If we are unable to obtain crude oil supplies for our refineries without the benefit of our Inventory Intermediation Agreement and ABL Credit Facility, the capital required to finance our crude oil supply could negatively impact our liquidity.
These state actions could reduce demand for our refined petroleum products, which could have a material adverse effect on our business, results of operations, and financial condition. Potential legislative and regulatory actions addressing climate change could increase our costs, reduce our revenue and cash flow from natural gas and oil sales, or otherwise alter the way we conduct our business.
These state actions could reduce demand for our refined petroleum products, which could have a material adverse effect on our business, results of operations, and financial condition. Potential legislative and regulatory actions addressing climate change could increase our costs, reduce our revenue and cash flow from operations, or otherwise alter the way we conduct our business.
Delays or cost increases related to the engineering, procurement, and construction of new facilities, or improvements and repairs to our existing facilities and equipment, could have a material adverse effect on our business, financial condition, or results of operations.
Delays or cost increases related to the engineering, procurement, and construction of new facilities, or improvements and repairs to our existing facilities and equipment during periodic turnarounds, could have a material adverse effect on our business, financial condition, or results of operations.
We cannot be certain that our net operating loss tax carryforwards will continue to be available to offset our tax liability. As of December 31, 2023, we estimated that we had approximately $0.9 billion of net operating loss (“NOL”) tax carryforwards. In order to utilize the NOLs, we must generate taxable income that can offset such carryforwards.
We cannot be certain that our net operating loss tax carryforwards will continue to be available to offset our tax liability. As of December 31, 2024, we estimated that we had approximately $1.0 billion of net operating loss (“NOL”) tax carryforwards. In order to utilize the NOLs, we must generate taxable income that can offset such carryforwards.
As of December 31, 2023, we have accrued $14.0 million for the well-understood components of these efforts based on current 18 information, approximately one-third of which we expect to incur in the next five years and the remainder to be incurred over approximately 30 years.
As of 18 December 31, 2024, we have accrued $13.1 million for the well-understood components of these efforts based on current information, approximately one-third of which we expect to incur in the next five years and the remainder to be incurred over approximately 30 years.
We cannot assure you that any of these remedies could, if necessary, be affected on commercially reasonable terms, or at all. Our liquidity is constrained by our need to satisfy our obligations under our debt agreements, the Supply and Offtake Agreement, and the LC Facility.
We cannot assure you that any of these remedies could, if necessary, be affected on commercially reasonable terms, or at all. Our liquidity is constrained by our need to satisfy our obligations under our debt agreements, and the Inventory Intermediation Agreement.
As of December 31, 2023, we employed 1,814 people, 331 of whom are covered by collective bargaining agreements. At our Hawaii, Washington, and Montana refineries, all 331 employees covered by collective bargaining agreements are represented by the USW with collective bargaining agreements effective through January 31, 2026.
As of December 31, 2024, we employed 1,787 people, 403 of whom are covered by collective bargaining agreements. At our Hawaii, Washington, and Montana refineries, all 403 employees covered by collective bargaining agreements are represented by the USW with collective bargaining agreements effective through January 31, 2026.
We are subject to interest rate risk in connection with borrowings under certain of our debt agreements as well as our Supply and Offtake Agreement and LC Facility, which bear interest at variable rates.
We are subject to interest rate risk in connection with borrowings under certain of our debt agreements as well as our Inventory Intermediation Agreement, which bear interest at variable rates.
Nevertheless, stricter regulation can be expected in the future and any of these or similar changes, or regulatory enforcement in connection with such requirements, may have a material adverse impact on our business, results of operations, and financial condition.
Nevertheless, stricter regulation can be expected in the future and any of these or similar changes, including a switch to alternative fuels such as liquified natural gas for power generation, or regulatory enforcement in connection with such requirements, may have a material adverse impact on our business, results of operations, and financial condition.
Such increased exposure could negatively impact our liquidity position due to the increase in working capital used to acquire crude oil inventory for our refineries. The Supply and Offtake Agreement and LC Facility expose us to counterparty credit and performance risk. We have the Supply and Offtake Agreement with J. Aron, pursuant to which J.
Such increased exposure could negatively impact our liquidity position due to the increase in working capital used to acquire crude oil inventory for our refineries. The Inventory Intermediation Agreement expose us to counterparty credit and performance risk. We have the Inventory Intermediation Agreement with Citi, pursuant to which Citi will purchase and deliver crude oil to our Hawaii refinery.
Adverse changes in global economic conditions and the demand for transportation fuels may impact our business and financial condition in ways that we currently cannot predict. A recession or prolonged economic downturn would adversely affect the business and economic environment in which we operate. These conditions increase the risks associated with the creditworthiness of our suppliers, customers, and business partners.
Technological change or adverse changes in global economic conditions could affect the demand for transportation fuels and impact our business and financial condition in ways that we currently cannot predict. A recession or prolonged economic downturn would adversely affect the business and economic environment in which we operate.
The market price for our common stock has varied between a high of $37.02 on August 11, 2023, and a low of $20.66 on May 5, 2023 , during the year ended December 31, 2023. This volatility may affect the price at which you could sell your common stock.
The market price for our common stock has varied between a high of $40.34 on February 26, 2024, and a low of $15.09 on December 20, 2024, during the year ended December 31, 2024. This volatility may affect the price at which you could sell your common stock.
The consequences of such adverse effects could include interruptions or delays in our suppliers’ performance of our contracts, reductions and delays in customer purchases, delays in or the inability of customers to obtain financing to purchase our products, and bankruptcy of customers. Any of these events may adversely affect our financial condition, cash flows, and profitability.
These conditions increase the risks associated with the creditworthiness of our suppliers, customers, and business partners. The consequences of such adverse effects could include interruptions or delays in our suppliers’ performance of our contracts, reductions and delays in customer purchases, delays in or the inability of customers to obtain financing to purchase our products, and bankruptcy of customers.
All of the crude oil delivered at our Hawaii refinery is subject to our Supply and Offtake Agreement with J. Aron and certain crude deliveries at our Hawaii refinery are subject to the LC Facility. Deliveries of crude oil at our other refineries are subject to the ABL Credit Facility.
Crude oil in storage tanks and certain crude oil in transit at our Hawaii refinery is subject to our Inventory Intermediation Agreement. Deliveries of crude oil at our other refineries are subject to the ABL Credit Facility.
On January 20, 2021, President Biden announced that the United States would be reentering the Paris Agreement. This reentry became effective on February 19, 2021.
On January 20, 2021, President Biden announced that the United States would be reentering the Paris Agreement. This reentry became effective on February 19, 2021, however, on January 20, 2025, President Trump signed Executive Order 14162 directing the U.S. government to again withdraw from the Paris Agreement.
This repurchase obligation could have a material adverse effect on our business, results of operations, or financial condition. Our agreement with J. Aron also requires us to pay substantial interest expense associated with the facility, which will increase in a rising crude oil price and interest rate environment.
Our agreement with Citi also requires us to pay interest expense associated with the facility, which will increase in a rising crude oil price and interest rate environment.
Additionally, tax rates or tax interpretations in the various jurisdictions in which we operate may change significantly as a result of political or economic factors beyond our control.
Additionally, tax rates or tax interpretations in the various jurisdictions in which we operate may change significantly as a result of political or economic factors beyond our control. For more information, please read Note 18—Commitments and Contingencies to our consolidated financial statements under Item 8 of this Form 10-K .
As of January 23, 2024, Blackrock, Inc., together with its affiliates, owned or had the right to acquire approximately 14.3% of our outstanding common stock.
Based on Schedule 13G filed on February 5, 2025, Blackrock, Inc., together with its affiliates, owns or had the right to acquire approximately 17.1% of our outstanding common stock.
For more information, please read Note 18—Commitments and Contingencies to our consolidated financial statements under Item 8 of this Form 10-K . 19 BUSINESS RISKS The locations of our refineries and related assets in certain limited geographic areas create an exposure to localized economic risks.
We cannot predict whether, or to what extent, tariff or other trade protections may affect our financial condition, results of operations, or cash flows. 19 BUSINESS RISKS The locations of our refineries and related assets in certain limited geographic areas create an exposure to localized economic risks.
Removed
Restrictions on emissions of methane or carbon dioxide that have been or may be imposed in various U.S. states, at the U.S. federal level, or in other countries could adversely affect the oil and gas industry.
Added
Tariffs may adversely affect our financial condition, results of operations, and cash flows. President Trump has threatened to implement tariffs on certain foreign goods, such as crude oil from Canada. Tariffs against Canadian crude oil would increase our input costs, resulting in higher production costs and lower gross margins, and could make our products less competitive and reduce consumer demand.
Removed
Aron will intermediate crude oil supplies and refined product inventories at our Hawaii refinery. J. Aron will own all of the crude oil in our tanks and substantially all of our refined product inventories prior to our sale of the inventories.
Added
Any such tariffs or, if enacted, any further executive or legislative action that affects trade, including retaliatory tariffs, could subject us to additional risks.
Removed
Upon termination of the Supply and Offtake Agreement, which terminates on May 31, 2024, we are obligated to repurchase all crude oil and refined product inventories then owned by J. Aron and located at the specified storage facilities at then current market prices.
Added
Upon termination of the Inventory Intermediation Agreement, we are obligated to repurchase all crude oil inventories then owned by Citi. This repurchase obligation could have a material adverse effect on our business, results of operations, or financial condition.
Removed
We also have the LC Facility which is intended to finance and provide credit support for certain of PHR’s purchases of crude oil.
Added
As of December 31, 2024, we had $1.1 billion of indebtedness and Interest expense and financing costs, net for the year ended December 31, 2024, was $82.8 million.
Added
Additionally, technological changes or innovations related to, among other things, electric vehicles or autonomous driving may create risks to our business that we are unable to predict. Any of these events may adversely affect our financial condition, cash flows, and profitability.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe CIO’s extensive experience in technology and risk management, including prior work experience in cybersecurity, complemented by other members of our information technology department and third-party vendors, form the backbone of our cybersecurity capability.
Biggest changeThe CIO’s extensive experience in technology and risk management, including prior work experience in cybersecurity, complemented by other members of our IT department and third-party vendors, form the backbone of our cybersecurity capability. Our cybersecurity program is based on 26 recognized best practices and standards for cybersecurity and IT, including the National Institute of Standards and Technology Cybersecurity Framework.
Additionally, at least once each year the CIO briefs the Audit Committee on the results of an independent third-party assessment of the Company’s cybersecurity and the Company’s information technology incident response and recovery plan. At the management level, our cybersecurity strategy is managed by the CIO.
Additionally, at least once each year the CIO briefs the Audit Committee on the results of an independent third-party assessment of the Company’s cybersecurity and the Company’s Information Technology (“IT”) incident response and recovery plan. At the management level, our cybersecurity strategy is managed by the CIO.
Our 26 cybersecurity program is based on recognized best practices and standards for cybersecurity and information technology, including the National Institute of Standards and Technology Cybersecurity Framework. Cybersecurity incidents that meet established reporting thresholds are escalated within the Company to the CIO and the Company’s executive leadership team and, where appropriate, reported to Audit Committee and Board of Directors.
Cybersecurity incidents that meet established reporting thresholds are escalated within the Company to the CIO and the Company’s executive leadership team and, where appropriate, reported to Audit Committee and Board of Directors.
Cybersecurity threats and related incidents have not had a material impact on the company to date, but future cybersecurity incidents could have a material effect on our business, financial condition, and results of operations. While we have not experienced any material cybersecurity incidents, there can be no guarantee that we will not be the subject of future successful attacks.
Cybersecurity threats and related incidents have not had a material impact on the company to date, but future cybersecurity incidents could have a material effect on our business, financial condition, and results of operations. Moreover, cybersecurity insurance may not be available on commercially reasonable terms.
Additional information on cybersecurity risks we face can be found in Part I, Item 1A. — Risk Factors.
While we have not experienced any material cybersecurity incidents, there can be no guarantee that we will not be the subject of future successful attacks. Additional information on cybersecurity risks we face can be found in Part I, Item 1A. — Risk Factors.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed4 unchanged
Biggest changeDuring the year ended December 31, 2023, we resumed the application of the equity method of accounting for our investment in Laramie Energy. As of December 31, 2023, the balance of our investment in Laramie Energy on our consolidated balance sheets was $14.3 million. Other We also own certain immaterial minority interests in wells located in Colorado.
Biggest changeDuring the year ended December 31, 2023, we resumed the application of the equity method of accounting for our investment in Laramie Energy. As of December 31, 2024, the balance of our investment in Laramie Energy on our consolidated balance sheets was $12.5 million. Other We also own certain immaterial minority interests in wells located in Colorado.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. MINE SAFETY DISCLOSURES 27 PART II Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES 28 Item 6. [RESERVED] 29 Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 30 Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 58 Item 8.
Biggest changeItem 4. MINE SAFETY DISCLOSURES 27 PART II Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES 28 Item 6. [RESERVED] 29 Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 30 Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 63 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe performance graph of our peer group is weighted by market value at the beginning of the period and our peer group consists of the following companies: Calumet Specialty Products Partners, L.P., Casey’s General Stores, Inc., Crossamerica Partners, L.P., CVR Energy, Inc., Darling Ingredients Inc., Delek US Holdings, Inc., Green Plains Inc., HF Sinclair Corp, Nustar Energy, L.P., Parkland Corp, PBF Energy, Inc., Stepan Company, Sunoco, L.P., Tronox Holdings, PLC, and Vertex Energy, Inc. 28 *$100 invested on December 31, 2018 in stock or index, including reinvestment of dividends.
Biggest changeThe performance graph of our peer group is weighted by market value at the beginning of the period and our peer group consists of the following companies: Calumet Inc, Casey’s General Stores, Inc., Crossamerica Partners, L.P., CVR Energy, Inc., Darling Ingredients Inc., Delek US Holdings, Inc., Green Plains Inc., HF Sinclair Corp, Parkland Corp, PBF Energy, Inc., Stepan Company, Sunoco, L.P., Tronox Holdings, PLC, and Vertex Energy, Inc. *$100 invested on December 31, 2019 in stock or index, including reinvestment of dividends. 28 Recent Sales of Unregistered Securities During the year ended December 31, 2024, we did not ha ve any sales of securities in transactions that were not registered under the Securities Act that have not been reported on Form 8-K or Form 10-Q.
The following line graph compares the cumulative total return on an investment in our common stock against the cumulative total return of the S&P 500 Composite Index and an index of peer companies (that we selected) for the five fiscal years ended December 31, 2023.
The following line graph compares the cumulative total return on an investment in our common stock against the cumulative total return of the S&P 500 Composite Index and an index of peer companies (that we selected) for the five fiscal years ended December 31, 2024.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND COMPANY PURCHASES OF EQUITY SECURITIES Market Information On February 20, 2018, our common stock began trading on the NYSE under the symbol “PARR.” Prior to that date, our common stock was traded on the NYSE American under the symbol “PARR.” As of February 22, 2024, there were 133 common stockholders of record.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND COMPANY PURCHASES OF EQUITY SECURITIES Market Information On February 20, 2018, our common stock began trading on the NYSE under the symbol “PARR.” Prior to that date, our common stock was traded on the NYSE American under the symbol “PARR.” As of February 21, 2025, there were 126 common stockholders of record.
