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Item 1. Business

2022-02-25 compared with 2021-03-08 · 151 added, 208 removed, 381 unchanged (49% of the section changed)

Par Pacific Holdings, Inc., headquartered in Houston, Texas, owns and operates market-leading energy and infrastructure businesses.

Our strategy is to acquire and develop energy and infrastructure businesses in logistically-complex markets.

Our strategy is to acquire and develop energy and infrastructure businesses in logistically complex, niche markets.

Our business is organized into three primary segments:

1) Refining - We own and operate four refineries, including one idled refinery, with total operating throughput capacity of over 150 Mbpd.

Our refineries in Kapolei, Hawaii, produce ultra-low sulfur diesel (“ULSD”), gasoline, jet fuel, marine fuel, low sulfur fuel oil (“LSFO”), and other associated refined products primarily for consumption in Hawaii.

We idled one of our Kapolei refineries in the first quarter of 2020 for economic reasons.

Our refinery in Newcastle, Wyoming, produces gasoline, ULSD, jet fuel, and other associated refined products that are primarily marketed in Wyoming and South Dakota.

Our refinery in Tacoma, Washington, produces distillates, gasoline, asphalt, and other associated refined products that are primarily marketed in the Pacific Northwest.

1) Refining - We own and operate three refineries with total operating crude oil throughput capacity of 154 Mbpd.

Our refinery in Kapolei, Hawaii, produces gasoline, jet fuel, ultra-low sulfur diesel (“ULSD”), marine fuel, low sulfur fuel oil (“LSFO”), and other associated refined products primarily for consumption in Hawaii.

Our refinery in Newcastle, Wyoming, produces gasoline, jet fuel, ULSD, and other associated refined products that are primarily marketed in Wyoming and South Dakota.

Our refinery in Tacoma, Washington, produces gasoline, jet fuel, ULSD, asphalt, and other associated refined products that are primarily marketed in the Pacific Northwest.

2) Retail - We operate 119 fuel retail outlets in Hawaii, Washington, and Idaho.

Our fuel retail outlets in Hawaii sell gasoline and diesel throughout the islands of Oahu, Maui, Hawaii, and Kauai.

We operate convenience stores at 34 of our Hawaii retail fuel outlets that sell merchandise such as soft drinks, prepared foods, and other sundries.

Our Hawaii retail network includes Hele and “76” branded fuel retail sites, company-operated convenience stores, 7-Eleven operated convenience stores, other sites operated by third parties, and unattended cardlock stations.

Through December 31, 2020, we rebranded 42 of our fueling stations in Hawaii to Hele (the Hawaiian word for movement or “let’s go”) and all 34 company-operated convenience stores in Hawaii to “nomnom,” a new proprietary brand.

Our retail outlets in Washington and Idaho sell gasoline, diesel, and retail merchandise and operate under the “Cenex®” and “Zip Trip®” brand names.

We began to rebrand our 33 Washington and Idaho locations during December 2020 to “nomnom” and the rebranding of four sites was completed as of December 31, 2020.

3) Logistics - We operate an extensive multi-modal logistics network spanning the Pacific, the Northwest, and the Rockies.

We operate convenience stores at 34 of our Hawaii retail fuel outlets under our proprietary “nomnom” brand that sell merchandise such as soft drinks, prepared foods, and other sundries.

Our Hawaii retail network includes Hele and “76” branded fuel retail sites, “nomnom” branded company-operated convenience stores, 7-Eleven operated convenience stores, other sites operated by third parties, and unattended cardlock stations.

Our retail outlets in Washington and Idaho sell gasoline, diesel, and retail merchandise.

Through December 31, 2021, we completed the rebranding of all 29 company-operated convenience stores in Washington and Idaho to “nomnom,” our proprietary brand.

3) Logistics - We operate an extensive multi-modal logistics network spanning the Pacific, the Northwest, and the Rocky Mountain regions.

We own and operate terminals, pipelines, a single point mooring (“SPM”), and trucking operations to distribute refined products throughout the islands of Oahu, Maui, Hawaii, Molokai, and Kauai.

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We also own a 46.0% equity investment in Laramie Energy, LLC (“Laramie Energy”), a joint venture entity focused on producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.

Impacts of the COVID-19 Pandemic

The spread and severity of a new coronavirus, referred to as COVID-19, in conjunction with government and other preventative measures taken to mitigate the spread of the virus, have caused severe disruptions in the worldwide economy, including the global demand for crude oil and refined products, the movement of people and goods in the United States, and the global supply chain for industrial and commercial production, all of which have in turn disrupted our businesses and operations and impacted our financial performance in 2020.

We continue to actively monitor the impact of the global situation on our people, operations, financial condition, liquidity, suppliers, customers, and industry, and are actively responding to the impacts that these matters have on our business.

Please read Item 1A.

— Risk Factors and Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview for further discussion of the risks, uncertainties, and actions we have taken in response to the global COVID-19 pandemic and resulting economic impact.

On January 9, 2018, we entered into an Asset Purchase Agreement with CHS Inc.

to acquire twenty-one (21) owned retail gasoline, convenience store facilities and twelve (12) leased retail gasoline, convenience store facilities at various locations in Washington and Idaho (collectively, “Northwest Retail”).

On March 23, 2018, we completed the acquisition for cash consideration of approximately $74.5 million (the “Northwest Retail Acquisition”).

The results of operations of Northwest Retail are included in our retail segment commencing March 23, 2018.

On August 29, 2018, we entered into a Topping Unit Purchase Agreement with IES Downstream, LLC (“IES”) to purchase certain of IES’s refining units and related assets in addition to certain hydrocarbon and non-hydrocarbon inventory (collectively, the “Par West Acquisition”).

On December 19, 2018, we completed the Par West Acquisition for total consideration of approximately $66.9 million, net of a $4.3 million receivable related to net working capital adjustments.

The purchase price consisted of $47.6 million in cash and approximately 1.1 million shares of our common stock with a fair value of $19.3 million.

The results of operations of the acquired assets are included in our refining segment commencing December 19, 2018.

On November 26, 2018, we entered into a Purchase and Sale Agreement to acquire U.S.

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Please read Note 22—Segment Information to our consolidated financial statements under Item 8 of this Form 10-K for detailed information on our operating results by segment.

Impacts of the COVID-19 Pandemic

The spread and severity of the coronavirus (“COVID-19”) pandemic, in conjunction with government and other preventative measures taken to mitigate the spread of the virus, have caused severe disruptions in the worldwide economy,

including the global demand for crude oil and refined products, the movement of people and goods in the United States, and the global supply chain for industrial and commercial production, all of which have in turn disrupted our businesses and operations and impacted our financial performance in 2021 and 2020.

Please read “Item 1A.

— Risk Factors” and “Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview” for further discussion of the risks, uncertainties, and actions we have taken in response to the global COVID-19 pandemic and resulting economic impact.

