9 unchanged sentences
• OpCo is a restricted subsidiary under certain indentures governing Westlake's senior notes.
−Removed: • The ethylene sales price charged under the Ethylene Sales Agreement is designed to permit OpCo to cover the substantial majority of its operating costs, but not our public partnership and other OpCo costs, which reduce our net operating profit.
+Added: • The ethylene sales price charged under the Ethylene Sales Agreement is designed to permit OpCo to cover the substantial majority of its operating costs, but not our public partnership, debt and other OpCo costs, which reduce our net operating profit.
• If OpCo is unable to renew or extend the Ethylene Sales Agreement beyond the initial 12-year term or the other agreements with Westlake upon expiration of these agreements, our ability to make distributions in the future could be materially adversely affected and the value of our units could decline.
4 unchanged sentences
The amount and timing of such reimbursements are determined by our general partner.
−Removed: • The impact and effects of public health crises, pandemics and epidemics could materially adversely affect OpCo's business, financial condition and results of operations.
Business Operations
5 unchanged sentences
• Our variable-rate debt exposes us to increases in interest rates, which could have a material impact on our financial position, results of operation and cash flows, and could reduce the price at which our common units trade.
+Added: • The impact and effects of public health crises, pandemics and epidemics could materially adversely affect OpCo's business, financial condition and results of operations.
Risks Relating to Our Partnership Structure
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In addition, Westlake is not obligated to purchase ethylene with respect to any period during which OpCo's facilities are not operating due to scheduled or unscheduled maintenance or turnarounds other than under certain circumstances relating to the occurrence of force majeure.
−Removed: We expect that each of OpCo's facilities will have a turnaround approximately once every five years and will not operate for typically between 30 and 60 days during each separate turnaround.
+Added: We expect that each of OpCo's facilities will have a turnaround approximately once every five to eight years and will not operate for typically between 30 and 60 days during each separate turnaround.
However, the duration of any turnaround activities may be longer than expected or may cost more than originally estimated.
1 unchanged sentence
A suspension of Westlake's obligations under the Ethylene Sales Agreement, including during periods where OpCo's facilities are not operating due to scheduled or unscheduled maintenance or turnarounds, would reduce OpCo's revenues and cash flows, and could materially adversely affect our ability to make distributions to our unitholders.
−Removed: Westlake may be unable to generate enough cash flow from operations to meet its minimum obligations under the Ethylene Sales Agreement if its business is adversely impacted by competition, operational problems, general adverse economic conditions or the inability to obtain feedstock.
+Added: Westlake may be unable to generate enough cash flow from operations to meet its minimum obligations under the Ethylene Sales Agreement if its business is adversely impacted by competition, operational problems, international trade barriers, general adverse economic conditions or the inability to obtain feedstock.
For example, lower prices of crude oil could lead to a reduction in the cost advantage for natural gas liquids-based ethylene derivatives in North America, such as Westlake's, as compared to naphtha-based ethylene derivatives.
+Added: Additionally, Westlake operates internationally and could be adversely affected by trade barriers, tariffs and duties, or violations of international fair trade laws by global competitors.
As a result, Westlake's margins and cash flows could be negatively impacted during such period.
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In addition, any acceleration of debt under Westlake's credit facility will constitute a default under some of Westlake's other debt, including the indentures governing its senior notes.
−Removed: The ethylene sales price charged under the Ethylene Sales Agreement is designed to permit OpCo to cover the substantial majority of its operating costs, but not our public partnership and other OpCo costs, which reduce our net operating profit.
+Added: The ethylene sales price charged under the Ethylene Sales Agreement is designed to permit OpCo to cover the substantial majority of its operating costs, but not our public partnership, debt and other OpCo costs, which reduce our net operating profit.
The purchase price under the Ethylene Sales Agreement is based on OpCo's actual ethane, other feedstock and natural gas costs and an annual estimate of other operating costs and maintenance capital expenditures and other turnaround expenditures.
7 unchanged sentences
In addition, under these circumstances, OpCo may be disadvantaged relative to those of its competitors that are in a better position to take advantage of favorable market developments.
−Removed: If OpCo is unable to renew or extend the Ethylene Sales Agreement beyond the initial 12-year term or the other agreements with Westlake upon expiration of these agreements, our ability to make distributions in the future could be materially adversely affected and the value of our units could decline.
−Removed: Westlake's obligations under the Ethylene Sales Agreement, the Feedstock Supply Agreement and the related Services and Secondment Agreement will become terminable by either party commencing December 31, 2026.
+Added: If OpCo is unable to renew or extend the Ethylene Sales Agreement beyond the initial 12-year initial term or the other agreements with Westlake upon expiration of these agreements, our ability to make distributions in the future could be materially adversely affected and the value of our units could decline.
+Added: Westlake's obligations under the Ethylene Sales Agreement, the Feedstock Supply Agreement and the related Services and Secondment Agreement continue in effect until December 31, 2026, after which such agreements will extend on an annual basis unless and until terminated by either party upon at least 12 months' prior written notice.