On August 2, 2023, the Board approved expanding the Company’s share repurchase authorization from $50 million to $250 million. During the year ended December 31, 2023, 1,841 thousand shares were repurchased under this share repurchase program for a total of $62.1 million.
On August 2, 2023, the Board approved expanding the Company’s share repurchase authorization from $50 million to $250 million. During the year ended December 31, 2024, 5.0 million shares were repurchased under this share repurchase program for a total of $136.7 million.
On February 22, 2024, the closing price of our common stock was $38.40 per share on the NYSE. Dividends We have not paid dividends on our common stock and we do not expect to do so in the foreseeable future.
On February 21, 2025, the closing price of our common stock was $15.62 per share on the NYSE. Dividends We have not paid dividends on our common stock and we do not expect to do so in the foreseeable future.
Company Purchases of Equity Securities The following table sets forth certain information with respect to repurchases of our common stock during the quarter ended December 31, 2023: Period Total number of shares (or units) purchased (1) Average price paid per share (or unit) Total number of shares (or units) purchased as part of publicly announced plans or programs (1) Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs (1) October 1 - October 31, 2023 230,236 $ 32.69 229.263 $ 206,060,840 November 1 - November 30, 2023 438,141 33.46 438,141 191,400,332 December 1 - December 31, 2023 284,379 33.66 284,261 181,831,998 Total 952,756 $ 33.33 951,665 $ 181,831,998 ________________________________________________ (1) On November 10, 2021, the Board authorized and approved a share repurchase program for up to $50 million of the currently outstanding shares of the Company’s common stock, with no specified end date.
Company Purchases of Equity Securities The following table sets forth certain information with respect to repurchases of our common stock during the quarter ended December 31, 2024: Period Total number of shares (or units) purchased (1) Average price paid per share (or unit) Total number of shares (or units) purchased as part of publicly announced plans or programs (1) Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs (1) October 1 - October 31, 2024 78,349 $ 17.22 77,054 $ 60,011,282 November 1 - November 30, 2024 173,226 17.38 173,226 57,000,395 December 1 - December 31, 2024 664,870 15.99 664,870 46,368,980 Total 916,445 $ 16.36 915,150 $ 46,368,980 ________________________________________________ (1) On November 10, 2021, the Board authorized and approved a share repurchase program for up to $50 million of the currently outstanding shares of the Company’s common stock, with no specified end date.
Removed
Recent Sales of Unregistered Securities During the year ended December 31, 2023, we did not ha ve any sales of securities in transactions that were not registered under the Securities Act that have not been reported on Form 8-K or Form 10-Q.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

120 edited+75 added−44 removed72 unchanged
Biggest changeAs of December 31, 2023 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries ASSETS Current assets Cash and cash equivalents $ 10,369 $ 268,711 $ 27 $ 279,107 Restricted cash 339 — — 339 Trade accounts receivable — 367,249 — 367,249 Inventories — 1,160,395 — 1,160,395 Prepaid and other current assets 4,767 177,638 — 182,405 Due from related parties 380,159 — (380,159) — Total current assets 395,634 1,973,993 (380,132) 1,989,495 Property, plant, and equipment Property, plant, and equipment 21,350 1,552,496 3,955 1,577,801 Less accumulated depreciation and amortization (16,487) (458,616) (3,310) (478,413) Property, plant, and equipment, net 4,863 1,093,880 645 1,099,388 Long-term assets Operating lease right-of-use (“ROU”) assets 7,005 339,449 — 346,454 Refining and logistics equity investments — — 87,486 87,486 Investment in Laramie Energy, LLC — — 14,279 14,279 Investment in subsidiaries 1,070,518 — (1,070,518) — Intangible assets, net — 10,918 — 10,918 Goodwill — 126,678 2,597 129,275 Other long-term assets 726 65,323 120,606 186,655 Total assets $ 1,478,746 $ 3,610,241 $ (1,225,037) $ 3,863,950 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Current maturities of long-term debt $ — $ 4,255 $ — $ 4,255 Obligations under inventory financing agreements — 594,362 — 594,362 Accounts payable 4,991 386,334 — 391,325 Accrued taxes — 40,064 — 40,064 Operating lease liabilities — 72,833 — 72,833 Other accrued liabilities 947 415,468 5,347 421,762 Due to related parties 128,922 232,803 (361,725) — Total current liabilities 134,860 1,746,119 (356,378) 1,524,601 Long-term liabilities Long-term debt, net of current maturities — 646,603 — 646,603 Finance lease liabilities — 16,693 (4,255) 12,438 Operating lease liabilities 8,462 274,055 — 282,517 Other liabilities — 119,618 (57,251) 62,367 Total liabilities 143,322 2,803,088 (417,884) 2,528,526 Commitments and contingencies Stockholders’ equity Preferred stock — — — — Common stock 597 — — 597 Additional paid-in capital 860,797 242,505 (242,505) 860,797 Accumulated earnings (deficit) 465,856 558,581 (558,581) 465,856 Accumulated other comprehensive income (loss) 8,174 6,067 (6,067) 8,174 Total stockholders’ equity 1,335,424 807,153 (807,153) 1,335,424 Total liabilities and stockholders’ equity $ 1,478,746 $ 3,610,241 $ (1,225,037) $ 3,863,950 45 As of December 31, 2022 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries ASSETS Current assets Cash and cash equivalents $ 2,547 $ 488,350 $ 28 $ 490,925 Restricted cash 331 3,670 — 4,001 Trade accounts receivable — 252,816 69 252,885 Inventories — 1,041,983 — 1,041,983 Prepaid and other current assets 2,229 89,883 (69) 92,043 Due from related parties 229,431 — (229,431) — Total current assets 234,538 1,876,702 (229,403) 1,881,837 Property, plant, and equipment Property, plant, and equipment 19,865 1,200,747 3,955 1,224,567 Less accumulated depreciation and amortization (14,967) (370,643) (3,123) (388,733) Property, plant, and equipment, net 4,898 830,104 832 835,834 Long-term assets Operating lease right-of-use (“ROU”) assets 2,649 348,112 — 350,761 Investment in subsidiaries 487,943 — (487,943) — Intangible assets, net — 13,577 — 13,577 Goodwill — 126,727 2,598 129,325 Other long-term assets 723 72,721 (4,131) 69,313 Total assets $ 730,751 $ 3,267,943 $ (718,047) $ 3,280,647 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Current maturities of long-term debt $ — $ 10,956 $ — $ 10,956 Obligations under inventory financing agreements — 893,065 — 893,065 Accounts payable 4,176 147,219 — 151,395 Accrued taxes 47 32,052 — 32,099 Operating lease liabilities 787 65,294 — 66,081 Other accrued liabilities 511 639,396 587 640,494 Due to related parties 77,420 118,139 (195,559) — Total current liabilities 82,941 1,906,121 (194,972) 1,794,090 Long-term liabilities Long-term debt, net of current maturities — 494,576 — 494,576 Finance lease liabilities — 10,710 (4,399) 6,311 Operating lease liabilities 3,273 289,428 — 292,701 Other liabilities — 46,922 1,510 48,432 Total liabilities 86,214 2,747,757 (197,861) 2,636,110 Commitments and contingencies Stockholders’ equity Preferred stock — — — — Common stock 604 — — 604 Additional paid-in capital 836,491 409,686 (409,686) 836,491 Accumulated earnings (deficit) (200,687) 104,479 (104,479) (200,687) Accumulated other comprehensive income (loss) 8,129 6,021 (6,021) 8,129 Total stockholders’ equity 644,537 520,186 (520,186) 644,537 Total liabilities and stockholders’ equity $ 730,751 $ 3,267,943 $ (718,047) $ 3,280,647 46 Year Ended December 31, 2023 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Revenues $ — $ 8,231,886 $ 69 $ 8,231,955 Operating expenses Cost of revenues (excluding depreciation) — 6,838,109 — 6,838,109 Operating expense (excluding depreciation) — 485,587 — 485,587 Depreciation and amortization 1,618 118,024 188 119,830 General and administrative expense (excluding depreciation) 29,258 62,189 — 91,447 Equity earnings from refining and logistics investments — — (11,844) (11,844) Acquisition and integration costs — 17,482 — 17,482 Par West redevelopment and other costs — 11,397 — 11,397 Loss (gain) on sale of assets, net 30 (89) — (59) Total operating expenses 30,906 7,532,699 (11,656) 7,551,949 Operating income (loss) (30,906) 699,187 11,725 680,006 Other income (expense) Interest expense and financing costs, net (24) (72,789) 363 (72,450) Debt extinguishment and commitment costs — (19,182) — (19,182) Other income (expense), net 44 (97) — (53) Equity earnings (losses) from subsidiaries 759,528 — (759,528) — Equity earnings from Laramie Energy, LLC — — 24,985 24,985 Total other income (expense), net 759,548 (92,068) (734,180) (66,700) Income (loss) before income taxes 728,642 607,119 (722,455) 613,306 Income tax benefit (expense) (1) — (153,017) 268,353 115,336 Net income (loss) $ 728,642 $ 454,102 $ (454,102) $ 728,642 Adjusted EBITDA $ (28,722) $ 709,613 $ 15,356 $ 696,247 47 Year Ended December 31, 2022 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Revenues $ — $ 7,321,656 $ 129 $ 7,321,785 Operating expenses Cost of revenues (excluding depreciation) — 6,377,494 (1,480) 6,376,014 Operating expense (excluding depreciation) — 333,206 — 333,206 Depreciation and amortization 2,131 97,448 190 99,769 General and administrative expense (excluding depreciation) 17,882 44,514 — 62,396 Acquisition and integration costs 3,396 267 — 3,663 Par West redevelopment and other costs — 9,003 — 9,003 Loss (gain) on sale of assets, net 27 (196) — (169) Total operating expenses 23,436 6,861,736 (1,290) 6,883,882 Operating income (loss) (23,436) 459,920 1,419 437,903 Other income (expense) Interest expense and financing costs, net (1) (68,655) 368 (68,288) Debt extinguishment and commitment costs — (5,329) — (5,329) Other income (expense), net (20) 634 (1) 613 Equity earnings (losses) from subsidiaries 388,008 — (388,008) — Total other income (expense), net 387,987 (73,350) (387,641) (73,004) Income (loss) before income taxes 364,551 386,570 (386,222) 364,899 Income tax benefit (expense) (1) (362) (96,995) 96,647 (710) Net income (loss) $ 364,189 $ 289,575 $ (289,575) $ 364,189 Adjusted EBITDA $ (17,551) $ 659,378 $ 1,608 $ 643,435 48 Year Ended December 31, 2021 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Revenues $ — $ 4,710,039 $ 50 $ 4,710,089 Operating expenses Cost of revenues (excluding depreciation) — 4,338,474 — 4,338,474 Operating expense (excluding depreciation) — 290,795 (717) 290,078 Depreciation and amortization 2,452 91,550 239 94,241 Impairment expense — 1,838 — 1,838 General and administrative expense (excluding depreciation) 12,435 35,661 — 48,096 Acquisition and integration costs 87 — — 87 Par West redevelopment and other costs — 9,591 — 9,591 Loss (gain) on sale of assets, net 15 (10,949) (53,763) (64,697) Total operating expenses 14,989 4,756,960 (54,241) 4,717,708 Operating income (loss) (14,989) (46,921) 54,291 (7,619) Other income (expense) Interest expense and financing costs, net (2,600) (64,209) 316 (66,493) Debt extinguishment and commitment costs — (6,728) (1,416) (8,144) Gain on curtailment of pension obligation — 2,032 — 2,032 Other income (expense), net (33) (19) — (52) Equity earnings (losses) from subsidiaries (63,649) — 63,649 — Total other income (expense), net (66,282) (68,924) 62,549 (72,657) Income (loss) before income taxes (81,271) (115,845) 116,840 (80,276) Income tax benefit (expense) (1) (26) 24,835 (25,830) (1,021) Net income (loss) $ (81,297) $ (91,010) $ 91,010 $ (81,297) Adjusted EBITDA $ (12,468) $ 137,323 $ 767 $ 125,622 ________________________________________________________ (1) The income tax benefit (expense) of the Parent Guarantor and Par Borrower and Subsidiaries is determined using the separate return method.