Corporate Information

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Our refining segment buys and refines crude oil and other feedstocks into petroleum products (such as gasoline and distillates) at our Hawaii, Wyoming, and Washington refineries.

Hawaii Refineries

Our Hawaii refineries are located in Kapolei, Hawaii, on the island of Oahu.

Our Par East refinery is rated at 94 Mbpd operating throughput capacity.

Our Par West refinery was idled in March 2020 and is currently not operational.

The Hawaii refineries’ major processing units include crude oil distillation, vacuum distillation, visbreaking, hydrocracking, naphtha hydrotreating, diesel hydrotreating, and reforming units, which produce liquified petroleum gas (“LPG”), naptha, gasoline, jet fuel, USLD, marine fuel, LSFO, high sulfur fuel oil (“HSFO”), asphalt, and other associated refined products.

We believe the configuration of our Hawaii refineries uniquely fits the demands of the Hawaii market.

As of December 31, 2020, the Hawaii

refineries consist of one operating refinery and one idle refinery with locations that are approximately two miles from one another.

Set forth below are summaries of the operating capacity of our Hawaii refineries as of December 31, 2020:

Par East and Par West Capacity (Mbpd)

Hawaii Refinery

Our Hawaii refinery is located in Kapolei, Hawaii, on the island of Oahu, and is rated at 94 Mbpd operating throughput capacity.

The Hawaii refinery’s major processing units, listed in the table below, produce liquified petroleum gas (“LPG”), naptha, gasoline, jet fuel, USLD, marine fuel, LSFO, high sulfur fuel oil (“HSFO”), asphalt, and other associated refined products.

We believe the configuration of our Hawaii refinery uniquely fits the demands of the Hawaii market.

Set forth below are summaries of the operating capacity of our Hawaii refinery as of December 31, 2021:

Hawaii Refining Unit Capacity (Mbpd)

Crude Oil Distillation Units 94

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Diesel Hydrotreater 10

Par East and Par West Capacity

Hawaii Refining Unit Capacity

Hydrogen Plant (MMcfd) 18

Co-generation Turbine Unit (MW) 20

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(1) Operating capacity of the Crude Oil Distillation Units, Vacuum Distillation Units, and Co-generation Turbine Unit excludes idled capacity of 54 Mbpd, 35 Mbpd, and 13 MW, respectively.

We source our crude oil for the Hawaii refineries from North America, Asia, Latin America, Africa, the Middle East, and other sources.

Crude oil is received into the Hawaii refineries’ tank farm, which includes 3.4 MMbbls of total owned crude oil storage and/or third-party crude oil storage.

We process the crude oil through various refining units into products and store them in the Hawaii refineries’ owned 3.3 MMbbls of refined product storage and additional third-party product storage.

We source our crude oil for the Hawaii refinery from North America, Asia, Latin America, Africa, the Middle East, and other sources.

Crude oil is received into the Hawaii refinery’s tank farm, which includes 3.4 MMbbls of total owned crude oil storage and/or third-party crude oil storage.

We process the crude oil through various refining units into products and store them in the

Hawaii refinery’s owned 3.3 MMbbls of refined product storage and additional third-party product storage.

This storage capacity allows us to manage the various product requirements of our customers.

We finance our Hawaii refineries’ hydrocarbon inventories through our Supply and Offtake Agreements with J.

We finance our Hawaii refinery’s hydrocarbon inventories through our Supply and Offtake Agreement with J.

Aron & Company LLC (“J.

Under the Supply and Offtake Agreements, J.

Aron holds title to all crude oil and refined product stored in tankage at the Hawaii refineries.

Under the Supply and Offtake Agreement, J.

Aron holds title to all crude oil and refined product stored in tankage at the Hawaii refinery.

We purchase crude oil from J.

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Aron prior to selling them to third parties.

The Par East refinery operated at an average combined crude oil throughput of 66.5 Mbpd, or 71% of crude oil utilization, to meet local demand for the year ended December 31, 2020.

Our Par West refinery was idled in March 2020 and is currently not operational.

The Hawaii refinery operated at an average combined crude oil throughput of 82.0 Mbpd, or 87% of crude oil utilization, to meet local demand for the year ended December 31, 2021.

Our Par West refinery was idled in March 2020 for economic reasons and we are evaluating alternative uses for the site.

In 2020, we executed a turnaround in Hawaii, which resulted in lower throughput and utilization outside of market conditions.

Below is a summary of our Hawaii refineries’ product yield percentages for the years ended December 31, 2020, 2019, and 2018:

Year Ended December 31,

2020 2019 2018

Combined Feedstocks Throughput (Mbpd) (1) 72.7 109.0 74.9

Par East Throughput (Mbpd) (1) 66.5 71.5 73.4

Par West Throughput (Mbpd) (1) 6.2 37.5 42.1

Yield (% of total throughput):

Gasoline and gasoline blendstocks 24.6 % 23.0 % 27.1 %

Distillates 42.2 % 44.4 % 47.4 %

Fuel oils 29.5 % 20.3 % 17.8 %

Other products (0.7) % 8.7 % 4.5 %

Total yield 95.6 % 96.4 % 96.8 %

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(1) Feedstocks throughput and sales volumes per day for each of the Hawaii refineries for the year ended December 31, 2018 are calculated based on the 365-day period we owned the Par East refinery and the 13-day period for which we owned the Par West refinery.

The amounts for the combined Hawaii refineries for the years ended December 31, 2020, 2019, and 2018 represent the sum of the Par East and Par West refineries’ throughput averaged over the respective years.

For further operational statistics regarding our Hawaii refining operations, please read “Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations.”

Our Hawaii refining business contracts with wholesale and bulk customers as well as our Hawaii retail network.

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This market reflects the closest liquid market alternative to source refined products for Hawaii.

Prior to 2020, the 4-1-2-1 Singapore crack spread (or four barrels of Brent crude oil converted into one barrel of gasoline, two barrels of distillates (diesel and jet fuel) and one barrel of fuel oil) best reflected a market indicator for our Hawaii refineries’ operations.

The 4-1-2-1 Singapore crack spread averaged $6.68 per barrel during 2019 with a low of $4.34 per barrel average in the fourth quarter and a high of $9.36 per barrel average in the third quarter.

After completing the acquisition of Par West, we began shifting our Hawaii production profile to supply the local utilities with low sulfur fuel oil and significantly reduced our high sulfur fuel oil yield.

In 2020, following the implementation of new standards by the International Marine Organization (“IMO”) beginning in 2020, we established the 3-1-2 Singapore Crack Spread (or three barrels of Brent crude oil converted into one barrel of gasoline and two barrels of distillates (diesel and jet fuel)) as a new benchmark for our Hawaii operations.

