78 unchanged sentences
Certain of the pricing components that make up the price for ethylene sold under the Ethylene Sales Agreement are modified to reflect the portion of OpCo's production capacity that is used to process Westlake's purge gas instead of producing ethylene.
−Removed: Costs specific to the processing of Westlake's purge gas are recovered under the Services and Secondment Agreement, and not the Ethylene Sales Agreement.
+Added: Costs specific to the processing of Westlake's purge gas are recovered under the Services and Secondment Agreement (as described below), and not the Ethylene Sales Agreement.
Under the Ethylene Sales Agreement, OpCo has the option to curtail up to approximately 5% of its ethylene production annually in the event OpCo reasonably determines that its sales of such ethylene to third parties during the relevant period would be uneconomic.
−Removed: Pursuan t to the Ethylene Sales Agreement, Westlake's obligation to pay for the annual minimum commitment (95% of OpCo's budgeted ethylene production), which is measured on an annual basis, is not reduced for the first 45 days of a force majeure event, but is reduced for the portion of a force majeure event extending beyond the 45th day.
+Added: Pursuan t to the Ethylene Sales Agreement, Westlake's obligation to pay for the annual minimum commitment (95% of OpCo's budgeted ethylene production), which is measured on an annual basis, is not reduced for a force majeure event lasting fewer than 45 consecutive days.
In the event of a force majeure event, the Partnership recognizes buyer deficiency fees representing fixed margin and unavoided operating and maintenance capital expenditures and maintenance expenses per pound of volume committed by Westlake during the force majeure event.
7 unchanged sentences
Services and Secondment Agreement
−Removed: OpCo and Westlake are parties to the Services and Secondment Agreement, pursuant to which OpCo provides Westlake with various utilities and utility services and in exchange for Westlake providing OpCo with various utility services, comprehensive operating services for OpCo's units, services for the maintenance and operation of the common facilities and seconded employees to perform all services required under the agreement.
+Added: OpCo and Westlake are parties to the Services and Secondment Agreement, pursuant to which OpCo provides Westlake with various utilities and utility services in exchange for Westlake providing OpCo with various utility services, comprehensive operating services for OpCo's units, services for the maintenance and operation of the common facilities and seconded employees to perform all services required under the agreement.
Site Lease Agreements
OpCo and Westlake are parties to two 50-year site lease agreements (the "Site Leases").
−Removed: Under the Site Leases, OpCo leases the real property underlying Calvert City Olefins and Lake Charles Olefins and is granted certain use and access right related thereto, for a base rental amount of $1 per year per site.
+Added: Under the Site Leases, OpCo leases the real property underlying Calvert City Olefins and Lake Charles Olefins and is granted certain use and access rights related thereto, for a base rental amount of $1 per year per site.
Each of the Site Leases is terminable by the lessor upon the occurrence of certain events of default or by OpCo if Calvert City Olefins or Lake Charles Olefins, as applicable, is destroyed by casualty.
−Removed: Pursuant to the Site Leases, the lessor has the right to restore and repurchase the units for fair market value if OpCo fails to expeditiously restore Calvert City Olefins or Lake Charles Olefins, as applicable, following a casualty loss.
−Removed: Subject to the foregoing repurchase right, OpCo may remove its ethylene production facilities and other related improvements for up to one year after expiration or termination of the applicable Site Lease, so long as such removal can be accomplished without material damage or harm to the lessor's property or operations;
−Removed: provided that any assets that are not timely removed by OpCo will be deemed to have been surrendered to the lessor.
+Added: Pursuant to the Site Leases, Westlake has the right to restore and repurchase the units for fair market value if OpCo fails to expeditiously restore Calvert City Olefins or Lake Charles Olefins, as applicable, following a casualty loss.
+Added: Subject to the foregoing repurchase right, OpCo may remove its ethylene production facilities and other related improvements for up to one year after expiration or termination of the applicable Site Lease, so long as such removal can be accomplished without material damage or harm to Westlake's property or operations;
+Added: provided that any assets that are not timely removed by OpCo will be deemed to have been surrendered to Westlake.
Omnibus Agreement
15 unchanged sentences
See "Liquidity and Capital Resources" in Item 7.
−Removed: "Management's Discussion and Analysis" for discussions of the Partnership's and OpCo's debt agreements with Westlake and "Interest Rate Risk" in Item 7A.
−Removed: "Quantitative and Qualitative Disclosures about Market Risk" for the Partnership's interest rate contract with Westlake.
+Added: "Management's Discussion and Analysis of Financial Condition and Results of Operations" for a discussion of the Partnership's and OpCo's debt agreements with Westlake and "Interest Rate Risk" in Item 7A.
+Added: "Quantitative and Qualitative Disclosures about Market Risk" for a discussion of the Partnership's interest rate contract with Westlake.
Environmental
1 unchanged sentence
National, state or provincial and local standards regulating air, water and land quality affect substantially all of our manufacturing locations.
−Removed: Compliance with such laws and regulations has required and will continue to require capital expenditures and increase operating costs.