Biggest changeFor purposes of the following condensed consolidating information, the Parent’s investment in its subsidiaries is accounted for under the equity method of accounting (dollar amounts in thousands). 48 As of December 31, 2024 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries ASSETS Current assets Cash and cash equivalents $ 7,095 $ 184,826 $ — $ 191,921 Restricted cash 346 — — 346 Trade accounts receivable — 398,131 — 398,131 Inventories — 1,089,318 — 1,089,318 Prepaid and other current assets 12,355 80,172 — 92,527 Due from related parties 368,222 — (368,222) — Total current assets 388,018 1,752,447 (368,222) 1,772,243 Property, plant, and equipment Property, plant, and equipment 24,536 1,702,474 3,956 1,730,966 Less accumulated depreciation and amortization (17,240) (553,918) (3,499) (574,657) Property, plant, and equipment, net 7,296 1,148,556 457 1,156,309 Long-term assets Operating lease right-of-use (“ROU”) assets 7,369 420,751 — 428,120 Refining and logistics equity investments — — 86,311 86,311 Investment in Laramie Energy, LLC — — 12,498 12,498 Investment in subsidiaries 993,901 — (993,901) — Intangible assets, net — 9,520 — 9,520 Goodwill — 126,678 2,597 129,275 Other long-term assets 726 111,206 123,163 235,095 Total assets $ 1,397,310 $ 3,569,158 $ (1,137,097) $ 3,829,371 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Current maturities of long-term debt $ — $ 4,885 $ — $ 4,885 Obligations under inventory financing agreements — 194,198 — 194,198 Accounts payable 4,257 432,538 — 436,795 Accrued taxes — 36,027 — 36,027 Operating lease liabilities 4 80,170 — 80,174 Other accrued liabilities 1,796 342,062 330 344,188 Due to related parties 189,232 156,619 (345,851) — Total current liabilities 195,289 1,246,499 (345,521) 1,096,267 Long-term liabilities Long-term debt, net of current maturities — 1,108,082 — 1,108,082 Finance lease liabilities 464 15,313 (4,087) 11,690 Operating lease liabilities 10,255 351,837 — 362,092 Other liabilities — 131,813 (71,875) 59,938 Total liabilities 206,008 2,853,544 (421,483) 2,638,069 Commitments and contingencies Stockholders’ equity Preferred stock — — — — Common stock 552 — — 552 Additional paid-in capital 884,548 161,642 (161,642) 884,548 Accumulated earnings (deficit) 295,846 545,720 (545,720) 295,846 Accumulated other comprehensive income (loss) 10,356 8,252 (8,252) 10,356 Total stockholders’ equity 1,191,302 715,614 (715,614) 1,191,302 Total liabilities and stockholders’ equity $ 1,397,310 $ 3,569,158 $ (1,137,097) $ 3,829,371 49 As of December 31, 2023 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries ASSETS Current assets Cash and cash equivalents $ 10,369 $ 268,711 $ 27 $ 279,107 Restricted cash 339 — — 339 Trade accounts receivable — 367,249 — 367,249 Inventories — 1,160,395 — 1,160,395 Prepaid and other current assets 4,767 177,638 — 182,405 Due from related parties 380,159 — (380,159) — Total current assets 395,634 1,973,993 (380,132) 1,989,495 Property, plant, and equipment Property, plant, and equipment 21,350 1,552,496 3,955 1,577,801 Less accumulated depreciation and amortization (16,487) (458,616) (3,310) (478,413) Property, plant, and equipment, net 4,863 1,093,880 645 1,099,388 Long-term assets Operating lease right-of-use (“ROU”) assets 7,005 339,449 — 346,454 Refining and logistics equity investments — — 87,486 87,486 Investment in Laramie Energy, LLC — — 14,279 14,279 Investment in subsidiaries 1,070,518 — (1,070,518) — Intangible assets, net — 10,918 — 10,918 Goodwill — 126,678 2,597 129,275 Other long-term assets 726 65,323 120,606 186,655 Total assets $ 1,478,746 $ 3,610,241 $ (1,225,037) $ 3,863,950 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Current maturities of long-term debt $ — $ 4,255 $ — $ 4,255 Obligations under inventory financing agreements — 594,362 — 594,362 Accounts payable 4,991 386,334 — 391,325 Accrued taxes — 40,064 — 40,064 Operating lease liabilities — 72,833 — 72,833 Other accrued liabilities 947 415,468 5,347 421,762 Due to related parties 128,922 232,803 (361,725) — Total current liabilities 134,860 1,746,119 (356,378) 1,524,601 Long-term liabilities Long-term debt, net of current maturities — 646,603 — 646,603 Finance lease liabilities — 16,693 (4,255) 12,438 Operating lease liabilities 8,462 274,055 — 282,517 Other liabilities — 119,618 (57,251) 62,367 Total liabilities 143,322 2,803,088 (417,884) 2,528,526 Commitments and contingencies Stockholders’ equity Preferred stock — — — — Common stock 597 — — 597 Additional paid-in capital 860,797 242,505 (242,505) 860,797 Accumulated earnings (deficit) 465,856 558,581 (558,581) 465,856 Accumulated other comprehensive income (loss) 8,174 6,067 (6,067) 8,174 Total stockholders’ equity 1,335,424 807,153 (807,153) 1,335,424 Total liabilities and stockholders’ equity $ 1,478,746 $ 3,610,241 $ (1,225,037) $ 3,863,950 50 Year Ended December 31, 2024 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Revenues $ — $ 7,974,432 $ 25 $ 7,974,457 Operating expenses Cost of revenues (excluding depreciation) — 7,101,148 — 7,101,148 Operating expense (excluding depreciation) — 584,282 — 584,282 Depreciation and amortization 1,636 129,766 188 131,590 General and administrative expense (excluding depreciation) 33,490 75,354 — 108,844 Equity earnings from refining and logistics investments — — (11,905) (11,905) Acquisition and integration costs (2) — 100 — 100 Par West redevelopment and other costs — 12,548 — 12,548 Loss (gain) on sale of assets, net 100 122 — 222 Total operating expenses 35,226 7,903,320 (11,717) 7,926,829 Operating income (loss) (35,226) 71,112 11,742 47,628 Other income (expense) Interest expense and financing costs, net (40) (83,106) 353 (82,793) Debt extinguishment and commitment costs — (1,688) — (1,688) Other income (expense), net (31) (1,838) — (1,869) Equity earnings (losses) from subsidiaries 1,975 — (1,975) — Equity earnings (losses) from Laramie Energy, LLC — — (296) (296) Total other income (expense), net 1,904 (86,632) (1,918) (86,646) Income (loss) before income taxes (33,322) (15,520) 9,824 (39,018) Income tax benefit (expense) (1) — 2,659 3,037 5,696 Net income (loss) $ (33,322) $ (12,861) $ 12,861 $ (33,322) Adjusted EBITDA $ (26,167) $ 242,913 $ 21,930 $ 238,676 51 Year Ended December 31, 2023 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Revenues $ — $ 8,231,886 $ 69 $ 8,231,955 Operating expenses Cost of revenues (excluding depreciation) — 6,838,109 — 6,838,109 Operating expense (excluding depreciation) — 485,587 — 485,587 Depreciation and amortization 1,618 118,024 188 119,830 General and administrative expense (excluding depreciation) 29,258 62,189 — 91,447 Equity earnings from refining and logistics investments — — (11,844) (11,844) Acquisition and integration costs (2) — 17,482 — 17,482 Par West redevelopment and other costs — 11,397 — 11,397 Loss (gain) on sale of assets, net 30 (89) — (59) Total operating expenses 30,906 7,532,699 (11,656) 7,551,949 Operating income (loss) (30,906) 699,187 11,725 680,006 Other income (expense) Interest expense and financing costs, net (24) (72,789) 363 (72,450) Debt extinguishment and commitment costs — (19,182) — (19,182) Other income (expense), net 44 (97) — (53) Equity earnings (losses) from subsidiaries 759,528 — (759,528) — Equity earnings (losses) from Laramie Energy, LLC — — 24,985 24,985 Total other income (expense), net 759,548 (92,068) (734,180) (66,700) Income (loss) before income taxes 728,642 607,119 (722,455) 613,306 Income tax benefit (expense) (1) — (153,017) 268,353 115,336 Net income (loss) $ 728,642 $ 454,102 $ (454,102) $ 728,642 Adjusted EBITDA $ (28,722) $ 709,613 $ 15,356 $ 696,247 52 Year Ended December 31, 2022 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Revenues $ — $ 7,321,656 $ 129 $ 7,321,785 Operating expenses Cost of revenues (excluding depreciation) — 6,377,494 (1,480) 6,376,014 Operating expense (excluding depreciation) — 333,206 — 333,206 Depreciation and amortization 2,131 97,448 190 99,769 General and administrative expense (excluding depreciation) 17,882 44,514 — 62,396 Acquisition and integration costs 3,396 267 — 3,663 Par West redevelopment and other costs — 9,003 — 9,003 Loss (gain) on sale of assets, net 27 (196) — (169) Total operating expenses 23,436 6,861,736 (1,290) 6,883,882 Operating income (loss) (23,436) 459,920 1,419 437,903 Other income (expense) Interest expense and financing costs, net (1) (68,655) 368 (68,288) Debt extinguishment and commitment costs — (5,329) — (5,329) Other income (expense), net (20) 634 (1) 613 Equity earnings (losses) from subsidiaries 388,008 — (388,008) — Total other income (expense), net 387,987 (73,350) (387,641) (73,004) Income (loss) before income taxes 364,551 386,570 (386,222) 364,899 Income tax benefit (expense) (1) (362) (96,995) 96,647 (710) Net income (loss) $ 364,189 $ 289,575 $ (289,575) $ 364,189 Adjusted EBITDA $ (17,551) $ 659,378 $ 1,608 $ 643,435 ________________________________________________________ (1) The income tax benefit (expense) of the Parent Guarantor and Par Borrower and Subsidiaries is determined using the separate return method.
The following should be read in conjunction with our consolidated financial statements under Item 8 of this Annual Report on Form 10-K.
The following should be read in conjunction with our consolidated financial statements under Item 8 of this Annual Report on Form 10-K.
This tax benefit is included in Income tax expense (benefit) on our consolidated statements of operations.
This tax benefit is included in Income tax benefit (expense) on our consolidated statements of operations.
Operating income for our refining segment was $676.2 million for the year ended December 31, 2023, an improvement of $274.3 million compared to $401.9 million for the year ended December 31, 2022.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Refining. Operating income for our refining segment was $676.2 million for the year ended December 31, 2023, an improvement of $274.3 million compared to $401.9 million for the year ended December 31, 2022.
Net cash used for changes in operating assets and liabilities resulted primarily from: • net increases in our Supply and Offtake Agreement and Washington Refinery Intermediation Agreement obligations and accounts payable, and • an increase in gross environmental credit obligations primarily related to current period production volumes and increases in RINs prices, partially offset by • net increases in our inventories and accounts receivable resulting from higher crude oil and refined product prices and higher inventory volumes at our Hawaii refinery, and • increase in prepaid and other primarily driven by a $34.7 million increase in Collateral posted with broker for derivative instruments.
Net cash used for changes in operating assets and liabilities resulted primarily from: • net increases in our Supply and Offtake Agreement and Washington Refinery Intermediation Agreement obligations and accounts payable, and • an increase in gross environmental credit obligations primarily related to current period production volumes and increases in RINs prices, partially offset by • net increases in our inventories and accounts receivable resulting from higher crude oil and refined product prices and higher inventory volumes at our Hawaii refinery, and • an increase in prepaid and other primarily driven by a $34.7 million increase in Collateral posted with broker for derivative instruments.
The increase in operating income was primarily driven by: • a decrease of $140.0 million in environmental credit and related obligations costs across our refineries in our legacy portfolio driven by favorable mark-to-market adjustments and a gain on retirement of prior year RINs, 39 • an increase of $106.0 million driven by a 6% increase in refined product sales volumes at our refineries in our legacy portfolio, • a favorable change in step-out obligations related to our intermediation agreements of $79.5 million driven by changes in commodity prices, • a net decrease of $76.4 million in our derivative costs associated with all our refineries, • a $56.9 million contribution from the Billings Acquisition, • $37.0 million related to lower fuel burn costs at all our refineries, and • an increase of $32.8 million related to a favorable change in crude oil differentials at our refineries in our legacy portfolio, partially offset by: • a net decrease of $112.9 million related to declining crack spreads at our refineries in our legacy portfolio, • an increase in purchased product costs of $98.0 million at all our refineries in our legacy portfolio, and • an increase in logistics and other product delivery costs of $35.6 million at our refineries in our legacy portfolio.
The increase in operating income was primarily driven by: • a decrease of $140.0 million in environmental credit and related obligations costs across our refineries in our legacy portfolio driven by favorable mark-to-market adjustments and a gain on retirement of prior year RINs, • an increase of $106.0 million driven by a 6% increase in refined product sales volumes at refineries in our legacy portfolio, • a favorable change in step-out obligations related to our intermediation agreements of $79.5 million driven by changes in commodity prices, • a net decrease of $76.4 million in our derivative costs associated with all our refineries, • a $56.9 million contribution from the Billings Acquisition, • $37.0 million related to lower fuel burn costs at all our refineries, and • an increase of $32.8 million related to a favorable change in crude oil differentials at refineries in our legacy portfolio, partially offset by: • a net decrease of $112.9 million related to declining crack spreads at our refineries in our legacy portfolio, • an increase in purchased product costs of $98.0 million at all our refineries in our legacy portfolio, and • an increase in logistics and other product delivery costs of $35.6 million at our refineries in our legacy portfolio.
We believe Adjusted Net Income (Loss) and Adjusted EBITDA (as defined below) are useful supplemental financial measures that allow investors to assess the financial performance of our assets without regard to financing methods, capital structure, or historical cost basis, the ability of our assets to generate cash to pay interest on our indebtedness, and our operating performance and return on invested capital as compared to other companies without regard to financing methods and capital structure.
We believe Adjusted Net Income (Loss) and Adjusted EBITDA (as defined below) are useful supplemental financial measures that allow management and investors to assess the financial performance of our assets without regard to financing methods, capital structure, or historical cost basis, the ability of our assets to generate cash to pay interest on our indebtedness, and our operating performance and return on invested capital as compared to other companies without regard to financing methods and capital structure.
Operating lease liabilities primarily include obligations associated with the lease of land, office space, retail facilities, and other facilities used in the storage and transportation of crude oil and refined products. Please read Note 17—Leases to our consolidated financial statements under Item 8 of this Form 10-K for further discussion. 55 Finance Lease Liabilities.
Operating lease liabilities primarily include obligations associated with the lease of land, office space, retail facilities, and other facilities used in the storage and transportation of crude oil and refined products. Please read Note 17—Leases to our consolidated financial statements under Item 8 of this Form 10-K for further discussion. Finance Lease Liabilities.
These valuation methods require us to make significant estimates and assumptions regarding future cash flows, capital projects, commodity prices, long-term growth rates, and discount rates. Please read Note 11—Goodwill and Intangible Assets to our consolidated financial statements under Item 8 of this Form 10-K for further information.
These valuation methods require us to make significant estimates and assumptions regarding future cash flows, capital projects, commodity prices, long-term growth rates, and discount rates. Please read Note 10—Goodwill and Intangible Assets to our consolidated financial statements under Item 8 of this Form 10-K for further information.
In addition, we have modified our environmental obligation mark-to-market adjustment to include only the mark-to-market losses (gains) associated with our net RINs liability and net obligation associated with the Washington Climate Commitment Act (“Washington CCA”) and Clean Fuel Standard. This modification was made as part of our change in how we estimate our environmental obligation liabilities.
In addition, we have modified our environmental obligation mark-to-market adjustment to include only the mark-to-market losses (gains) associated with our net RINs liability and net 37 obligation associated with the Washington Climate Commitment Act (“Washington CCA”) and Clean Fuel Standard. This modification was made as part of our change in how we estimate our environmental obligation liabilities.
We obtain the assistance of third-party valuation specialists in estimating fair values of tangible and intangible assets based on available historical information and on expectations and assumptions about the future, considering the perspectives of marketplace participants. These valuation methods require management to make estimates and assumptions regarding characteristics of the acquired property and future revenues and expenses.
We obtain the assistance of third-party valuation specialists in estimating fair values of tangible and intangible assets 61 based on available historical information and on expectations and assumptions about the future, considering the perspectives of marketplace participants. These valuation methods require management to make estimates and assumptions regarding characteristics of the acquired property and future revenues and expenses.
Net cash used for changes in operating assets and liabilities resulted primarily from: • a decrease in gross environmental credit obligations primarily related to the settlement of our 2020, 2021, and 2022 RINs obligations, and • increase in prepaid and other primarily driven by a $65.5 million increase in Advances to suppliers for crude purchases.
Net cash used for changes in operating assets and liabilities resulted primarily from: • a decrease in gross environmental credit obligations primarily related to the settlement of our 2020, 2021, and 2022 RINs obligations, and • an increase in prepaid and other primarily driven by a $65.5 million increase in Advances to suppliers for crude purchases.
For the year ended December 31, 2023, our interest expense and financing costs were approximately $72.5 million, an increase of $4.2 million compared to $68.3 million for the year ended December 31, 2022. The increase was primarily due to higher outstanding debt balances and increased borrowings under our inventory financing agreements.
For the year ended December 31, 2023, our Interest expense and financing costs, net were approximately $72.5 million, an increase of $4.2 million compared to $68.3 million for the year ended December 31, 2022. The increase was primarily due to higher outstanding debt balances and increased borrowings under our inventory financing agreements.