The 3-1-2 Singapore Crack Spread averaged $3.15 per barrel during the year ended December 31, 2020 with a low of $(0.14) per barrel average in the second quarter and a high of $8.11 per barrel average in the first quarter.

In 2020, we began shifting our Hawaii production profile to supply the local utilities with low sulfur fuel oil and significantly reduced our high sulfur fuel oil yield.

Following the implementation of new standards by the International Marine Organization (“IMO”) beginning in 2020, we established the 3-1-2 Singapore Crack Spread (or three barrels of Brent crude oil converted into one barrel of gasoline and two barrels of distillates (diesel and jet fuel)) as a new benchmark for our Hawaii operations.

The 3-1-2 Singapore Crack Spread averaged $6.22 per barrel during the year ended December 31, 2021 with a low of $3.80 per barrel average in the first quarter and a high of $10.49 per barrel average in the fourth quarter.

Below is a summary of average crack spreads for the years ended December 31, 2021, 2020, and 2019:

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Our Washington refinery is located in Tacoma, Washington, on approximately 139 fee-owned acres and is rated at 42 Mbpd throughput capacity.

The Washington refinery’s major processing units include crude oil distillation, vacuum, jet treating, diesel hydrotreating, isomerization, and reforming units, which produce distillates, gasoline, asphalt, and other associated refined products that are primarily marketed in the Pacific Northwest.

The Washington refinery’s major processing units include crude oil distillation, vacuum, jet treating, diesel hydrotreating, isomerization, and reforming units, which produce ULSD, jet fuel, gasoline, asphalt, and other associated refined products that are primarily marketed in the Pacific Northwest.

For further operational statistics regarding our Washington refining operations, please read “Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations.”

We source our crude oil for the Washington refinery primarily from Canadian and Bakken producers as well as other North American sources.

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MLC’s credit support can consist of either providing a payment guaranty, causing the issuance of a letter of credit from a third party issuing bank, or purchasing crude oil directly from third parties on our behalf.

Oil holds title to all crude oil and refined products inventories at all times and pledges such inventories, together with all receivables arising from the sales of same, exclusively to MLC.

Oil holds title to all crude oil and refined products inventories at all times and pledges such inventories, together with all receivables arising from the sales of these inventories, exclusively to MLC.

Set forth below is a summary of the capacity of our Washington refinery as of December 31, 2021:

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The Washington refinery operated at an average throughput of 36.3 Mbpd, or 86% utilization, for the year ended December 31, 2021.

Below is a summary of the Washington refinery’s product yield percentages for the year ended December 31, 2020 and the period from January 11, 2019 (the date of acquisition) to December 31, 2019:

Year Ended December 31, 2020 January 11, 2019 to December 31, 2019

Feedstocks Throughput (Mbpd) 39.1 38.9

Yield (% of total throughput)

Gasoline and gasoline blendstocks 23.4 % 23.6 %

Distillates 35.3 % 35.6 %

Asphalt 18.8 % 18.9 %

Other products 19.8 % 19.4 %

Total yield 97.3 % 97.5 %

In 2021, we executed the first phase of a turnaround in Washington, which resulted in lower throughput and utilization outside of market conditions.

Our Washington refining business transports crude oil and refined products through our logistics network and sells refined products to wholesale, bulk, and retail customers primarily in the Pacific Northwest.

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The Pacific Northwest 5-2-2-1 Index is computed by taking two parts gasoline (sub-octane), two parts middle distillates (ULSD and jet fuel), and one part fuel oil as created from five barrels of Alaskan North Slope (“ANS”) crude oil.

The Pacific Northwest 5-2-2-1 Index averaged $11.44 per barrel during the year ended December 31, 2020 with a low of $9.39 per barrel average in the third quarter and a high of $13.24 per barrel average in the first quarter.

Below is a summary of average crack spreads for the year ended December 31, 2020 and the period from January 11, 2019 (the date of acquisition) to December 31, 2019:

Year Ended December 31, 2020 January 11, 2019 to December 31, 2019

The Pacific Northwest 5-2-2-1 Index averaged $15.95 per barrel during the year ended December 31, 2021 with a low of $11.46 per barrel average in the first quarter and a high of $18.59 per barrel average in the third quarter.

Below is a summary of average crack spreads and crude oil prices per barrel for the years ended December 31, 2021, 2020, and 2019:

Year Ended December 31,

2021 2020 2019

Pacific Northwest 5-2-2-1 Index (1)

$ 15.95 $ 11.44 $ 15.02

Bakken Clearbrook $ 68.20 $ 37.19 $ 56.04

WCS Hardisty $ 54.61 $ 27.45 $ 43.18

ANS $ 71.49 $ 41.77 $ 65.72

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(1) The 2019 prices for the year ended December 31, 2019 represent the price averaged over the period from January 11, 2019 to December 31, 2019.

Wyoming Refinery

Our Wyoming refinery is located in Newcastle, Wyoming, on approximately 121 fee-owned acres and is rated at 18 Mbpd throughput capacity.

Our Wyoming refinery is located in Newcastle, Wyoming, on approximately 121 fee-owned acres and with a capacity of 18 Mbpd throughput.

The Wyoming refinery’s major processing units include crude oil distillation, catalytic cracker, naphtha hydrotreating, and reforming units, which produce gasoline, ULSD, jet fuel, and other associated refined products.

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Crude oil is received into the refinery tank farm and crude oil terminals, which include 267 Mbbls of total crude oil storage.

We process the crude oil through various refining units into products and store them in the Wyoming refinery’s 513 Mbbls of refined product tankage.

We process the crude oil through various refining units into products and store them in the Wyoming refinery’s 513

Mbbls of refined product tankage.

The Wyoming refinery’s storage capacity allows us to manage the various product requirements of our customers in the states of Wyoming and South Dakota and other targeted market destinations.

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In 2020, we executed a turnaround in Wyoming, which resulted in lower throughput and utilization outside of market conditions.

Below is a summary of the Wyoming refinery’s product yield percentages for the years ended December 31, 2020, 2019, and 2018:

Year Ended December 31,

2020 2019 2018

Feedstocks Throughput (Mbpd) 12.3 17.0 16.4

Yield (% of total throughput):

Gasoline and gasoline blendstocks 49.2 % 49.6 % 49.5 %

Distillates 45.2 % 44.5 % 45.8 %

Fuel oil 1.9 % 1.7 % 1.6 %

Other products 1.3 % 1.6 % 0.8 %

Total yield 97.6 % 97.4 % 97.7 %

For further operational statistics regarding our Wyoming refining operations, please read “Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations.”

Our Wyoming refining business transports refined products through our logistics network to wholesale, bulk, and retail customers primarily in Wyoming and South Dakota.

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We believe the Wyoming 3-2-1 crack spread, a 50%/50% blend of Rapid City 3-2-1 and Denver 3-2-1 (WTI based) crack spreads, best reflects a market indicator for our Wyoming refining and fuel distribution operations.