+Added: Compliance with such laws and regulations has required and will continue to require capital expenditures and increased operating costs.
Pursuant to our arrangement with Westlake, Westlake will indemnify us for liabilities that occurred or existed (in connection with compliance with such laws and regulations) prior to August 4, 2014.
3 unchanged sentences
We estimate that OpCo will make capital expenditures of approximately $2.2 million in 2022 and $0.9 million in 2023, respectively, related to environmental compliance.
−Removed: The expected 2022 capital expenditures are relatively higher than the amounts OpCo has spent related to environmental compliance in recent years due to increased capital expenditures of approximately $11.4 million related to corrective actions required by the Environmental Protection Agency (the "EPA") to resolve the flare enforcement matter discussed below.
−Removed: Under the Omnibus Agreement, Westlake is required to indemnify us against costs incurred as a result of such corrective actions.
−Removed: See "Business—Our Agreements with Westlake— Omnibus Agreement ." The majority of the 2021, and the remainder of the 2022, estimated expenditures are related to equipment replacement and upgrades.
−Removed: We anticipate that stringent environmental regulations will continue to be imposed on us and the industry in general.
−Removed: Under the Ethylene Sales Agreement, we may be entitled to charge Westlake a monthly surcharge as a result of complying with certain changes in law after our IPO.
+Added: Additionally, in 2022 and 2023 capital expenditures of approximately $24.9 million and $29.8 million, respectively, are expected to be incurred related to corrective actions required by the Environmental Protection Agency (the "EPA") to resolve the flare enforcement matter discussed below.
+Added: Under the Omnibus Agreement, Westlake will incur costs for such corrective actions.
+Added: See "Business—Our Agreements with Westlake— Omnibus Agreement ." We anticipate that stringent environmental regulations will continue to be imposed on us and the industry in general.
+Added: Under the Ethylene Sales Agreement, we may be entitled to charge Westlake a monthly surcharge as a result of complying with certain changes in law occurring after our IPO.
See "Business—Our Agreements with Westlake— Ethylene Sales Agreement.
−Removed: " Although we cannot predict with certainty future expenditures, management believes that our current spending trends will continue.
+Added: " Although we cannot predict with certainty future expenditures, management believes that our current spending trends for environmental compliance will continue.
Potential Flare Modifications .
1 unchanged sentence
On April 21, 2014, Westlake received a Clean Air Act Section 114 Information Request from the EPA which sought information regarding flares at the Calvert City and Lake Charles facilities.
−Removed: The EPA has informed Westlake that the information provided leads the EPA to believe that some of the flares are out of compliance with applicable standards.
+Added: The EPA notified Westlake that it believes that some of the flares are out of compliance with applicable standards.
The EPA has indicated that it is seeking a consent decree that would obligate Westlake to take corrective actions relating to the alleged noncompliance.
1 unchanged sentence
As discussed above, Westlake is expected to fully indemnify us for such costs.
+Added: Flash Fire at Petro 2.
+Added: There are lawsuits pending in connection with the flash fire at the quench tower that occurred in September 2021 during the Petro 2 turnaround, which are described in Note 16 to the consolidated financial statements included in "Item 8.
+Added: Financial Statements and Supplementary Data" of this Form 10-K.
+Added: We expect insurance to cover most of the costs associated with these lawsuits.
Also, see the discussion of our environmental matters contained in "Item 1A.
−Removed: Risk Factors" and "Item 3—Legal Proceedings" below.
+Added: Risk Factors" and "Item 3.
+Added: —Legal Proceedings" below.
Human Capital
Neither we nor OpCo has any employees.
−Removed: Under the Services and Secondment Agreement with Westlake, Westlake seconds employees to OpCo to allow OpCo to operate its facilities.
+Added: Under the Services and Secondment Agreement with Westlake, Westlake seconds employees to OpCo to allow OpCo to operate its facilities, and we sometimes refer to these individuals, for drafting convenience only, as our employees because they provide services directly to us.
Such seconded employees are under OpCo's control while they work on OpCo's facilities.
3 unchanged sentences
We believe that Westlake's relationship with the local union officials and bargaining committees is open and positive.
+Added: Westlake is responsible for human capital management policies, including any human capital measures and objectives that management focuses on in managing the business.
Legal Proceedings
2 unchanged sentences
Due to the Ethylene Sales Agreement and integration with Westlake, OpCo does not directly compete with other ethylene producers for 95% of the planned volumes it produces.
−Removed: It is only on the 5% of planned ethylene volumes not sold to Westlake where OpCo competes with other regional merchant ethylene producers, including LyondellBasell Industries, N.V., Shell Chemical Company, BASF Corporation and Motiva Enterprises LLC.
+Added: It is only on the 5% of planned ethylene volumes and any excess volumes not sold to Westlake where OpCo competes with other regional merchant ethylene producers, including LyondellBasell Industries, N.V., Shell Chemical Company, BASF Corporation and Motiva Enterprises LLC.
Available Information
6 unchanged sentences
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.