The following supplemental condensed consolidating financial information reflects (i) the Parent’s separate accounts, (ii) Par Borrower and its consolidated subsidiaries’ accounts (which are all guarantors of the Term Loan Credit Agreement), (iii) the accounts of subsidiaries of the Parent that are not guarantors of the Term Loan Credit Agreement and consolidating 44 adjustments and eliminations, and (iv) the Parent’s consolidated accounts for the dates and periods indicated.
The following supplemental condensed consolidating financial information reflects (i) the Parent’s separate accounts, (ii) Par Borrower and its consolidated subsidiaries’ accounts (which are all guarantors of the Term Loan Credit Agreement), (iii) the accounts of subsidiaries of the Parent that are not guarantors of the Term Loan Credit Agreement and consolidating adjustments and eliminations, and (iv) the Parent’s consolidated accounts for the dates and periods indicated.
Depreciation and Amortization . For the year ended December 31, 2023, D&A expense was approximately $119.8 million, an increase of $20.0 million compared to $99.8 million for the year ended December 31, 2022. The increase was primarily driven by the $21.7 million contribution from the Billings Acquisition. General and Administrative Expense (Excluding Depreciation).
For the year ended December 31, 2023, D&A expense was approximately $119.8 million, an increase of $20.0 million compared to $99.8 million for the year ended December 31, 2022. The increase was primarily driven by the $21.7 million contribution from the Billings Acquisition. General and Administrative Expense (Excluding Depreciation).
Future cash flow estimates used for impairment reviews are based on assessments requiring judgment, including future production volumes, commodity prices, operating costs, margins, discount rates, expected capital expenditures, and other factors based on all available information 57 available as of the date of the review.
Future cash flow estimates used for impairment reviews are based on assessments requiring judgment, including future production volumes, commodity prices, operating costs, margins, discount rates, expected capital expenditures, and other factors based on all available information available as of the date of the review.
In the fourth quarter of 2023 and due to Laramie Energy, LLC’s positive financial results, our share of net income from our investment in Laramie Energy exceeded our share of net losses recorded during the period that equity method accounting was suspended and we recorded equity earnings of $14.3 million.
In the fourth quarter of 2023 and due to Laramie Energy, LLC’s positive financial results, our share of net income from our investment in Laramie Energy exceeded our share of net losses recorded during the period that 47 equity method accounting was suspended, and we recorded equity earnings of $14.3 million.
Income Taxes We use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and NOL and tax credit carry forwards.
Income Taxes We use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and NOL and tax credit carry 62 forwards.
The 2022 and 2021 amounts for the total refining segment represent the sum of the Hawaii, Washington, and Wyoming refineries’ throughput or sales volumes averaged over the year ended December 31, 2022 and 2021. (2) We calculate Adjusted Gross Margin per barrel by dividing Adjusted Gross Margin by total refining throughput.
The 2022 amounts for the total refining segment represent the sum of the Hawaii, Washington, and Wyoming refineries’ throughput or sales volumes averaged over the year ended December 31, 2022. (2) We calculate Adjusted Gross Margin per barrel by dividing Adjusted Gross Margin by total refining throughput.
Adjusted Gross Margin for our Washington refinery is determined under the last-in, first-out (“LIFO”) inventory costing method. Adjusted Gross Margin for our other refineries is determined under the first-in, first-out (“FIFO”) inventory costing method. The definition of Adjusted Gross Margin was modified beginning with the financial results reported for periods in 35 fiscal year 2022.
Adjusted Gross Margin for our Washington refinery is determined under the last-in, first-out (“LIFO”) inventory costing method. Adjusted Gross Margin for our other refineries is determined under the first-in, first-out (“FIFO”) inventory costing method. The definition of Adjusted Gross Margin was modified beginning with the financial results reported for periods in fiscal year 2022.
Net cash used in investing activities for the year ended December 31, 2022 consisted primarily of: • $53.0 million in additions to property, plant, and equipment driven by profit improvement and turnaround projects including crude recovery and debottlenecking projects at our Tacoma refinery, maintenance and tank replacement projects at our Wyoming refinery, and co-generation engine and tank conversion projects at our Hawaii refinery, and • $35.5 million related to acquisitions, primarily comprised of a $30.0 million deposit on the Billings Acquisition and $5.5 million for a three-store expansion of our Washington retail footprint.
Net cash used in investing activities for the year ended December 31, 2022, consisted primarily of: • $53.0 million in additions to property, plant, and equipment driven by profit improvement and turnaround projects including crude recovery and debottlenecking projects at our Tacoma refinery, maintenance and tank replacements projects at our Wyoming refinery, and co-generation engine and tank conversion projects at our Hawaii refinery, and • $35.5 million related to acquisitions, primarily comprised of a $30.0 million deposit on the Billings Acquisition and $5.5 million for a three-store expansion of our Washington retail footprint.
Net cash provided by financing activities for the year ended December 31, 2022 was approximately $13.4 million and and consisted primarily of the following activities: 54 • net borrowings under the J.
Net cash provided by financing activities for the year ended December 31, 2022, was approximately $13.4 million and consisted primarily of the following activities: • net borrowings under the J.
Please read Note 10—Asset Retirement Obligations and Note 18—Commitments and Contingencies to our consolidated financial statements under Item 8 of this Form 10-K for more information. Critical Accounting Estimates The discussion and analysis of our financial condition and results of operations were based on the consolidated financial statements, which have been prepared in accordance with U.S. GAAP.
Please read Note 11—Asset Retirement Obligations and Note 18—Commitments and Contingencies to our consolidated financial statements under Item 8 of this Form 10-K for more information. 60 Critical Accounting Estimates The discussion and analysis of our financial condition and results of operations were based on the consolidated financial statements, which have been prepared in accordance with U.S. GAAP.
Our financial results for the year ended December 31, 2023 improved from a net income of $364.2 million for the year ended December 31, 2022 to $728.6 million for the year ended December 31, 2023.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Net Income. Our financial results for the year ended December 31, 2023, improved from a Net income of $364.2 million for the year ended December 31, 2022, to $728.6 million for the year ended December 31, 2023.
Adjusted Gross Margin Adjusted Gross Margin is defined as operating income (loss) excluding: • operating expense (excluding depreciation); • depreciation and amortization (“D&A”); • Par’s portion of interest, taxes, and depreciation expense from refining and logistics investments; • impairment expense; • loss (gain) on sale of assets, net; • inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, hedge losses (gains) associated with our Washington ending inventory and intermediation obligation, purchase price allocation adjustments, and LIFO layer increment and decrement impacts associated with our Washington inventory); • Environmental obligation mark-to-market adjustment (which represents the mark-to-market losses (gains) associated with our net RINs liability and our net obligation associated with the Washington Climate Commitment Act and Clean Fuel Standard); and • unrealized loss (gain) on derivatives.
Adjusted Gross Margin Adjusted Gross Margin is defined as Operating income (loss) excluding: • operating expense (excluding depreciation); • depreciation and amortization (“D&A”); • Par’s portion of interest, taxes, and D&A expense from refining and logistics investments; • impairment expense; • loss (gain) on sale of assets, net; • Par's portion of accounting policy differences from refining and logistics investments; • inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, hedge losses (gains) associated with our Washington ending inventory and intermediation obligation, purchase price allocation adjustments, and LIFO layer increment and decrement impacts associated with our Washington inventory); • Environmental obligation mark-to-market adjustment (which represents the mark-to-market losses (gains) associated with our net RINs liability and our net obligation associated with the Washington Climate Commitment Act and Clean Fuel Standard); and • unrealized loss (gain) on derivatives.
For the year ended December 31, 2023 , we incurred $17.5 million of acquisition and integration costs related to the Billings Acquisition, compared to $3.7 million of acquisition and integration costs for the year ended December 31, 2022. Please read Note 5—Acquisitions to our consolidated financial statements under Item 8 of this Form 10-K for more information.
For the year ended December 31, 2023, we incurred approximately $17.5 million of Acquisition and integration costs primarily related to the Billings Acquisition, compared to $3.7 million of Acquisition and integration costs for the year ended December 31, 2022. Please read Note 5—Acquisitions to our consolidated financial statements under Item 8 of this Form 10-K for more information.
The increase is primarily due to an $8.5 million contribution from the Billings Acquisition logistics assets acquired in June 2023 and an $10.4 million increase in operating income driven by an increase in throughput volumes throughout our legacy logistics portfolio, partially offset by an increase in variable expenses of $5.5 million. Retail.
The increase is primarily due to an 43 $8.5 million contribution from the Billings Acquisition logistics assets acquired in June 2023 and a $10.4 million increase in Operating income driven by an increase in throughput volumes throughout our legacy logistics portfolio, partially offset by an increase in variable expenses of $5.5 million. Retail.
The improvement was primarily related to an increase of $54.7 million in our refining segment, an increase of $22.3 million in our logistics segment, and an increase of $8.0 million in our retail segment, partially of fset by a decrease of $32.3 million in our corporate segment. Please read the discussion of segment results below for additional information.
The improvement was primarily related to an increase of $54.7 million in our refining segment, an increase of $22.3 million in our logistics segment, and an increase of $8.0 million in our retail segment, partially offset by a decrease of $32.3 million in our corporate segment. Please read the discussion of segment results below for additional information.
We will continue to reassess whether the balance of the valuation allowance is appropriate on a quarterly basis and, given the totality of the facts and circumstances, both positive and negative, will adjust the remaining valuation allowance in future periods if the evidence supports doing so.
We will continue to reassess whether the balance of the valuation allowance is appropriate on a yearly basis and, given the totality of the facts and circumstances, both positive and negative, will adjust the remaining valuation allowance in future periods if the evidence supports doing so.
Non-cash charges to operations consisted primarily of the following adjustments: • depreciation and amortization expenses of $99.8 million, • stock based compensation costs of $9.4 million, • unrealized loss on derivatives contracts of $9.3 million, and • debt commitment and extinguishment costs of $5.3 million.
Non-cash charges to operations consisted primarily of the following adjustments: • deprecation and amortization expenses of $99.8 million, • stock based compensation costs of $9.4 million, • unrealized loss on derivatives contracts of $9.3 million, and • debt commitment and extinguishment costs of $5.3 million.
The increase in profitability was primarily due to Adjusted Gross Margin contributed by the Montana refinery o f $246.1 million and 6.0% higher refined product sales margins across our legacy refining portfolio, partially offs et by $155.6 million higher environmental credit obligation costs, excluding the mark-to-market impacts, and lower crack spreads of $107.6 million . • Adjusted Gross Margin for the Hawaii refinery improved by $1.26 per barrel from $13.99 per barrel during the year ended December 31, 2022, to $15.25 per barrel during the year ended December 31, 2023, primarily due to lower feedstock costs, a 6% increase in refined product sales volumes, a favorable change in realized derivatives, and higher yield, partially offset by $98.0 million higher purchased product costs and lower crack spreads.
The increase in profitability was primarily due to Adjusted Gross Margin contributed by the Montana refinery of $246.1 million and 6.0% higher refined product sales margins across our legacy refining portfolio, partially offset by $155.6 million higher environmental credit obligation costs, excluding the mark-to-market impacts, and lower crack spreads of $107.6 million. • Adjusted Gross Margin for the Hawaii refinery improved by $1.26 per barrel from $13.99 per barrel during the year ended December 31, 2022, to $15.25 per barrel during the year ended December 31, 2023, primarily due to lower feedstock costs, a 6% increase in refined product sales volumes, a favorable change in realized derivatives, and higher 44 yield, partially offset by $98.0 million higher purchased product costs and lower crack spreads.
We review property, plant, and equipment, operating leases, and other long-lived assets whenever events or changes in business circumstances indicate the carrying value of the assets may not be recoverable. We use a cash flows model to estimate value because there is usually a lack of quoted market prices available for long-lived assets.
We review property, plant, and equipment, operating leases, deferred turnaround costs, and other long-lived assets whenever events or changes in business circumstances indicate the carrying value of the assets may not be recoverable. We use a cash flows model to estimate value because there is usually a lack of quoted market prices available for long-lived assets.
While inflation has improved relative to prior years, we do not believe that inflation has had a material effect on our business, financial condition or results of operations in 2023.
While inflation has improved relative to prior years, we do not believe that inflation has had a material effect on our business, financial condition or results of operations in 2024.
The increase was primarily due to Adjusted Gross Ma rgin of $23.8 million contributed from the Billings Acquisition logistics assets acquired in June 2023 and a 3% increase in throughput across our legacy assets, net of associated higher fees and variable expenses, and higher third-party revenue. Retail.
The increase was primarily due to Adjusted Gross Margin of $23.8 million contributed from the Billings Acquisition logistics assets acquired in June 2023 and a 3% increase in throughput across our legacy assets, net of associated higher fees and variable expenses, and higher third-party revenue. Retail.
The increase was prim arily due to a $12.1 million increase in employee costs, a $6.0 million increase in outside services, $5.8 million of expenses related to development of our renewable projects, and $3.9 million higher IT expenses. Equity earnings from refining and logistics investments .
The increase was primarily due to a $12.1 million increase in employee costs, a $6.0 million increase in outside services, $5.8 million of expenses related to development of our renewable projects, and $3.9 million higher IT expenses. Equity earnings from refining and logistics investments.
The increase was driven by a $274.3 million increase in refining segment operating income, an increase of $116.0 million in income tax benefit, and a $15.7 million increase in logistics segment operating income, partially offset by a $29.0 million increase in general and administrative expenses, a $13.8 million increase in acquisitions and integration expenses related to our Billings Acquisition, 30 and a $2.4 million increase in expenses related to Par West operations and redevelopment.
The increase was driven by a $274.3 million increase in refining segment Operating income, an increase of $116.0 million in Income tax benefit, and a $15.7 million increase in logistics segment Operating income, partially offset by a $29.0 million increase in general and administrative expenses, a $13.8 million increase in Acquisition and integration costs related to our Billings Acquisition, and a $2.4 million increase in expenses related to Par West redevelopment.
Please read Note 9—Property, Plant, and Equipment and Impairment of Long-Lived Assets to our consolidated financial statements under Item 8 of this Form 10-K for further information. Environmental Matters and Asset Retirement Obligations We record liabilities when environmental assessments and/or remedial efforts are probable and can be reasonably estimated.
Please read Note 9—Property, Plant, and Equipment to our consolidated financial statements under Item 8 of this Form 10-K for further information. Environmental Matters and Asset Retirement Obligations We record liabilities when environmental assessments and/or remedial efforts are probable and can be reasonably estimated.
Beginning with financial results reported for the fourth quarter of 2023, Adjusted Gross Margin, Adjusted Net Income (Loss), and Adjusted EBITDA excludes all hedge losses (gains) associated with our Washington ending inventory and LIFO layer increment impacts associated with our Washington inventory.
Beginning with financial results reported for the fourth quarter of 2023, Adjusted Gross Margin, Adjusted Net Income (Loss), and Adjusted EBITDA also exclude all hedge losses (gains) associated with our Washington ending inventory and LIFO layer increment impacts associated with our Washington inventory.
For the year ended December 31, 2023, our debt extinguishment and commitment costs wer e approximately $19.2 million in connection with the refinancing of our long-term debt in the first quarter of 2023 and the termination of the Washington Refinery Intermediation Agreement in the fourth quarter of 2023.