The Wyoming 3-2-1 Index, or three barrels of WTI converted into two barrels of gasoline and one barrel of distillates (jet fuel and diesel), averaged

$17.80 per barrel during 2020 with a low of $15.86 per barrel average in the first quarter and a high of $20.24 per barrel average in the third quarter.

The Wyoming 3-2-1 Index, or three barrels of WTI converted into two barrels of gasoline and one barrel of distillates (jet fuel and diesel), averaged $29.00 per barrel during 2021 with a low of $20.97 per barrel average in the first quarter and a high of $41.78 per barrel average in the third quarter.

Below is a summary of average crack spreads for the years ended December 31, 2021, 2020, and 2019:

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Our refining business sources and obtains all of our crude oil from third-party sources and competes globally for crude oil and feedstocks.

Our Hawaii refineries, through our facility with J.

Aron, have access to a large variety of markets for crude oil imports and product exports.

Please read “Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Commitments and Contingencies — Supply and Offtake Agreements” of this Form 10-K for further information.

Our Hawaii refinery, through our facility with J.

Aron, has access to a large variety of markets for crude oil imports and product exports.

Please read Note 11—Inventory Financing Agreements to our consolidated financial statements under Item 8 of this Form 10-K for further information.

Our Washington refinery utilizes an intermediation arrangement with MLC and sources its crude oil and feedstocks primarily from North Dakota and Canada.

Please read “Item 7.

— Management’s Discussion and Analysis of Financial Condition and Results of Operations — Commitments and Contingencies — Washington Refinery Intermediation Agreement” of this Annual Report on Form 10-K for further information.

Please read Note 11—Inventory Financing Agreements to our consolidated financial statements under Item 8 of this Form 10-K for further information.

Our Wyoming refinery sources its crude oil and feedstocks primarily from the Petroleum Administration for Defense District IV Rocky Mountain (“PADD IV”) region of the United States.

Our Hawaii refineries’ product slate is tailored to meet local on-island demand.

Outside the Hawaii market, our refined product sales from our Hawaii refineries typically target the U.S.

Our Hawaii refinery’s product slate is tailored to meet local on-island demand.

Outside the Hawaii market, our refined product sales from our Hawaii refinery typically target the U.S.

West Coast market.

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The retail segment includes 90 locations in Hawaii and 29 locations in Washington and Idaho where we set the price to the retail consumer.

Of these, 34 of the Hawaii locations and all 33 Washington and Idaho locations are operated by our personnel and include various sizes of kiosks, snack shops, or convenience stores.

Of these, 34 of the Hawaii locations and all 29 Washington and Idaho locations are operated by our personnel and include various sizes of convenience stores, snack shops, and kiosks.

The remaining 56 Hawaii locations are cardlocks or sites operated by third parties where we retain ownership of the fuel and set retail pricing.

We hold exclusive licenses within the state of Hawaii to utilize the “76” brand for retail locations, with 40 of our retail sites branded “76”.

The “76” license agreement expires September 24, 2024, unless extended by mutual agreement.

The “76” license agreement expires October 31, 2031, unless extended by mutual agreement.

An additional 42 of our sites operate under our proprietary Hele fuel brand.

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Our eight cardlock locations on Kauai are branded Kauai Automated Fuels (“KAF”).

Through December 31, 2020, we completed the rebranding of all of our 34 company-operated convenience stores in Hawaii to “nomnom,” a new proprietary brand.

As of December 31, 2020, most of our retail outlets in Washington and Idaho continued to operate under the “Cenex®” and “Zip Trip®” brand names.

A rebranding of those sites to our proprietary “nomnom” brand began in December 2020 and the rebranding of four sites was completed as of December 31, 2020.

As part of the Northwest Retail Acquisition, Par and CHS, Inc.

entered into a multi-year branded petroleum marketing agreement for the continued supply of Cenex®-branded refined products to the 33 acquired Cenex® Zip Trip convenience stores.

As these stores are rebranded, Par will begin self-supplying the fuel with equity barrels and/or unbranded fuels procured in the open market.

The following table shows our owned and leased retail outlets by location and type as of December 31, 2020:

Location and Channel of Trade “76” Brand Hele Brand KAF Cenex® Zip Trip Brand

Company operated 2 18 — — — 20

7-Eleven alliance 22 8 — — — 30

Fee operated 5 2 — — — 7

Cardlock — 4 — — — 4

Oahu total 29 32 — — — 61

Company operated 3 6 — — — 9

Fee operated 3 — — — — 3

Big Island total 6 6 — — — 12

Company operated 1 4 — — — 5

Fee operated 1 — — — — 1

Maui total 2 4 — — — 6

Fee operated 3 — — — — 3

Cardlock — — 8 — — 8

Kauai total 3 — 8 — — 11

Total for Hawaii locations 40 42 8 — — 90

Company operated — — — 21 4 25

Washington total — — — 21 4 25

Company operated — — — 8 — 8

Idaho total — — — 8 — 8

Total for Pacific Northwest locations — — — 29 4 33

Total for retail segment 40 42 8 29 4 123

All 34 company-operated convenience stores in Hawaii are branded “nomnom,” our proprietary brand.

We operate convenience stores at all 29 of our retail fuel outlets in Washington and Idaho.

As part of our 2018 acquisition of these retail outlets, we entered into a multi-year branded petroleum marketing agreement for the continued supply of Cenex®-branded refined products to the acquired Cenex® Zip Trip convenience stores.

As of December 31, 2021, we had completed the rebranding of all of our retail outlets in Washington and Idaho from the “Cenex®” and “Zip Trip®” brand names to our proprietary “nomnom” brand.

As these stores were rebranded, we began self-supplying the fuel with equity barrels and/or unbranded fuels procured in the open market.

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.

Competitors of our Northwest Retail assets include the Chevron, Exxon, Conoco, Safeway, and Costco national brands, regional brands such as Maverik, Holiday, and Fred Meyer, and other local retail brands.

Competitors of our Pacific Northwest retail assets include the Chevron, Exxon, Conoco, Safeway, and Costco national brands, regional brands such as Maverik, Holiday, and Fred Meyer, and other local retail brands.

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.

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Our logistics network extends throughout the state of Hawaii.

On Oahu, the system begins with our SPM located 1.7 miles offshore of our Par East refinery.

This SPM allows for the safe, reliable, and efficient receipt of crude oil shipments to the Hawaii refineries, as well as both the receipt and export of finished products.

Connecting the SPM to the Hawaii refineries are three undersea pipelines:

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.

Connecting the SPM to the Hawaii refinery are three undersea pipelines:

a 30-inch line for crude oil, a 20-inch line, and a 16-inch line, both for the import or export of refined products.