For the year ended December 31, 2023, our Debt extinguishment and commitment costs were approximately $19.2 million in connection with the refinancing of our long-term debt in the first quarter of 2023 and the termination of the Washington Refinery Intermediation Agreement in the fourth quarter of 2023.
For the year ended December 31, 2023, operating expense (excluding depreciation) was approximately $485.6 million, an increase of $152.4 million compa red to $333.2 million for the year ended December 31, 2022. $134.1 million of the increase was contributed by the Billings Acquisition. Other factors that drove the increase include higher repair and maintenance and employee expenses.
For the year ended December 31, 2023, Operating expense (excluding depreciation) was approximately $485.6 million, an increase of $152.4 million compared to $333.2 million for the year ended December 31, 2022. $134.1 million of the increase was contributed by the Billings Acquisition. Other factors that drove the increase include higher repair and maintenance and employee expenses. Depreciation and Amortization .
For the year ended December 31, 2023, cost of revenues (excluding depreciation) was $6.8 billion, a $0.4 billion increase compared to $6.4 billion for the year ended December 31, 2022, inclusive of a $1.5 billion contribution from the Billings Acquisitio n.
Cost of Revenues (Excluding Depreciation). For the year ended December 31, 2023, Cost of revenues (excluding depreciation) was $6.8 billion, a $0.4 billion increase compared to $6.4 billion for the year ended December 31, 2022, inclusive of a $1.5 billion contribution from the Billings Acquisition.
If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases, or price increases could lead to a decline in demand for our products, which could have a material effect on our business, financial condition, or results of operations. The COVID-19 Pandemic.
If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases, or price increases could lead to a decline in demand for our products, which could have a material effect on our business, financial condition, or results of operations. Geopolitical Conflicts.
Below is a summary of key operating statistics for the retail segment for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 Retail Segment Retail sales volumes (thousands of gallons) 117,550 105,456 109,150 Non-GAAP Performance Measures Management uses certain financial measures to evaluate our operating performance that are considered non-GAAP financial measures.
Below is a summary of key operating statistics for the retail segment for the years ended December 31, 2024, 2023, and 2022: Year Ended December 31, 2024 2023 2022 Retail Segment Retail sales volumes (thousands of gallons) 121,473 117,550 105,456 Non-GAAP Performance Measures Management uses certain financial measures to evaluate our operating performance that are considered non-GAAP financial measures.
Adjusted Net Income (Loss) and Adjusted EBITDA Adjusted Net Income (Loss) is defined as Net income (loss) excluding: • inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, hedge losses (gains) associated with our Washington ending inventory and intermediation obligation, purchase price allocation adjustments, and LIFO layer increment and decrement impacts associated with our Washington inventory); • Environmental obligation mark-to-market adjustments (which represents the mark-to-market losses (gains) associated with our RINs and Washington CCA and Clean Fuel Standard); • unrealized (gain) loss on derivatives; • acquisition and integration costs; • redevelopment and other costs related to Par West; • debt extinguishment and commitment costs; • increase in (release of) tax valuation allowance and other deferred tax items; • changes in the value of contingent consideration and common stock warrants; • severance costs; • (gain) loss on sale of assets; • impairment expense; • impairment expense associated with our investment in Laramie Energy; and • Par’s share of equity losses from Laramie Energy, LLC, excluding cash distributions .
Adjusted Net Income (Loss) and Adjusted EBITDA Adjusted Net Income (Loss) is defined as Net income (loss) excluding: • inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, hedge losses (gains) associated with our Washington ending inventory and intermediation obligation, purchase price allocation adjustments, and LIFO layer increment and decrement impacts associated with our Washington inventory); • Environmental obligation mark-to-market adjustments (which represents the mark-to-market losses (gains) associated with our RINs and Washington CCA and Clean Fuel Standard); • unrealized (gain) loss on derivatives; • acquisition and integration costs; • redevelopment and other costs related to Par West; • debt extinguishment and commitment costs; • increase in (release of) tax valuation allowance and other deferred tax items; • changes in the value of contingent consideration and common stock warrants; • severance costs and other non-operating expense (income); • (gain) loss on sale of assets; • impairment expense; • impairment expense associated with our investment in Laramie Energy; • Par’s share of equity (earnings) losses from Laramie Energy, LLC, excluding cash distributions; and • Par’s portion of accounting policy differences from refining and logistics investments. 39 Adjusted EBITDA is defined as Adjusted Net Income (Loss) excluding: • D&A; • interest expense and financing costs, net, excluding interest rate derivative loss (gain); • cash distributions from Laramie Energy, LLC to Par; • Par's portion of interest, taxes, and D&A expense from refining and logistics investments; and • income tax expense (benefit) excluding the increase in (release of) tax valuation allowance.
The increase in operating income was primarily driven by $10.6 million related to higher fuel sales volum es and $3.4 million associated with increased merchandise sales, partly offset by $6.3 million of higher operating expenses driven by i ncreases in employee costs and credit card fees in the year ended December 31, 2023 compared to the year ended December 31, 2022.
The increase in Operating income was primarily driven by $10.6 million related to higher fuel sales volumes and $3.4 million associated with increased merchandise sales, partly offset by $6.3 million of higher operating expenses driven by increases in employee costs and credit card fees in the year ended December 31, 2023 compared to the year ended December 31, 2022.
We operate in logistically complex, niche markets and, as such, each of our refineries has unique cost advantages and disadvantages as compared to their respective relevant market indices. Recent Events Affecting Comparability of Periods Inflation. Energy prices are, among other factors, indicators of inflation, and the U.S.
We operate in logistically complex, niche markets and, as such, each of our refineries has unique cost advantages and disadvantages as compared to their respective relevant market indices. Recent Events Affecting Comparability of Periods Inflation. Energy prices are, among other factors, indicators of inflation, and the U.S. Federal Reserve (the “Fed”) has taken significant steps to curb inflation.
(2) For the years ended December 31, 2022 and 2021, there was no change in value of contingent consideration, change in value of common stock warrants, impairments associated with our investment in Laramie Energy, or our share of Laramie Energy’s asset impairment losses in excess of our basis difference.
(3) For the years ended December 31, 2024, 2023 and 2022, there was no change in value of contingent consideration, change in value of common stock warrants, impairment expense, impairments associated with our investment in Laramie Energy, or our share of Laramie Energy’s asset impairment losses in excess of our basis difference.
Discussion of Consolidated Results Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Revenues. For the year ended December 31, 2023, revenues were $8.2 billion, a $0.9 billion increase compared to $7.3 billion for the year ended December 31, 2022.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Revenues. For the year ended December 31, 2023, Revenues were $8.2 billion, a $0.9 billion increase compared to $7.3 billion for the year ended December 31, 2022.
Our capital expenditures and deferred turnaround costs budget for 2024 is approximately $220 to $250 million and primarily relates to scheduled maintenance, capital projects, and turnaround projects related to regulatory compliance, information technology, and growth across each of our businesses. Operating Lease Liabilities.
Our capital expenditures and deferred turnaround costs budget for 2025 is approximately $210 to $240 million and primarily relates to scheduled maintenance, capital projects, and turnaround projects related to regulatory compliance, information technology, and growth across each of our businesses. Operating Lease Liabilities.
Our estimated interest payments due for 2024 are $51.2 million and our total estimated undiscounted future interest payments will be $312.4 million on the debt obligations held as of December 31, 2023 and using interest rates in effect as of December 31, 2023.
Our estimated interest payments due for 2025 are $51.2 million and our total estimated undiscounted future interest payments will be $260.3 million on the debt obligations held as of December 31, 2024, and using interest rates in effect as of December 31, 2024.
Our deferred turnaround costs and capital expenditures, including land and building purchases but excluding acquisitions, for the year ended December 31, 2023, totaled approximately $88.1 million and were primarily related to the 2023 turnaround and related scheduled maintenance work at our Montana refinery, capital projects at our Hawaii and Tacoma refineries, land purchases and new sites at our Retail and Hawaii Logistics businesses, and sustaining maintenance at each of our refineries.
Our deferred turnaround costs and capital expenditures, including land and building purchases but excluding acquisitions, for the year ended December 31, 2024, totaled approximately $209.0 million and were primarily related to the 2024 turnaround and related scheduled maintenance work at our Montana refinery, capital projects at our Hawaii and Tacoma refineries, our Retail businesses, and sustaining maintenance at each of our refineries.
Assets and liabilities measured at fair value on a recurring basis include derivative instruments and environmental credit obligations. We also measure certain assets and liabilities at fair value on a nonrecurring basis when specific triggering events occur, such as business combinations and events which indicate that a reporting unit’s carrying value exceeds its estimated fair value.
We also measure certain assets and liabilities at fair value on a nonrecurring basis when specific triggering events occur, such as business combinations and events which indicate that a reporting unit’s carrying value exceeds its estimated fair value.
The Singapore 3-1-2 index declined from $25.43 in the year ended December 31, 2022 to $19.50 during the year ended December 31, 2023. • Adjusted Gross Margin for the Wyoming refinery decreased by $1.35 per barrel from $26.50 per barrel during the year ended December 31, 2022 to $25.15 per barrel during the year ended December 31, 2023.
The Hawaii Index declined from $19.21 in the year ended December 31, 2022, to $13.06 during the year ended December 31, 2023. • Adjusted Gross Margin for the Wyoming refinery decreased by $1.35 per barrel from $26.50 per barrel during the year ended December 31, 2022, to $25.15 per barrel during the year ended December 31, 2023.
Purchase commitments primarily consist of contracts executed as of December 31, 2023 for the purchase of crude oil for use at our refineries that are scheduled for delivery in 2024. As of December 31, 2023, we have material purchase commitments of $1.3 billion, with required cash outlays primarily expected in the next twelve months. Supply and Offtake Agreement.
Purchase commitments primarily consist of contracts executed as of December 31, 2024, for the purchase of crude oil for use at our refineries that are scheduled for delivery in 2025. As of December 31, 2024, we have material purchase commitments of $3.4 billion, with required cash outlays primarily expected in the next twelve months. Environmental Matters.
The RVO Adjusted USGC 3-2-1 index declined from $28.55 during the year ended December 31, 2022 to $22.87 in the year ended December 31, 2023. • Adjusted Gross Margin for the Washington refinery decreased by $8.59 per barrel from $18.00 per barrel during the year ended December 31, 2022 to $9.41 per barrel during the year ended December 31, 2023, primarily due to higher environmental credit obligation expenses, declining crack spreads, and higher refined product delivery costs, partially offset by lower feedstock costs and 5% higher refined product sales volumes .
The Wyoming Index declined from $26.33 in the year ended December 31, 2022, to $24.48 during the year ended December 31, 2023. • Adjusted Gross Margin for the Washington refinery decreased by $8.59 per barrel from $18.00 per barrel during the year ended December 31, 2022, to $9.41 per barrel during the year ended December 31, 2023, primarily due to higher environmental credit obligation expenses, declining crack spreads, and higher refined product delivery costs, partially offset by lower feedstock costs and 5% higher refined product sales volumes.
The change is primarily due t o a 8% increase in refined product sales volumes, partially offset by lower crack spreads.
The change is primarily due to an 8% increase in refined product sales volumes, partially offset by lower crack spreads.
We have recast Adjusted Net Income (Loss) and Adjusted EBITDA for prior periods when reported to conform to the modified presentation. 36 Beginning with financial results reported for the second quarter of 2023, Adjusted Gross Margin, Adjusted Net Income (Loss), and Adjusted EBITDA also exclude our portion of interest, taxes, and depreciation expense from our refining and logistics investments acquired on June 1, 2023, as part of the Billings Acquisition.
Beginning with financial results reported for the second quarter of 2023, Adjusted Gross Margin, Adjusted Net Income (Loss), and Adjusted EBITDA exclude our portion of interest, taxes, and depreciation expense from our refining and logistics investments acquired on June 1, 2023, as part of the Billings Acquisition.
For the year ended December 31, 2023, we recorded an income tax benefit of $115.3 million primarily related to the release of the federal tax valuation allowance in the fourth quarter of 2024, partially offset by deferred tax expense from net operating loss utilization and state tax expense.
For the year ended December 31, 2023, we recorded an Income tax benefit of $115.3 million primarily related to the release of the federal tax valuation allowance in the fourth quarter of 2023, partially offset by state taxes.
(2) Includes eliminations of intersegment Revenues and Cost of revenues (excluding depreciation) of $590.8 million, $493.3 million, and $402.2 million for the years ended December 31, 2023, 2022, and 2021, respectively. 33 Below is a summary of key operating statistics for the refining segment for the years ended December 31, 2023, 2022, and 2021: Year Ended December 31, 2023 2022 2021 Total Refining Segment Feedstocks Throughput (Mbpd) (1) 170.3 133.8 135.2 Refined product sales volume (Mbpd) (1) 183.1 140.3 138.8 Hawaii Refinery Feedstocks Throughput (Mbpd) 80.8 81.8 82.0 Yield (% of total throughput) Gasoline and gasoline blendstocks 26.3 % 25.6 % 24.8 % Distillates 40.4 % 38.8 % 45.0 % Fuel oils 28.9 % 31.4 % 26.6 % Other products 1.1 % 0.7 % 0.6 % Total yield 96.7 % 96.5 % 97.0 % Refined product sales volume (Mbpd) 89.1 84.0 82.6 Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 15.25 $ 13.99 $ 4.56 Production costs per bbl ($/throughput bbl) (3) 4.57 4.86 3.98 D&A per bbl ($/throughput bbl) 0.65 0.67 0.66 Montana Refinery Feedstocks Throughput (Mbpd) (1) 54.4 — — Yield (% of total throughput) Gasoline and gasoline blendstocks 48.1 % — % — % Distillates 32.0 % — % — % Asphalt 12.1 % — % — % Other products 3.2 % — % — % Total yield 95.4 % — % — % Refined product sales volume (Mbpd) 58.6 — — Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 21.14 $ — $ — Production costs per bbl ($/throughput bbl) (3) 10.78 — — D&A per bbl ($/throughput bbl) 1.45 — — Washington Refinery Feedstocks Throughput (Mbpd) 40.0 35.5 36.3 Yield (% of total throughput) Gasoline and gasoline blendstocks 23.5 % 24.0 % 23.7 % Distillates 34.5 % 34.3 % 34.5 % Asphalt 19.7 % 20.3 % 20.7 % Other products 18.7 % 18.2 % 18.3 % Total yield 96.4 % 96.8 % 97.2 % 34 Year Ended December 31, 2023 2022 2021 Refined product sales volume (Mbpd) 41.7 39.7 39.6 Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 9.41 $ 18.00 $ 2.98 Production costs per bbl ($/throughput bbl) (3) 4.12 4.01 3.86 D&A per bbl ($/throughput bbl) 1.91 2.19 1.57 Wyoming Refinery Feedstocks Throughput (Mbpd) 17.6 16.5 16.9 Yield (% of total throughput) Gasoline and gasoline blendstocks 47.1 % 49.7 % 47.3 % Distillates 46.7 % 43.1 % 45.7 % Fuel oil 2.5 % 2.4 % 2.2 % Other products 1.5 % 2.1 % 1.7 % Total yield 97.8 % 97.3 % 96.9 % Refined product sales volume (Mbpd) 17.9 16.6 16.6 Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 25.15 $ 26.50 $ 14.47 Production costs per bbl ($/throughput bbl) (3) 7.50 7.32 6.22 D&A per bbl ($/throughput bbl) 2.69 2.85 2.86 Market Indices (average $ per barrel) 3-1-2 Singapore Crack Spread (4) $ 19.50 $ 25.43 $ 6.22 RVO Adjusted Pacific Northwest 3-1-1-1 Index (5) 25.82 35.27 13.69 RVO Adjusted USGC 3-2-1 Index (6) 22.87 28.55 10.98 Crude Oil Prices (average $ per barrel) Brent $ 82.17 $ 99.04 $ 70.95 WTI 77.60 94.33 68.11 ANS (7) 82.36 98.76 70.56 Bakken Clearbrook (7) 78.58 96.37 67.65 WCS Hardisty (7) 59.34 73.28 53.90 Brent M1-M3 0.81 3.49 1.12 ________________________________________________________ (1) Feedstocks throughput and sales volumes per day for the Montana refinery for the year ended December 31, 2023 are calculated based on the 214-day period for which we owned the Montana refinery in 2023.
(2) Includes eliminations of intersegment Revenues and Cost of revenues (excluding depreciation) of $643.7 million, $590.8 million, and $493.3 million for the years ended December 31, 2024, 2023, and 2022, respectively. 33 Below is a summary of key operating statistics for the refining segment for the years ended December 31, 2024, 2023, and 2022: Year Ended December 31, 2024 2023 2022 Total Refining Segment Feedstocks Throughput (Mbpd) (1) 186.7 170.3 133.8 Refined product sales volume (Mbpd) (1) 199.9 183.1 140.3 Hawaii Refinery Feedstocks Throughput (Mbpd) 81.1 80.8 81.8 Yield (% of total throughput) Gasoline and gasoline blendstocks 26.2 % 26.3 % 25.6 % Distillates 38.9 % 40.4 % 38.8 % Fuel oils 31.3 % 28.9 % 31.4 % Other products 0.2 % 1.1 % 0.7 % Total yield 96.6 % 96.7 % 96.5 % Refined product sales volume (Mbpd) 89.3 89.1 84.0 Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 9.34 $ 15.25 $ 13.99 Production costs per bbl ($/throughput bbl) (3) 4.58 4.57 4.86 D&A per bbl ($/throughput bbl) 0.43 0.65 0.67 Montana Refinery Feedstocks Throughput (Mbpd) (1) 49.9 54.4 — Yield (% of total throughput) Gasoline and gasoline blendstocks 48.0 % 48.1 % — % Distillates 31.9 % 32.0 % — % Asphalt 10.9 % 12.1 % — % Other products 3.9 % 3.2 % — % Total yield 94.7 % 95.4 % — % Refined product sales volume (Mbpd) (1) 53.2 58.6 — Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 11.37 $ 21.14 $ — Production costs per bbl ($/throughput bbl) (3) 12.42 10.78 — D&A per bbl ($/throughput bbl) 1.83 1.45 — Washington Refinery Feedstocks Throughput (Mbpd) 38.2 40.0 35.5 Yield (% of total throughput) Gasoline and gasoline blendstocks 23.9 % 23.5 % 24.0 % Distillates 34.5 % 34.5 % 34.3 % Asphalt 18.8 % 19.7 % 20.3 % Other products 19.3 % 18.7 % 18.2 % Total yield 96.5 % 96.4 % 96.8 % 34 Year Ended December 31, 2024 2023 2022 Refined product sales volume (Mbpd) 39.2 41.7 39.7 Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 3.25 $ 9.41 $ 18.00 Production costs per bbl ($/throughput bbl) (3) 4.28 4.12 4.01 D&A per bbl ($/throughput bbl) 1.97 1.91 2.19 Wyoming Refinery Feedstocks Throughput (Mbpd) 17.5 17.6 16.5 Yield (% of total throughput) Gasoline and gasoline blendstocks 46.9 % 47.1 % 49.7 % Distillates 47.1 % 46.7 % 43.1 % Fuel oil 2.4 % 2.5 % 2.4 % Other products 2.1 % 1.5 % 2.1 % Total yield 98.5 % 97.8 % 97.3 % Refined product sales volume (Mbpd) 18.2 17.9 16.6 Adjusted Gross Margin per bbl ($/throughput bbl) (2) $ 13.73 $ 25.15 $ 26.50 Production costs per bbl ($/throughput bbl) (3) 8.10 7.50 7.32 D&A per bbl ($/throughput bbl) 2.71 2.69 2.85 Par Pacific Indices ($ per barrel) Hawaii Index (4) $ 7.21 $ 13.06 $ 19.21 Montana Index (5) 14.39 23.71 26.84 Washington Index (6) 4.13 9.81 19.85 Wyoming Index (7) 16.47 24.48 26.33 Market Cracks (average $ per barrel) Singapore 3.1.2 Product Crack (4) $ 13.36 $ 19.50 $ 25.43 Montana 6.3.2.1 Product Crack (5) 21.59 30.15 35.93 Washington 3.1.1.1 Product Crack (6) 12.11 17.91 29.58 Wyoming 2.1.1 Product Crack (7) 18.48 27.52 32.35 Crude Oil Prices (average $ per barrel) (8) Brent $ 79.86 $ 82.17 $ 99.04 WTI 75.76 77.60 94.33 ANS (-) Brent 1.55 0.95 3.27 Bakken Guernsey (-) WTI (1.26) (0.65) 2.34 Bakken Williston (-) WTI (2.45) (0.09) 2.70 WCS Hardisty (-) WTI (13.90) (17.92) (19.14) MSW (-) WTI (4.03) (3.70) (1.56) Brent M1-M3 1.10 0.81 3.49 35 ________________________________________________________ (1) The 2024 amounts for the total refining segment represent the sum of the Hawaii, Montana, Washington, and Wyoming refineries’ throughput or sales volumes averaged over the year ended December 31, 2024.
Please read Note 14—Debt and Note 12—Inventory Financing Agreements to our 42 consolidated financial statements under Item 8 of this Form 10-K for further discussion on our indebtedness and inventory financing, respectively. Debt extinguishment and commitment costs.
Please read Note 12—Inventory Financing Agreements and Note 14—Debt to our consolidated financial statements under Item 8 of this Form 10-K for further discussion. Capital Expenditures and Turnaround Costs.
For the year ended December 31, 2022, Adjusted Net Income was $474.7 million compared to an Adjusted Net Loss of $39.0 million for the year ended December 31, 2021.
For the year ended December 31, 2023, Adjusted Net Income was $501.2 million compared to an Adjusted Net Income of $474.7 million for the year ended December 31, 2022.
The Term Loan Credit Agreement may also require annual prepayments of principal with a variable percentage of our excess cash flow, 50% or 25% depending on our consolidated year end secured leverage ratio (as defined in the Term Loan Credit Agreement). 52 Cash Flows The following table summarizes cash activities for the years ended December 31, 2023, 2022, and 2021 (in thousands): Years Ended December 31, 2023 2022 2021 Net cash provided by (used in) operating activities $ 579,156 $ 452,606 $ (27,622) Net cash provided by (used in) investing activities (659,039) (87,308) 74,628 Net cash provided by (used in) financing activities (135,597) 13,407 (1,094) Cash flows for the year ended December 31, 2023 Net cash provided by operating activities for the year ended December 31, 2023 was driven primarily by net income of $728.6 million, non-cash earnings from operations of approximately $53.2 million, and net cash used for changes in operating assets and liabilities of approximately $96.3 million.
The Term Loan Credit Agreement may also require annual prepayments of principal with a variable percentage of our excess cash flow, 50%, 25%, or 0% depending on our consolidated year end secured leverage ratio (as defined in the Term Loan Credit Agreement). 56 Cash Flows The following table summarizes cash activities for the years ended December 31, 2024, 2023, and 2022 (in thousands): Years Ended December 31, 2024 2023 2022 Net cash provided by operating activities $ 83,776 $ 579,156 $ 452,606 Net cash used in investing activities (133,994) (659,039) (87,308) Net cash provided by (used in) financing activities (36,961) (135,597) 13,407 Cash flows for the year ended December 31, 2024 Net cash provided by operating activities for the year ended December 31, 2024, was driven primarily by non-cash charges to operations of approximately $208.6 million, net cash used for changes in operating assets and liabilities of approximately $91.5 million, and a net loss of $33.3 million.
The following tables present a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure, net income (loss), on a historical basis for the periods indicated (in thousands): Year Ended December 31, 2023 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Net income (loss) $ 728,642 $ 454,102 $ (454,102) $ 728,642 Inventory valuation adjustment — 102,710 — 102,710 Environmental obligation mark-to-market adjustments — (189,783) — (189,783) Unrealized loss (gain) on derivatives — (49,690) — (49,690) Par West redevelopment and other costs — 11,397 — 11,397 Acquisition and integration costs — 17,482 — 17,482 Debt extinguishment and commitment costs — 19,182 — 19,182 Severance costs 492 1,293 — 1,785 Equity losses from Laramie Energy, LLC, excluding cash distributions — — (14,279) (14,279) Loss (gain) on sale of assets, net 30 (89) — (59) Depreciation and amortization 1,618 118,024 188 119,830 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 24 71,968 (363) 71,629 Laramie Energy, LLC cash distributions to Par — — (10,706) (10,706) Par's portion of interest, taxes, and depreciation expense from refining and logistics investments — — 3,443 3,443 Equity losses (income) from subsidiaries (759,528) — 759,528 — Income tax expense (benefit) — 153,017 (268,353) (115,336) Adjusted EBITDA (1) $ (28,722) $ 709,613 $ 15,356 $ 696,247 50 Year Ended December 31, 2022 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Net income (loss) $ 364,189 $ 289,575 $ (289,575) $ 364,189 Inventory valuation adjustment — (15,712) — (15,712) Environmental obligation mark-to-market adjustments — 105,760 — 105,760 Unrealized loss on derivatives — 9,336 — 9,336 Acquisition and integration costs 3,396 267 — 3,663 Debt extinguishment and commitment costs — 5,329 — 5,329 Severance costs 351 1,921 — 2,272 Loss (gain) on sale of assets, net 27 (196) — (169) Depreciation and amortization 2,131 97,448 190 99,769 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 1 68,655 (368) 68,288 Equity losses (income) from subsidiaries (388,008) — 388,008 — Income tax expense (benefit) 362 96,995 (96,647) 710 Adjusted EBITDA (1) $ (17,551) $ 659,378 $ 1,608 $ 643,435 Year Ended December 31, 2021 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Net income (loss) $ (81,297) $ (91,010) $ 91,010 $ (81,297) Inventory valuation adjustment — 31,841 — 31,841 Environmental obligation mark-to-market adjustments — 66,350 — 66,350 Unrealized gain on derivatives — (1,393) — (1,393) Acquisition and integration costs 87 — — 87 Debt extinguishment and commitment costs — 6,728 1,416 8,144 Severance costs — 84 — 84 Impairment expense — 1,838 — 1,838 Loss (gain) on sale of assets, net 15 (10,949) (53,763) (64,697) Depreciation and amortization 2,452 91,550 239 94,241 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 2,600 67,119 (316) 69,403 Equity losses (income) from subsidiaries 63,649 — (63,649) — Income tax expense (benefit) 26 (24,835) 25,830 1,021 Adjusted EBITDA (1) $ (12,468) $ 137,323 $ 767 $ 125,622 ________________________________________________________ (1) Please read the Non-GAAP Performance Measures and Adjusted Net Income (Loss) and Adjusted EBITDA discussions above for information regarding the components of Adjusted Net Income (Loss) and Adjusted EBITDA.
The following tables present a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure, Net income (loss), on a historical basis for the periods indicated (in thousands): Year Ended December 31, 2024 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Net income (loss) $ (33,322) $ (12,861) $ 12,861 $ (33,322) Inventory valuation adjustment — (490) — (490) Environmental obligation mark-to-market adjustments — (19,136) — (19,136) Unrealized loss on derivatives — 42,485 — 42,485 Par West redevelopment and other costs — 12,548 — 12,548 Acquisition and integration costs — 100 — 100 Debt extinguishment and commitment costs — 1,688 — 1,688 Severance costs and other non-operating expense (2) 7,354 7,448 — 14,802 Equity losses from Laramie Energy, LLC, excluding cash distributions — — 1,781 1,781 Par's portion of accounting policy differences from refining and logistics investments 3,856 3,856 Loss (gain) on sale of assets, net 100 122 — 222 Depreciation and amortization 1,636 129,766 188 131,590 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 40 83,902 (353) 83,589 Laramie Energy, LLC cash distributions to Par — — (1,485) (1,485) Par's portion of interest, taxes, depreciation and amortization expense from refining and logistics investments — — 6,144 6,144 Equity losses (income) from subsidiaries (1,975) — 1,975 — Income tax expense (benefit) — (2,659) (3,037) (5,696) Adjusted EBITDA (1) $ (26,167) $ 242,913 $ 21,930 $ 238,676 54 Year Ended December 31, 2023 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Net income (loss) $ 728,642 $ 454,102 $ (454,102) $ 728,642 Inventory valuation adjustment — 102,710 — 102,710 Environmental obligation mark-to-market adjustments — (189,783) — (189,783) Unrealized gain on derivatives — (49,690) — (49,690) Par West redevelopment and other costs — 11,397 — 11,397 Acquisition and integration costs — 17,482 — 17,482 Debt extinguishment and commitment costs — 19,182 — 19,182 Severance costs and other non-operating expense 492 1,293 — 1,785 Equity earnings from Laramie Energy, LLC, excluding cash distributions — — (14,279) (14,279) Loss (gain) on sale of assets, net 30 (89) — (59) Depreciation and amortization 1,618 118,024 188 119,830 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 24 71,968 (363) 71,629 Laramie Energy, LLC cash distributions to Par — — (10,706) (10,706) Par's portion of interest, taxes, depreciation and amortization expense from refining and logistics investments — — 3,443 3,443 Equity losses (income) from subsidiaries (759,528) — 759,528 — Income tax expense (benefit) — 153,017 (268,353) (115,336) Adjusted EBITDA (1) $ (28,722) $ 709,613 $ 15,356 $ 696,247 Year Ended December 31, 2022 Parent Guarantor Par Borrower and Subsidiaries Non-Guarantor Subsidiaries and Eliminations Par Pacific Holdings, Inc. and Subsidiaries Net income (loss) $ 364,189 $ 289,575 $ (289,575) $ 364,189 Inventory valuation adjustment — (15,712) — (15,712) Environmental obligation mark-to-market adjustments — 105,760 — 105,760 Unrealized loss on derivatives — 9,336 — 9,336 Acquisition and integration costs 3,396 267 — 3,663 Debt extinguishment and commitment costs — 5,329 — 5,329 Severance costs and other non-operating expense 351 1,921 — 2,272 Loss (gain) on sale of assets, net 27 (196) — (169) Depreciation and amortization 2,131 97,448 190 99,769 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 1 68,655 (368) 68,288 Equity losses (income) from subsidiaries (388,008) — 388,008 — Income tax expense (benefit) 362 96,995 (96,647) 710 Adjusted EBITDA (1) $ (17,551) $ 659,378 $ 1,608 $ 643,435 ________________________________________________________ (1) Please read the Non-GAAP Performance Measures and Adjusted Net Income (Loss) and Adjusted EBITDA discussions above for information regarding the components of Adjusted Net Income (Loss) and Adjusted EBITDA.