From the Hawaii refineries’ gates, we distribute refined products through our logistics network throughout the islands of Oahu, Maui, Hawaii, Molokai, and Kauai and for export to the U.S.

We also have an on-shore pipeline manifold which allows for crude oil to be transferred from an undersea pipeline owned by IES Downstream, LLC (“IES”) to the SPM and from the SPM to the Hawaii refinery.

From the Hawaii refinery’s gates, we distribute refined products through our logistics network throughout the islands of Oahu, Maui, Hawaii, Molokai, and Kauai and for export to the U.S.

West Coast and Asia.

The Oahu logistics network includes a 27-mile wholly owned and operated pipeline network that transports refined products from our Hawaii refineries to delivery locations.

The Oahu logistics network includes a 27-mile wholly owned and operated pipeline network that transports refined products from our Hawaii refinery to delivery locations.

The majority of our Oahu refined product volumes are distributed through a multi-product pipeline (the “Honolulu Products Pipeline”) to (i) our leased and operated Sand Island terminal, (ii) the Honolulu International Airport, (iii) interconnections to Navy and Air Force fuel facilities, and (iv) two third-party terminals in Honolulu Harbor.

In addition to the Honolulu Products Pipeline, we own four proprietary pipelines connecting our Hawaii refineries to Kalaeloa Barbers Point Harbor, approximately three miles from the Par East refinery.

In addition to the Honolulu Products Pipeline, we own four proprietary pipelines connecting our Hawaii refinery to Kalaeloa Barbers Point Harbor, approximately three miles from the Hawaii refinery.

The four pipelines deliver refined products to barges for distribution to the neighboring islands or export, the local utility pipeline and storage network, and another third-party terminal on the west side of Oahu.

The Oahu pipeline network is generally configured to be bidirectional, allowing for both delivery and receipt of products.

In connection with the Par West Acquisition, we entered into a long-term agreement with IES for storage and throughput at the Par West Hawaii refinery.

The agreement provides for the right to utilize 2 MMbbls of dedicated crude oil and refined product storage, as well as certain IES logistics assets, including its off-shore mooring and Honolulu pipeline system.

During the first half of 2019, crude oil was transferred to the Par West Hawaii refinery via the IES off-shore mooring and a 30-inch undersea pipeline.

During the third quarter of 2019, we completed an on-shore pipeline manifold that connects the IES pipeline to our owned SPM pipeline (the “Tie-In”).

The Tie-In allows crude oil to be transferred from our SPM to the Par East and Par West Hawaii refineries.

Our terminal facilities on Oahu include our Sand Island facility that comprises two tanks with a total capacity of 30 Mbbls, as well as contractual rights to utilize strategically located third-party facilities both near the Hawaii refineries and at Honolulu Harbor.

We also operate a proprietary trucking business on Oahu to distribute gasoline and road diesel to the final point of sale.

We have a long-term agreement with IES for storage and throughput at the Hawaii refinery which provides for the right to utilize 2 MMbbls of dedicated crude oil and refined product storage, as well as certain IES logistics assets, including its off-shore mooring and Honolulu pipeline system.

Our terminal facilities on Oahu include our Sand Island facility that

comprises two tanks with a total capacity of 30 Mbbls, as well as contractual rights to utilize strategically located third-party facilities both near the Hawaii refinery and at Honolulu Harbor.

Our logistics network for the islands neighboring Oahu consists of leased barge equipment, refined product tankage, and proprietary trucking operations on the islands of Maui, Hawaii, Molokai, and Kauai.

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Washington Logistics

Our Washington logistics network includes 2.8 MMbbls of storage capacity, a proprietary 14-mile jet fuel pipeline that serves Joint Base Lewis McChord, a marine terminal with 15 acres of waterfront property, a unit train-capable rail loading terminal with 107 unloading spots, a manifest rail siding with 32 spots including an Asphalt, Butane, and Biodiesel loading and unloading facilities, and a truck rack with six truck lanes and 10 loading arms.

Our Washington logistics network includes 2.8 MMbbls of storage capacity, a proprietary 14-mile jet fuel pipeline that serves Joint Base Lewis McChord, a marine terminal with 15 acres of waterfront property, a unit train-capable rail loading terminal with 107 unloading spots, a manifest rail siding with 32 spots including asphalt, butane, and biodiesel loading and unloading facilities, and a truck rack with six truck lanes and 10 loading arms.

These assets provide connectivity to Bakken, Canadian, and Alaskan crude oil, renewable fuels, and the Pacific, West Coast, Pacific Northwest, and Rockies product markets.

Wyoming Logistics

Our Wyoming logistics network includes a 98-mile crude oil pipeline gathering system that provides us access to crude oil from the Powder River Basin.

Our Wyoming logistics network includes 190 Mbbls of crude storage tank capacity and a 50-mile crude oil pipeline that provides us access to crude oil from the Powder River Basin.

This network also includes a 40-mile refined products pipeline that transports product from our Wyoming refinery to a common carrier with access to Rapid City, South Dakota.

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Hawaii Market

The COVID-19 pandemic had a significant impact on Hawaii’s communities and economy in 2020 and state economists are predicting a slow but steady multi-year road to recovery.

Beginning with a mandatory 14-day quarantine period for arriving visitors in March 2020, visitor arrivals plummeted by more than 90% from the previous year.

Restrictions on travel, business closures, and strict limits on in-person gatherings severely curtailed demand for jet and other fuels and stymied the economy.

After beginning 2020 at 2.6% unemployment, the average unemployment rate in Hawaii increased to an average of 15.1% from April through December 2020, when Hawaii lost 110,600 non-agricultural payroll jobs compared with the same period a year earlier, according to the Hawaii Department of Business, Economic Development and Tourism (“DBEDT”), and every sector lost jobs except for the construction industry and federal government.

The unemployment rate has since decreased to 10.3% in December 2020, according to the U.S.

Bureau of Labor Statistics.

According to the University of Hawaii Economic Research Organization’s (“UHERO”) December 2020 report, the start of mass vaccinations in Hawaii will improve growth prospects for the second half of 2021.

In the fall of 2020, the State of Hawaii instituted the Safe Travels program, requiring all transpacific travelers to secure a negative COVID-19 test prior to arriving on the islands, allowing the visitor industry to welcome travelers back beginning in mid-October 2020.

Visitor arrivals in November 2020, the first full month of the Safe Travelers program, increased to less than one quarter of their level in November 2019 and employment in the leisure and hospitality industry is about half of its pre-pandemic level, according to UHERO.

Economists and lawmakers remain optimistic that an increased rollout of vaccinations, a proliferation of testing for residents and transpacific arrivals, and stimulus measures enacted by state and federal lawmakers will put Hawaii on a course to recovery, with gradual gains becoming visible as tourist activity resumes.

The COVID-19 pandemic continued to have an impact on Hawaii’s communities and economy in 2021.

In the summer of 2021, however, there was a strong rebound in domestic tourists visiting Hawaii.

Through the Hawaii Safe Travels program, visitors were able to provide proof of vaccination or a negative COVID-19 test to avoid the 14-day quarantine period.

Restrictions that were in place in 2020 on travel, business closures, and in-person gatherings began to be lifted, which allowed for the beginning of an economic recovery.

While domestic tourism has been near or at pre-pandemic levels since the summer of 2021, international tourism has yet to return.

State economists expect a slow but steady multi-year road to recovery.

According to the University of Hawaii Economic Research Organization’s (“UHERO”) fourth quarter 2021 report, unemployment dropped from 11.8% at the end of 2020 to 7.7% at the end of 2021, which is still well above Hawaii’s pre-pandemic level of 2.6%.

Many workers who left the labor force during the pandemic have yet to return.

This has led to a tight labor market and upward pressure on wages.

Unit labor costs increased by 5% year-over-year nationally and inflation increased by more than 5% in both Hawaii and the U.S., reducing purchasing power.

While the payroll job count is expected to expand at a moderate pace over the next two years, the job base in 2023 is expected to be about 5% lower than its 2019 level.

The emergence of the Omicron variant in late 2021 presented additional uncertainty.

Renewed international travel restrictions have reduced the near-term visitor outlook.

Once the situation eases, the return of international tourists is expected to permit a broader industry recovery in 2022.

Moderate job gains are expected heading into 2022, but several factors will weigh on progress, including continuing labor shortages, the end of pandemic fiscal and monetary support, and higher inflation.

Despite the challenges mentioned above, we expect our business to continue to recover in 2022.

Pacific Northwest and Rockies 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.

Census Bureau projected that the population increased 13.2% in Washington and 14.0% in Idaho from 2010 to 2019 versus a national increase of only 6.3%.

Spokane is a regional hub in eastern Washington, with a population of over a half million and a variety of employers in the health care, retail, and other industries.

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.

According to the U.S.

Bureau of Economic Analysis (the “BEA”), personal income for the Spokane metro area grew by 13.4% between 2018 and 2020, continuing the trend of positive growth since the 2008-2009 recession.

Additionally, Amazon.com, Inc.

opened a new fulfillment center near the Spokane International Airport in June 2020 and future regional growth and increased traffic is expected.

A significant portion of the products produced by our Washington refinery stay within the Puget Sound region.

Washington is one of the fastest growing states in the union and most of this growth is occurring in the Puget Sound area due to large information industry companies like Microsoft Corporation, Amazon.com, Inc., and Expedia Group, Inc.

According to the BEA, gross domestic product (“GDP”) for Washington state grew by 3.1% from 2018 to 2019, leading the Far West states and ranking third nationally.

According to the BEA, personal income in Puget Sound’s four largest counties grew on average 6.3% between 2017 and 2018 and personal income in the State of Washington grew an average 6.4% and ranked second nationally for the first three quarters of 2019.

The Puget Sound region represents approximately 69% of the Washington state population.

According to the BEA, gross domestic product (“GDP”) for the State of Washington grew by 6.3% from 2019 to 2020.

The primary market for our Wyoming refined products is the Black Hills Region in South Dakota, driven largely by Pennington, Lawrence, and Meade counties, which represents nearly half of the state’s taxable tourism sales.

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According to the BEA, personal income in South Dakota grew by 8.7% from 2019 to 2020.

Unemployment in South Dakota continues to remain below the national average unemployment rate at 3.3% for December 2020, according to the U.S.

Bureau of Labor Statistics.

Additionally, the South Dakota economy expects to get a boost from additional development at Ellsworth Air Force Base as the main operating base for the B-21 Raider and the home for the training unit and an operational squadron.

Demand for gasoline is highly seasonal, with a large increase in demand during the summer driving season.

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, despite limitations to mobility and economic disruption caused by the COVID-19 pandemic, South Dakota welcomed 12.6 million visitors, a 12.9% decrease as compared to 2019, resulting in visitor spending of approximately $3.4 billion in 2020, a decrease of 17.9% over 2019.

In 2020, $644 million,

or 19%, of tourism dollars were spent on transportation services, a decrease of 32% from 2019, when $941 million, or 23%, of tourism dollars were spent on transportation services.

According to the South Dakota Department of Tourism, despite limitations on mobility and economic disruption caused by the COVID-19 pandemic, South Dakota welcomed 13.5 million visitors in 2021, a 26.0% increase as compared to 2020, resulting in visitor spending of approximately $4.4 billion in 2021, an increase of 29.7% over 2020.

In 2021, $832 million, or 19.1%, of tourism dollars were spent on transportation services, an increase of 29% from 2020, when $644 million, or 19.2%, of tourism dollars were spent on transportation services.

We also distribute refined products to customers in central and northeastern Wyoming.

The economy in Wyoming is sensitive to demand for Powder River Basin coal and other locally-produced commodities.

Coal production increased 8% in 2021 and the U.S.

Energy Information Administration forecasts that coal production will increase in both 2022 and 2023.

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Laramie Energy

As of December 31, 2020, we own a 46.0% equity investment in Laramie Energy, a joint venture entity focused on producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.

As of December 31, 2021, we owned a 46.0% equity investment in Laramie Energy, a joint venture entity focused on producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado.

We have discontinued the application of the equity method of accounting for our investment in Laramie Energy because the book value of such investment has been reduced to zero.

Our equity investment in Laramie Energy and the reserves we own indirectly through Laramie Energy are not material to our consolidated financial statements as of December 31, 2020.

Laramie Energy’s oil and gas producing activities are not material to our business operations or financial position.

Our investment in Laramie Energy is not material to our consolidated financial statements as of December 31, 2021.

BANKRUPTCY AND PLAN OF REORGANIZATION

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Government for approximately $22.4 million relating to ongoing litigation concerning a plugging and abandonment obligation in Pacific Outer Continental Shelf Lease OCS-P 0320, comprising part of the Sword Unit in the Santa Barbara Channel, California.

The second unliquidated claim, which is related to the same plugging and abandonment obligation, was filed by Noble Energy Inc., the operator and majority interest owner of the Sword Unit.

The second unliquidated claim, which is related to the same plugging and abandonment

obligation, was filed by Noble Energy Inc., the operator and majority interest owner of the Sword Unit.

We believe the probability of issuing shares to satisfy the full claim amount is remote, as the obligations upon which such proof of claim is asserted are joint and several among all working interest owners and Delta, our predecessor, owned an approximate 3.4% aggregate working interest in the unit.

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We have accrued approximately $0.5 million representing the estimated value of claims remaining to be settled which are deemed probable and estimable at December 31, 2021.

Please read “Item 7.

– Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Commitments and Contingencies – Bankruptcy Matters” of this Form 10-K for further information.