The change was primarily related to the same factors described above for the increase in Adjusted EBITDA. 31 The following table summarizes our consolidated results of operations for the years ended December 31, 2023, 2022, and 2021 (in thousands).
The improvement was primarily related to the same factors described above for the increase in Adjusted EBITDA, partially offset by a $20.0 million increase in Depreciation and amortization. 31 The following table summarizes our consolidated results of operations for the years ended December 31, 2024, 2023, and 2022 (in thousands).
The following table presents a reconciliation of Adjusted Net Income (Loss) and Adjusted EBITDA to the most directly comparable GAAP financial measure, net income (loss), on a historical basis for the periods indicated (in thousands): Year Ended December 31, 2023 2022 2021 Net income (loss) $ 728,642 $ 364,189 $ (81,297) Inventory valuation adjustment 102,710 (15,712) 31,841 Environmental obligation mark-to-market adjustments (189,783) 105,760 66,350 Unrealized loss (gain) on derivatives (49,690) 9,336 (1,393) Par West redevelopment and other costs 11,397 — — Acquisition and integration costs 17,482 3,663 87 Debt extinguishment and commitment costs 19,182 5,329 8,144 Changes in valuation allowance and other deferred tax items (1) (126,219) — — Severance costs 1,785 2,272 84 Impairment expense — — 1,838 Equity losses from Laramie Energy, LLC, excluding cash distributions (14,279) — — Gain on sale of assets, net (59) (169) (64,697) Adjusted Net Income (Loss) (2) 501,168 474,668 (39,043) Depreciation and amortization 119,830 99,769 94,241 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 71,629 68,288 69,403 Laramie Energy, LLC cash distributions to Par (10,706) — — Par's portion of interest, taxes, and depreciation expense from refining and logistics investments 3,443 — — Income tax expense 10,883 710 1,021 Adjusted EBITDA (2) $ 696,247 $ 643,435 $ 125,622 ________________________________________________________ (1) For the year ended December 31, 2023, recognized a non-cash deferred tax benefit of $126.2 million related to the release of a majority of the valuation allowance against our federal net deferred tax assets.
The following table presents a reconciliation of Adjusted Net Income (Loss) and Adjusted EBITDA to the most directly comparable GAAP financial measure, Net income (loss), on a historical basis for the periods indicated (in thousands): Year Ended December 31, 2024 2023 2022 Net income (loss) $ (33,322) $ 728,642 $ 364,189 Inventory valuation adjustment (490) 102,710 (15,712) Environmental obligation mark-to-market adjustments (19,136) (189,783) 105,760 Unrealized loss (gain) on derivatives 42,485 (49,690) 9,336 Par West redevelopment and other costs 12,548 11,397 — Acquisition and integration costs 100 17,482 3,663 Debt extinguishment and commitment costs 1,688 19,182 5,329 Changes in valuation allowance and other deferred tax items (1) (3,315) (126,219) — Severance costs and other non-operating expenses (2) 14,802 1,785 2,272 Equity losses (earnings) from Laramie Energy, LLC, excluding cash distributions 1,781 (14,279) — Par's portion of accounting policy differences from refining and logistics investments 3,856 — — Loss (gain) on sale of assets, net 222 (59) (169) Adjusted Net Income (2)(4) 21,219 501,168 474,668 Depreciation and amortization 131,590 119,830 99,769 Interest expense and financing costs, net, excluding unrealized interest rate derivative loss (gain) 83,589 71,629 68,288 Laramie Energy, LLC cash distributions to Par (1,485) (10,706) — Par's portion of interest, taxes, depreciation and amortization expense from refining and logistics investments 6,144 3,443 — Income tax expense (benefit) (2,381) 10,883 710 Adjusted EBITDA (3) $ 238,676 $ 696,247 $ 643,435 ________________________________________________________ (1) For the years ended December 31, 2024 and 2023, we recognized a non-cash deferred tax benefit of $3.3 million and $126.2 million, respectively.
The following tables present a reconciliation of Adjusted Gross Margin to the most directly comparable GAAP financial measure, operating income (loss), on a historical basis, for selected segments, for the periods indicated (in thousands): Year ended December 31, 2023 Refining Logistics Retail Operating income $ 676,161 $ 69,744 $ 56,603 Operating expense (excluding depreciation) 373,612 24,450 87,525 Depreciation and amortization 81,017 25,122 11,462 Par’s portion of interest, taxes, and depreciation expense from refining and logistics investments 1,586 1,857 — Inventory valuation adjustment 102,710 — — Environmental obligation mark-to-market adjustments (189,783) — — Unrealized gain on derivatives (50,511) — — Loss (gain) on sale of assets, net 219 — (308) Adjusted Gross Margin (1) $ 995,011 $ 121,173 $ 155,282 37 Year ended December 31, 2022 Refining Logistics Retail Operating income $ 401,901 $ 54,049 $ 49,238 Operating expense (excluding depreciation) 236,989 14,988 81,229 Depreciation and amortization 65,472 20,579 10,971 Inventory valuation adjustment (15,712) — — Environmental obligation mark-to-market adjustments 105,760 — — Unrealized loss on derivatives 9,336 — — Par West redevelopment and other costs 9,003 — — Loss (gain) on sale of assets, net 1 (253) 56 Adjusted Gross Margin (1) $ 812,750 $ 89,363 $ 141,494 Year ended December 31, 2021 Refining Logistics Retail Operating income (loss) $ (88,799) $ 51,159 $ 81,249 Operating expense (excluding depreciation) 203,511 14,722 71,845 Depreciation and amortization 58,258 22,044 10,880 Impairment expense 1,838 — — Inventory valuation adjustment 31,841 — — Environmental obligation mark-to-market adjustments 66,350 — — Unrealized loss on derivatives 1,517 — — Par West redevelopment and other costs 9,591 — — Gain on sale of assets, net (19,659) (19) (45,034) Adjusted Gross Margin (1) $ 264,448 $ 87,906 $ 118,940 ________________________________________ (1) For the years ended December 31, 2023 and 2022, there was no impairment expense.
The following tables present a reconciliation of Adjusted Gross Margin to the most directly comparable GAAP financial measure, Operating income (loss), on a historical basis, for selected segments, for the periods indicated (in thousands): Year ended December 31, 2024 Refining Logistics Retail Operating income $ 17,412 $ 89,351 $ 64,800 Operating expense (excluding depreciation) 479,737 15,676 88,869 Depreciation and amortization 91,108 27,033 11,037 Par’s portion of interest, taxes, and depreciation and amortization expense from refining and logistics investments 2,493 3,651 — Inventory valuation adjustment (490) — — Environmental obligation mark-to-market adjustments (19,136) — — Unrealized loss on derivatives 43,281 — — Par's portion of accounting policy differences from refining and logistics investments 3,856 — — Loss (gain) on sale of assets, net 8 124 (10) Adjusted Gross Margin (1) $ 618,269 $ 135,835 $ 164,696 38 Year ended December 31, 2023 Refining Logistics Retail Operating income $ 676,161 $ 69,744 $ 56,603 Operating expense (excluding depreciation) 373,612 24,450 87,525 Depreciation and amortization 81,017 25,122 11,462 Par’s portion of interest, taxes, and depreciation and amortization expense from refining and logistics investments 1,586 1,857 — Inventory valuation adjustment 102,710 — — Environmental obligation mark-to-market adjustments (189,783) — — Unrealized gain on derivatives (50,511) — — Loss (gain) on sale of assets, net 219 — (308) Adjusted Gross Margin (1) (2) $ 995,011 $ 121,173 $ 155,282 Year ended December 31, 2022 Refining Logistics Retail Operating income $ 401,901 $ 54,049 $ 49,238 Operating expense (excluding depreciation) 236,989 14,988 81,229 Depreciation and amortization 65,472 20,579 10,971 Inventory valuation adjustment (15,712) — — Environmental obligation mark-to-market adjustments 105,760 — — Unrealized loss on derivatives 9,336 — — Par West redevelopment and other costs 9,003 — — Loss (gain) on sale of assets, net 1 (253) 56 Adjusted Gross Margin (1) (2) $ 812,750 $ 89,363 $ 141,494 ________________________________________ (1) For the years ended December 31, 2024, 2023, and 2022, there was no impairment expense.
The RVO Adjusted Pacific Northwest 3-1-1-1 index declined from $35.27 in the year ended December 31, 2022 to $25.82 during the year ended December 31, 2023. Logistics. For the year ended December 31, 2023, our logistics Adjusted Gross Margin was approximately $121.2 million, an increase of $31.8 million compared to $89.4 million for the year ended December 31, 2022.
The Washington Index declined from $19.85 in the year ended December 31, 2022, to $9.81 during the year ended December 31, 2023. Logistics. For the year ended December 31, 2023, our logistics Adjusted Gross Margin was approximately $121.2 million, an increase of $31.8 million compared to $89.4 million for the year ended December 31, 2022.
Please read the Non-GAAP Performance Measures discussion above for information regarding changes to the components of Adjusted Net Income (Loss) and Adjusted EBITDA made during 2023. Discussion of Operating Income by Segment Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Refining.
Please read the Non-GAAP Performance Measures discussion above for information regarding changes to the components of Adjusted Net Income (Loss) and Adjusted EBITDA made during 2024.
Year Ended December 31, 2023 2022 2021 Revenues $ 8,231,955 $ 7,321,785 $ 4,710,089 Cost of revenues (excluding depreciation) 6,838,109 6,376,014 4,338,474 Operating expense (excluding depreciation) 485,587 333,206 290,078 Depreciation and amortization 119,830 99,769 94,241 Impairment expense — — 1,838 General and administrative expense (excluding depreciation) 91,447 62,396 48,096 Equity earnings from refining and logistics investments (11,844) — — Acquisition and integration costs 17,482 3,663 87 Par West redevelopment and other costs 11,397 9,003 9,591 Gain on sale of assets, net (59) (169) (64,697) Total operating expenses 7,551,949 6,883,882 4,717,708 Operating income (loss) 680,006 437,903 (7,619) Other income (expense) Interest expense and financing costs, net (72,450) (68,288) (66,493) Debt extinguishment and commitment costs (19,182) (5,329) (8,144) Gain on curtailment of pension obligation — — 2,032 Other income (expense), net (53) 613 (52) Equity earnings from Laramie Energy, LLC 24,985 — — Total other expense, net (66,700) (73,004) (72,657) Income (loss) before income taxes 613,306 364,899 (80,276) Income tax benefit (expense) 115,336 (710) (1,021) Net income (loss) $ 728,642 $ 364,189 $ (81,297) 32 The following tables summarize our operating income (loss) by segment for the years ended December 31, 2023, 2022, and 2021 (in thousands).
Year Ended December 31, 2024 2023 2022 Revenues $ 7,974,457 $ 8,231,955 $ 7,321,785 Cost of revenues (excluding depreciation) 7,101,148 6,838,109 6,376,014 Operating expense (excluding depreciation) 584,282 485,587 333,206 Depreciation and amortization 131,590 119,830 99,769 General and administrative expense (excluding depreciation) 108,844 91,447 62,396 Equity earnings from refining and logistics investments (11,905) (11,844) — Acquisition and integration costs 100 17,482 3,663 Par West redevelopment and other costs 12,548 11,397 9,003 Loss (gain) on sale of assets, net 222 (59) (169) Total operating expenses 7,926,829 7,551,949 6,883,882 Operating income 47,628 680,006 437,903 Other income (expense) Interest expense and financing costs, net (82,793) (72,450) (68,288) Debt extinguishment and commitment costs (1,688) (19,182) (5,329) Other income (expense), net (1,869) (53) 613 Equity earnings (losses) from Laramie Energy, LLC (296) 24,985 — Total other expense, net (86,646) (66,700) (73,004) Income (loss) before income taxes (39,018) 613,306 364,899 Income tax benefit (expense) 5,696 115,336 (710) Net income (loss) $ (33,322) $ 728,642 $ 364,189 The following tables summarize our Operating income (loss) by segment for the years ended December 31, 2024, 2023, and 2022 (in thousands).
Net cash used in investing activities for the year ended December 31, 2023 consisted primarily of: • $595.4 million used for the Billings Acquisition, and • $82.3 million in additions to property, plant, and equipment driven by maintenance projects at our refineries and various profit improvement projects, including construction of a flagship retail store in Washington, improved crude processing equipment at our Hawaii refinery, a co-processing unit at our Tacoma refinery, and various IT infrastructure improvements, partially offset by • a $10.7 million cash distribution received from Laramie Energy in the first quarter of 2023. 53 Net cash used in financing activities was approximately $135.6 million for the year ended December 31, 2023 and consisted primarily of the following activities: • net repayments under the Discretionary Draw Facility and MLC receivable advances of $96.0 million, • aggregate payments of $23.1 million of deferred loan costs and debt extinguishment costs, related to our debt refinancing, and • repurchases of common stock of $67.8 million, partially offset by • net borrowings of debt of $145.1 million primarily driven by the refinancing and consolidation of our debt.
Net cash used in investing activities for the year ended December 31, 2023, consisted primarily of: • $595.4 million used for the Billings Acquisition, and • $82.3 million in additions to property, plant, and equipment driven by maintenance projects at our refineries and various profit improvement projects, including construction of a flagship retail store in Washington, improved crude processing equipment at our Hawaii refinery, a co-processing unit at our Tacoma refinery, and various IT infrastructure improvements, partially offset by • a $10.7 million cash distribution received from Laramie Energy in the first quarter of 2023.
Aron Discretionary Draw Facility and MLC receivable advances of $80.7 million, partially offset by • net repayments of debt of $62.0 million primarily driven by the partial repurchase and cancellation of our 7.75% Senior Secured Notes and 12.875% Senior Secured Notes, and • repurchases of common stock of $7.8 million.
Aron Discretionary Draw Facility and MLC receivable advances of $80.7 million, partially offset by • net repayments of debt of $62.0 million primarily driven by the partial repurchase and cancellation of our 7.75% Senior Secured Notes and 12.875% Senior Secured Notes, and • repurchases of common stock of $7.8 million. 59 Cash Requirements We have various cash requirements stemming from investment strategies, contractual obligations, and financial commitments in the normal course of our operations and financing activities.
Year ended December 31, 2023 Refining Logistics (1) Retail Corporate, Eliminations and Other (2) Total Revenues $ 7,969,480 $ 260,779 $ 592,480 $ (590,784) $ 8,231,955 Cost of revenues (excluding depreciation) 6,845,834 145,944 437,198 (590,867) 6,838,109 Operating expense (excluding depreciation) 373,612 24,450 87,525 — 485,587 Depreciation and amortization 81,017 25,122 11,462 2,229 119,830 General and administrative expense (excluding depreciation) — — — 91,447 91,447 Equity earnings from refining and logistics investments (7,363) (4,481) — — (11,844) Acquisition and integration costs — — — 17,482 17,482 Par West redevelopment and other costs — — — 11,397 11,397 Loss (gain) on sale of assets, net 219 — (308) 30 (59) Operating income (loss) $ 676,161 $ 69,744 $ 56,603 $ (122,502) $ 680,006 Year ended December 31, 2022 Refining Logistics (1) Retail Corporate, Eliminations and Other (2) Total Revenues $ 7,046,060 $ 198,821 $ 570,206 $ (493,302) $ 7,321,785 Cost of revenues (excluding depreciation) 6,332,694 109,458 428,712 (494,850) 6,376,014 Operating expense (excluding depreciation) 236,989 14,988 81,229 — 333,206 Depreciation and amortization 65,472 20,579 10,971 2,747 99,769 General and administrative expense (excluding depreciation) — — — 62,396 62,396 Acquisition and integration costs — — — 3,663 3,663 Par West redevelopment and other costs 9,003 — — — 9,003 Loss (gain) on sale of assets, net 1 (253) 56 27 (169) Operating income (loss) $ 401,901 $ 54,049 $ 49,238 $ (67,285) $ 437,903 Year ended December 31, 2021 Refining Logistics (1) Retail Corporate, Eliminations and Other (2) Total Revenues $ 4,471,111 $ 184,734 $ 456,416 $ (402,172) $ 4,710,089 Cost of revenues (excluding depreciation) 4,306,371 96,828 337,476 (402,201) 4,338,474 Operating expense (excluding depreciation) 203,511 14,722 71,845 — 290,078 Depreciation and amortization 58,258 22,044 10,880 3,059 94,241 Impairment expense 1,838 — — — 1,838 General and administrative expense (excluding depreciation) — — — 48,096 48,096 Acquisition and integration costs — — — 87 87 Par West redevelopment and other costs 9,591 — — — 9,591 Loss (gain) on sale of assets, net (19,659) (19) (45,034) 15 (64,697) Operating income (loss) $ (88,799) $ 51,159 $ 81,249 $ (51,228) $ (7,619) ________________________________________________________ (1) Our logistics operations consist primarily of intercompany transactions which eliminate on a consolidated basis.
Year ended December 31, 2024 Refining Logistics (1) Retail Corporate, Eliminations and Other (2) Total Revenues $ 7,733,866 $ 299,532 $ 584,760 $ (643,701) $ 7,974,457 Cost of revenues (excluding depreciation) 7,149,264 175,590 420,064 (643,770) 7,101,148 Operating expense (excluding depreciation) 479,737 15,676 88,869 — 584,282 Depreciation and amortization 91,108 27,033 11,037 2,412 131,590 General and administrative expense (excluding depreciation) — — — 108,844 108,844 Equity earnings from refining and logistics investments (3,663) (8,242) — — (11,905) Acquisition and integration costs — — — 100 100 Par West redevelopment and other costs — — — 12,548 12,548 Loss (gain) on sale of assets, net 8 124 (10) 100 222 Operating income (loss) $ 17,412 $ 89,351 $ 64,800 $ (123,935) $ 47,628 32 Year ended December 31, 2023 Refining Logistics (1) Retail Corporate, Eliminations and Other (2) Total Revenues $ 7,969,480 $ 260,779 $ 592,480 $ (590,784) $ 8,231,955 Cost of revenues (excluding depreciation) 6,845,834 145,944 437,198 (590,867) 6,838,109 Operating expense (excluding depreciation) 373,612 24,450 87,525 — 485,587 Depreciation and amortization 81,017 25,122 11,462 2,229 119,830 General and administrative expense (excluding depreciation) — — — 91,447 91,447 Equity earnings from refining and logistics investments (7,363) (4,481) — — (11,844) Acquisition and integration costs — — — 17,482 17,482 Par West redevelopment and other costs — — — 11,397 11,397 Loss (gain) on sale of assets, net 219 — (308) 30 (59) Operating income (loss) $ 676,161 $ 69,744 $ 56,603 $ (122,502) $ 680,006 Year ended December 31, 2022 Refining Logistics (1) Retail Corporate, Eliminations and Other (2) Total Revenues $ 7,046,060 $ 198,821 $ 570,206 $ (493,302) $ 7,321,785 Cost of revenues (excluding depreciation) 6,332,694 109,458 428,712 (494,850) 6,376,014 Operating expense (excluding depreciation) 236,989 14,988 81,229 — 333,206 Depreciation and amortization 65,472 20,579 10,971 2,747 99,769 General and administrative expense (excluding depreciation) — — — 62,396 62,396 Acquisition and integration costs — — — 3,663 3,663 Par West redevelopment and other costs 9,003 — — — 9,003 Loss (gain) on sale of assets, net 1 (253) 56 27 (169) Operating income (loss) $ 401,901 $ 54,049 $ 49,238 $ (67,285) $ 437,903 ________________________________________________________ (1) Our logistics operations consist primarily of intercompany transactions which eliminate on a consolidated basis.
In addition, we have the Supply and Offtake Agreement, which is used to finance the majority of the inventory at our Hawaii refinery. Generally, the primary uses of our capital resources have been in the operations of our refining and retail segments, for payments related to acquisitions, and to repay or refinance indebtedness.
Generally, the primary uses of our capital resources have been in the operations of our refining and retail segments, for payments related to acquisitions, and to repay or refinance indebtedness.
Given the nature of our operations, including sourcing crude oil and feedstocks, geopolitical conflicts may affect our business and results of operations. The Russia-Ukraine war, the Israel-Palestine conflict, Houthi attacks in the Red Sea, and Iranian activities in the Strait of Hormuz have all disrupted global trade patterns, increased crude oil price volatility, and increased freight costs and delivery times.
The Russia-Ukraine war, the Israel-Palestine conflict, Houthi attacks in the Red Sea, and Iranian activities in the Strait of Hormuz have all continued to disrupt global trade patterns, increase crude oil price volatility, and increase freight costs and delivery times.
A portion of the crude oil utilized at the Hawaii refinery is financed by J. Aron under procurement contracts. The crude oil remains in the legal title of J. Aron and is stored in our storage tanks governed by a storage agreement. Legal title to the crude oil passes to us at the tank outlet. After processing, J.
Crude oil held in storage tanks at, and certain crude oil in transit to, the Hawaii refinery are financed by Citi under procurement contracts. The crude oil remains in the legal title of Citi and is stored in our storage tanks governed by a storage facilities agreement.
Revenues at our retail segment increased $22.3 million primarily due to an 11% increase in sales volume and a 33% increase in merchandise sales, partially offset by an 8% decrease in fuel sales prices. Cost of Revenues (Excluding Depreciation).
Average Brent crude oil prices declined 17% and average WTI crude oil 46 prices declined 18% as compared to the prior period. Revenues at our retail segment increased $22.3 million primarily due to an 11% increase in sales volume and a 33% increase in merchandise sales, partially offset by an 8% decrease in fuel sales prices.
For the year ended December 31, 2022, we recorded an income tax expense of $0.7 million primarily driven by an increase in state taxable income. For the year ended December 31, 2021, we recorded an income tax expense of $1.0 million primarily driven by foreign withholding taxes.
For the year ended December 31, 2022, we recorded an Income tax expense of $0.7 million primarily driven by an increase in state taxable income and recording a valuation allowance against our net deferred tax assets.
Operating income for our logistics segment was $54.0 million for the year ended December 31, 2022, an increase of $2.8 million compared to operating income of $51.2 million for the year ended December 31, 2021.
Operating income for our retail segment was $64.8 million for the year ended December 31, 2024, an increase of $8.2 million compared to $56.6 million for the year ended December 31, 2023.
For the year ended December 31, 2022, we recorded an income tax expense of $0.7 million primarily driven by an increase in state taxable income. Please read Note 22—Income Taxes to our consolidated financial statements under Item 8 of this Form 10-K for more information. Year Ended December 31, 2022 Compared to Year Ended December 31, 2021 Revenues.
For the year ended December 31, 2023, we recorded an income tax benefit of $115.3 million primarily related to the release of the federal tax valuation allowance in the fourth quarter of 2023, partially offset by state taxes. Please read Note 22—Income Taxes to our consolidated financial statements under Item 8 of this Form 10-K for more information.
Year Ended December 31, 2022 Compared to Year Ended December 31, 2021 Net Income (Loss). Our financial results for the year ended December 31, 2022 improved from a net loss of $81.3 million for the year ended December 31, 2021 to net income of $364.2 million for the year ended December 31, 2022.
Results of Operations Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Net Income (Loss). Our financial results for the year ended December 31, 2024, declined from a Net income of $728.6 million for the year ended December 31, 2023, to a Net loss of $33.3 million for the year ended December 31, 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAssuming all other factors remain constant, a $1 per barrel change in average gross refining margins, based on our throughput of 170 Mbpd for the full year of 2023, would change annualized operating income by approximately $61.3 million.
Biggest changeAssuming all other factors remain constant, a $1 per barrel change in average gross refining margins, based on our throughput of 187 Mbpd for the full year of 2024, would change annualized Operating income by approximately $67.2 million. This analysis may differ from actual results.
On June 3, 2022, the EPA finalized the 2021 and 2022 RVOs, reduced the existing 2020 RVO, denied 69 small refinery exemption petitions including ours, and proposed that certain small refineries be permitted to use an alternative RIN retirement schedule for their 2019-2020 compliance obligations. On June 21, 2023, the EPA finalized the 2023, 2024, and 2025 RVOs.
On June 3, 2022, the EPA finalized the 2021 and 2022 RVOs, reduced the existing 2020 RVO, denied 69 small refinery exemption petitions including ours, and proposed that 63 certain small refineries be permitted to use an alternative RIN retirement schedule for their 2019-2020 compliance obligations. On June 21, 2023, the EPA finalized the 2023, 2024, and 2025 RVOs.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Commodity Price Risk Our earnings, cash flows, and liquidity are significantly affected by commodity price volatility. Our Revenues fluctuate with refined product prices and our Cost of revenues (excluding depreciation) fluctuates with movements in crude oil and feedstock prices.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Commodity Price Risk Our earnings, cash flows, and liquidity are significantly affected by commodity price volatility. Our Revenues fluctuate with refined product prices and our Cost of revenues (excluding depreciation) fluctuate with movements in crude oil and feedstock prices.
Based on our net open futures positions at December 31, 2023, a $1 change in the price of crude oil, assuming all other factors remain constant, would result in $6.1 million change to the fair value of our derivative instruments and Cost of revenues (excluding depreciation).
Based on our net open futures positions at December 31, 2024, a $1 change in the price of crude oil, assuming all other factors remain constant, would result in a $6.6 million change to the fair value of our derivative instruments and Cost of revenues (excluding depreciation).
Substantially all of our futures and OTC swaps are executed to economically hedge our physical commodity purchases, sales, and inventory. Our open futures and OTC swaps will expire in March 2025.
Substantially all of our futures and OTC swaps are executed to economically hedge our physical commodity purchases, sales, and inventory. Our open futures and OTC swaps will expire in December 2025.
Our predominant variable operating cost is the cost of fuel consumed in the refining process, which is included in Cost of revenues (excluding depreciation) on our consolidated statements of operations. For the year ended December 31, 2023, we consumed approximately 170 Mbpd of crude oil during the refining process across all our refineries.
Our predominant variable operating cost is the cost of fuel consumed in the refining process, which is included in Cost of revenues (excluding depreciation) on our consolidated statements of operations. For the year ended December 31, 2024, we consumed approximately 187 Mbpd of crude oil during the refining process across all our refineries.
Compliance Program Price Risk We are exposed to market risks related to the volatility in the price of RINs required to comply with the Renewable Fuel Standard. Our renewable volume obligation (“RVO”) is based on a percentage of our Hawaii, Wyoming, Washington and Montanta refineries’ production of on-road transportation fuel. The EPA sets the RVO percentages annually.
Compliance Program Price Risk We are exposed to market risks related to the volatility in the price of RINs required to comply with the Renewable Fuel Standard. Our RVO is based on a percentage of our Hawaii, Wyoming, Washington, and Montana refineries’ production of on-road transportation fuel. The EPA sets the RVO percentages annually.
An increase of 1% in the variable rate on our indebtedness, after considering the instruments subject to minimum interest rates, would result in an increase to our Cost of revenues (excluding depreciation) and Interest expense and financing costs, net of approximately $0.6 million and $7.3 million per year, respectively.
An increase of 1% in the variable rate on our indebtedness, after considering the instruments subject to minimum interest rates, would result in an increase to our Cost of revenues (excluding depreciation) and Interest expense and financing costs, net of approximately $1.7 million and $11.2 million per year, respectively.
This analysis may differ from actual results. 58 We utilize exchange-traded futures, options, and over-the-counter (“OTC”) swaps to manage commodity price risks associated with: • the price for which we sell our refined products; • the price we pay for crude oil and other feedstocks; • our crude oil and refined products inventory; and • our fuel requirements for our refineries.
We utilize exchange-traded futures, options, and over-the-counter (“OTC”) swaps to manage commodity price risks associated with: • the price for which we sell our refined products; • the price we pay for crude oil and other feedstocks; • our crude oil and refined products inventory; and • our fuel requirements for our refineries.
We may utilize interest rate swaps to manage our interest rate risk. As of December 31, 2023 we had entered into an interest rate collar at a cap of 5.50% and floor of 2.30%, based on the three month SOFR as of the fixing date. This swap expires on May 31, 2026.
We may utilize interest rate swaps to manage our interest rate risk. As of December 31, 2024, we had entered into an interest rate collar at a cap of 5.50% and floor of 2.30%, based on the three month SOFR as of the fixing date. This swap expires on May 31, 2026. Please read Note 15—Derivatives for more information.
Please read Note 15—Derivatives for more information. 59 Credit Risk We are subject to the risk of loss resulting from nonpayment or nonperformance by our counterparties. We will continue to closely monitor the creditworthiness of customers to whom we grant credit and establish credit limits in accordance with our credit policy.
Credit Risk We are subject to the risk of loss resulting from nonpayment or nonperformance by our counterparties. We will continue to closely monitor the creditworthiness of customers to whom we grant credit and establish credit limits in accordance with our credit policy.
Interest Rate Risk As of December 31, 2023, we had $665.6 million of indebtedness that was subject to floating interest rates. We also had interest rate exposure in connection with our liabilities under the J. Aron Supply and Offtake Agreement for which we pay charges based on three-month Secured Overnight Financing Rate (“SOFR”).
Interest Rate Risk As of December 31, 2024, we had $1.1 billion of indebtedness that was subject to floating interest rates. We also had interest rate exposure in connection with our liabilities under the Inventory Intermediation Agreement for which we pay charges based on the three-month Secured Overnight Financing Rate (“SOFR”).

Other PARR 10-K year-over-year comparisons