Closing of the Bankruptcy Cases

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Reports are being made in connection with our refining business.

Sources subject to these reporting requirements also include on and offshore petroleum and natural gas production and onshore natural gas processing and distribution facilities that emit 25,000 metric tons or more of CO 2 equivalent per year in aggregate emissions from all site sources.

Sources subject to these reporting requirements also include on and offshore petroleum

and natural gas production and onshore natural gas processing and distribution facilities that emit 25,000 metric tons or more of CO 2 equivalent per year in aggregate emissions from all site sources.

In 2007, the State of Hawaii passed Act 234, which required that GHG emissions be rolled back on a statewide basis to 1990 levels by the year 2020.

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The GHG rules include an alternative for facilities to demonstrate that further GHG reductions are not economically viable and an additional provision that authorized the DOH to issue a waiver if GHGs are being effectively controlled as a consequence of other state initiatives and regulations such as the Renewable Portfolio Standard.

The Hawaii refineries’ capacity to materially reduce fuel use and GHG emissions is limited because most energy conservation measures have already been implemented over the past 20 years.

Hawaii’s regulation allows for “partnering” with other facilities (principally power plants) that have already dramatically reduced GHG emissions or are on schedule to reduce CO 2 emissions in order to comply with the state’s Renewable Portfolio Standards.

Accordingly, our Hawaii refineries submitted a GHG reduction plan that incorporates the partnering provisions and demonstrates that additional reductions are not cost-effective or necessary because of the Hawaii refineries’ shared baseline allocation and because the State of Hawaii has already reached the 1990 levels according to a report prepared by the DOH in January 2019.

The Hawaii GHG regulation allows for “partnering” with other facilities that have or are expected to make more significant CO 2 /GHG reductions.

Accordingly, our Par East and Par West Hawaii refineries submitted a GHG reduction plan and a permit application that incorporated the partnering provisions.

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.

In 2020, the year in which operation of the Par West crude unit was suspended, both refineries reported a combined GHG emission total of 619,609 metric tons (which is 32% below the Title V permit limit).

Consequently no additional operating constraints nor capital for modifications will be required to comply with the State’s current GHG regulation.

In addition to the Hawaii GHG legislation, the State of Washington and its political subdivisions have passed several climate-focused laws in 2021 that are relevant to our Tacoma, Washington location.

These include a low-carbon fuel standard designed to reduce the carbon intensity of transportation fuels by twenty percent by 2038 and a “cap and trade”-style program for GHG emissions covering industrial facilities starting in 2023.

As both legislative programs are presently undergoing rulemaking processes at the Washington Department of Ecology, the contours of both sets of requirements are not yet clear.

In addition to action by the State, on November 16, 2021, the Tacoma City Council adopted its Tideflats and Industrial Land Use Regulations, which prohibits new petroleum storage and allows for only limited additions of clean fuel infrastructure.

Further regulatory, legislative, and judicial developments are likely to occur in the future.

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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.

Thus far, Hawaii air quality, particularly on Oahu where our Hawaii refineries are located, has met even the most recent NAAQS and the Hawaii refineries have not been required to install new controls as result of local rules.

Thus far, Hawaii air quality, particularly on Oahu where our Hawaii refinery is located, has met even the most recent NAAQS and the Hawaii refinery has not been required to install new controls as result of local rules.

Even so, NAAQS could and, to a degree, have already forced some changes for our customer base.

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These rules are causing many areas of the country to develop requirements for additional controls and limits on combustion emissions and emissions of volatile organic compounds.

We do not currently anticipate that the more stringent NAAQS will materially impact our Hawaii, Washington, or Wyoming operations.

In October 2021, EPA announced that it intends to revisit the December 2020 decision to retain the 2015 NAAQS standard, opening the door to potential additional tightening of those standards and additional requirements for states around the country to adopt more stringent controls.

We do not currently anticipate that the more stringent NAAQS will materially impact our Hawaii, Washington, or Wyoming operations, but the risk of impact will increase in Washington as the standard is lowered.

Fuel Standards

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by model year 2020 and contained an expanded Renewable Fuel Standard (the “RFS”).

In August 2012, the EPA and National Highway Traffic Safety Administration (“NHTSA”) jointly adopted regulations that establish vehicle carbon dioxide emissions standards and an average industry fuel economy of 54.5 miles per gallon by model year 2025.

In August 2012, the EPA and National Highway Traffic Safety Administration (“NHTSA”) jointly adopted regulations that establish vehicle carbon dioxide emissions standards

and an average industry fuel economy of 54.5 miles per gallon by model year 2025.

On August 8, 2018, the EPA and NHTSA jointly proposed to revise existing fuel economy standards for model years 2021-2025 and to set standards for 2026 for the first time.

On March 31, 2020, the agencies released updated fuel economy and vehicle emissions standards, which provide for an increase in stringency by 1.5% each year through model year 2026, as compared with the standards issued in 2012 that required 5% annual increases.

On December 30, 2021, the EPA and NHTSA published a final rule containing additional fuel efficiency standards for cars and light trucks that include 5-10% reductions of GHG emissions annually through model year 2026.

Higher fuel economy standards have the potential to reduce demand for our refined transportation fuel products.

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To the extent that we exceed the minimum volumetric requirements for blending of renewable fuels, we can retain these RINs for current or future RFS compliance or sell those on the open market.

EPA has not yet set volumetric requirements for 2021, which makes it difficult to estimate our obligations.

On December 21, 2021, the EPA published proposed RFS that include retroactive cuts to earlier 2020 quotas, set 2021 targets at levels of renewable fuels that were actually used, and would establish significantly higher volume requirements for 2022.

Whether that rule will be finalized as proposed and how the final rule will fare in the courts may significantly alter our obligations to blend renewable fuels or purchase RINs.

The RFS may present production and logistics challenges for both the renewable fuels and 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.

In October 2010, the EPA issued a partial waiver decision under the federal CAA to allow for an increase in the amount of ethanol permitted to be blended into gasoline from 10% (“E10”) to 15% (“E15”) for 2007 and newer light duty motor vehicles.

In 2019, the EPA approved year-round sales of E15.

In 2019, the EPA approved year-round sales of E15 but that approval has been overturned by the courts and, as of January 10, 2022, the Supreme Court has declined to review further appeals on that subject.

There are numerous issues, including state and federal regulatory issues, that need to be addressed before E15 can be marketed on a large scale for use in traditional gasoline engines;

however, increased renewable fuel in the nation’s transportation fuel supply could reduce demand for our refined products.

In March 2014, the EPA published a final Tier 3 gasoline standard that requires, among other things, that gasoline contain no more than 10 parts per million (“ppm”) sulfur on an annual average basis and no more than 80 ppm sulfur on a per-

gallon basis.

The standard also lowers the allowable benzene, aromatics, and olefins content of gasoline.

The effective date for the new standard was January 1, 2017, however, approved small volume refineries had until January 1, 2020 to meet the standard.

The Par East Hawaii refinery was required to comply with Tier 3 gasoline standards within 30 months of June 21, 2016, the date it was disqualified from small volume refinery status.

The Hawaii refinery was required to comply with Tier 3 gasoline standards within 30 months of June 21, 2016, the date it was disqualified from small volume refinery status.

On March 19, 2015, the EPA confirmed the small refinery status of our Wyoming refinery.

The Par East Hawaii refinery, our Wyoming refinery, and our Washington refinery, acquired in January 2019, were all granted extensions of small refinery exemptions by the EPA for 2018.

The Hawaii refinery, our Wyoming refinery, and our Washington refinery, acquired in January 2019, were all granted extensions of small refinery exemptions by the EPA for 2018.

All our refineries are Tier 3 compliant.

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coastline (which includes the entire Hawaiian Island chain) were lowered from 10,000 ppm (1%) to 1,000 ppm (0.1%).

The sulfur standards began at the Hawaii refineries and were phased in so that by January 1, 2015, they were fully aligned with the IMO standards and deadline.

The sulfur standards began at the Hawaii refinery and were phased in so that by January 1, 2015, they were fully aligned with the IMO standards and deadline.

The more stringent standards apply universally to both U.S.

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Beyond the 200 mile ECA, large ocean vessels are still allowed to burn marine fuel with up to 3.5% sulfur.

Our Hawaii refineries are capable of producing the 1% sulfur residual fuel oil that was previously required within the ECA.

Although our Hawaii refineries remain in a position to supply vessels traveling to and through Hawaii, the market for 0.1% sulfur distillate fuel and 3.5% sulfur residual fuel is much more competitive.

Our Hawaii refinery is capable of producing the 1% sulfur residual fuel oil that was previously required within the ECA.

Although our Hawaii refinery remains in a position to supply vessels traveling to and through Hawaii, the market for 0.1% sulfur distillate fuel and 3.5% sulfur residual fuel is much more competitive.

In addition to U.S.

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These laws and regulations may require the acquisition of a permit or other authorization before drilling or construction related to the oil and gas industry commences and may limit or prohibit construction, drilling, and other activities on certain lands lying within wilderness or wetlands and other protected areas and impose substantial liabilities for pollution resulting from our operations.

For example, the Magnuson amendment to the Marine Mammal Protection Act may limit or restrict certain new oil terminals and oil-by-rail infrastructure in the state of Washington.

For example, the Magnuson amendment to the

Marine Mammal Protection Act may limit or restrict certain new oil terminals and oil-by-rail infrastructure in the state of Washington.

State laws further regulate discharges of pollutants to surface and groundwaters, require permits that set limits on discharges to such waters, and provide civil and criminal penalties and liabilities for spills to both surface and groundwaters.

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As these new positions limit rules are not yet final, the impact of those provisions on us is uncertain at this time.

It is possible that the CFTC, in conjunction with prudential regulators, may mandate that financial counterparties entering into swap transactions with end users must do so with credit support agreements in place, which could result in negotiated credit thresholds above which an end user must post collateral.

negotiated credit thresholds above which an end user must post collateral.

If this should occur, we intend to manage our credit relationships to minimize collateral requirements.

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The majority of our refined products are primarily sold through short-term contracts or on the spot market.

For the year ended December 31, 2020, we had one customer in our refining segment that accounted for 13% of our consolidated revenue.

For each of the years ended December 31, 2021 and 2020, we had one customer in our refining segment that accounted for 13% of our consolidated revenue.

No other customer accounted for more than 10% of our consolidated revenues during the years ended December 31, 2021, 2020, and 2019.

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By investing in our employees, we are able to achieve success and continue to execute on our mission and vision.

At December 31, 2020, our workforce consisted of 1,403 employees, including 243 employees, or 17% of our total workforce, at our Hawaii and Washington refineries represented by the United Steelworkers Union (“USW”) with collective bargaining agreements expiring on January 31, 2022.

At December 31, 2021, our workforce consisted of 1,336 employees, including 226 employees, or 17% of our total workforce, at our Hawaii and Washington refineries represented by the United Steelworkers Union (“USW”) with collective bargaining agreements which expired on January 31, 2022 and are currently subject to automatic extension periods while the parties continue negotiations.

We value all our employees, represented and non-represented, and constantly strive to maintain and improve satisfactory relationships with them.

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We are developing relationships with local organizations that provide services to historically underserved populations and make them aware of career opportunities at Par.

As of December 31, 2020, our workforce consists of 50% minorities and 5% protected veterans.

As of December 31, 2021, our workforce consisted of 49% minorities and 6% protected veterans.

Culture and Values

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We value the unique heritage, experiences, and contributions of everyone we get to work with and serve.

Our commitment to doing the good and right thing with the highest ethical standards helps us to achieve our best results.

Our commitment to doing

the good and right thing with the highest ethical standards helps 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.

We offer highly competitive compensation, benefit, and time-off packages to promote employee fulfillment and work-life balance.

Our benefits include our employee stock purchase plan, generous time off allowance, and a tuition reimbursement program.

We offer highly competitive compensation, be nefit, and time-off packages to promote employee fulfillment and work-life balance.

Our benefits include our employee stock purchase plan, extensive health and wellness benefits, generous time off allowance, and a tuition reimbursement program.

Health and Safety

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We continually monitor the implementation of programs, policy, and procedures to achieve this objective.

The importance of quick action and continuous monitoring was made clear by the COVID-19 pandemic.

Our leaders took and continue to take swift action to protect employees, contractors, and customers and to ensure operations in each segment of our business are able to continue without interruption.

For example, our retail stores have installed plexiglass shields designed to limit employee exposure to viruses and our administrative offices have implemented alternative work schedules to reduce capacity and allow for social distancing.

Our actions demonstrate that we live our values every day.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Annual Report on Form 10-K may constitute “forward-looking” statements as defined in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Private Securities Litigation Reform Act of 1995 (“PSLRA”), or in releases made

by the SEC, all as may be amended from time to time.

Such forward-looking statements involve known and unknown risks, uncertainties, and other important factors that could cause our actual results, performance, or achievements to differ materially from any future results, performance, or achievements expressed or implied by such forward-looking statements.

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Due to the unpredictable and unprecedented nature of the COVID-19 pandemic, we cannot identify all potential risks to, and impacts on, our business, including the ultimate adverse economic impact to the Company’s business, results of operations, financial condition, and liquidity.

However, the adverse impact of COVID-19 on the Company has been and will likely continue to be material.

There can be no guarantee that the operational and financial measures the Company has taken, and may take in the future, will be fully effective.

All forward-looking statements speak only as of the date they are made.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business