If OpCo were unable to reach agreement with Westlake on an extension or replacement of these agreements, then our ability to make distributions on our common units could be materially adversely affected and the value of our common units could decline.
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Moreover, given the integration of OpCo's ethylene production facilities and Westlake's Lake Charles and Calvert City facilities, it may not be practical for us or for a third party to provide site services or labor for OpCo's ethylene production facilities separately.
+Added: Additionally, certain of Westlake's employees in North America are represented by labor unions and works councils.
+Added: Our operations may be adversely affected by strikes, work stoppages and other labor disputes involving those employees that operate and maintain OpCo's ethylene production facilities and other assets.
+Added: For example, on November 1, 2024, bargaining unit employees of Local Lodge No.
+Added: 2781 of the IAM began a strike at our Calvert City, Kentucky facility, after the IAM members did not accept Westlake's final offer for a new collective bargaining agreement.
+Added: The strike ended on November 8, 2024, after the IAM accepted Westlake's offer for a new collective bargaining agreement.
+Added: Any future strikes or work stoppages could be significant and have an adverse effect on our financial condition and results of operations.
OpCo's ability to receive greater cash flows from increased production may be limited by the Ethylene Sales Agreement.
11 unchanged sentences
The reimbursement of expenses and payment of fees, if any, to our general partner and its affiliates reduce the amount of our earnings and, thereby, our ability to distribute cash to our unitholders.
−Removed: The impact and effects of public health crises, pandemics and epidemics could materially adversely affect OpCo's business, financial condition and results of operations.
−Removed: Public health crises, pandemics and epidemics, such as the COVID-19 pandemic, could materially adversely affect OpCo's business, financial condition and results of operations.
−Removed: Such events have resulted in and may again result in authorities implementing numerous measures to try to contain the disease, such as travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns, among others.
−Removed: Such events have had and could again have widespread adverse impacts on the global economy, many of OpCo's facilities and its employees, customers and suppliers.
−Removed: These and similar events have caused and may again cause supply chain constraints and disruptions and workforce availability issues as well.
Business Operations
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We use hazardous substances and generate hazardous wastes and emissions in our manufacturing operations.
−Removed: Our industry is highly regulated and monitored by various environmental regulatory authorities such as the EPA.
+Added: Our industry is highly regulated and monitored by various environmental regulatory authorities such as the Environmental Protection Agency (the "EPA").
As such, we are subject to extensive federal, state and local laws and regulations pertaining to pollution and protection of the environment, health and safety, which govern, among other things, emissions to the air, discharges onto land or waters, the maintenance of safe conditions in the workplace, the remediation of contaminated sites, and the generation, handling, storage, transportation, treatment and disposal of waste materials.
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On April 27, 2023, the EPA proposed amendments to the National Emission Standards for Hazardous Air Pollutants ("NESHAPs") for ethylene production following the receipt of several petitions for reconsideration for the provisions addressing work practice standards for pressure relief devices, emergency flaring, and degassing of floating roof storage vessels.
+Added: On April 4, 2024, the EPA finalized the proposed amendments, removing the force majeure exemption for pressure relief devices and emergency flaring, clarifying degassing requirements for floating roof storage vessels, and addressing other corrections and clarifications.
In April 2023, the EPA proposed amendments to new source performance standards for the synthetic organic chemical manufacturing industry and amendments to the national emissions standards for hazardous air pollutants for the synthetic organic chemical manufacturing industry and group I & II polymers and resins industry.
−Removed: These proposed amendments, among other things, would impose tougher emissions limits, additional leak detection and repair obligations, certain performance standards for the operation of flares at applicable facilities, and new fenceline air monitoring for several chemicals.
−Removed: Although we cannot predict the outcome or timing of EPA's final rule amendments, the amendments as proposed would require us to incur further capital expenditures and increase operating costs.
+Added: The proposed amendments were finalized on May 16, 2024 and became effective July 15, 2024.
+Added: These amendments, among other things, impose tougher emissions limits, additional leak detection and repair obligations, certain performance standards for the operation of flares at applicable facilities, and new fenceline air monitoring for several chemicals.
+Added: The amendments may require us to incur further capital expenditures and increase operating costs.
Our operations also produce greenhouse gas ("GHG") emissions, which have been the subject of increased scrutiny and regulation.
8 unchanged sentences
On December 13, 2023, the 28th annual United Nations Climate Change Conference ("COP 28"), which was held in Dubai, issued its first global stocktake, which calls on parties, including the United States, to contribute to the transitioning away from fossil fuels, reduce methane emissions, and increase renewable energy capacity, among other things, to achieve net zero emissions by 2050.
+Added: In January 2025, the United States submitted formal notification to the United Nations that it intends to withdraw from the Paris Agreement.
+Added: Pursuant to the terms of the Paris Agreement, the withdrawal will take effect in January 2026.
Legislation to regulate GHG emissions has periodically been introduced in the United States Congress, and such legislation may be proposed or adopted in the future.
6 unchanged sentences
As our chemical processing results in GHG emissions, these and other GHG laws and regulations could affect our costs of doing business.
+Added: Various jurisdictions have considered or adopted laws and regulations on GHG emissions, with the general aim of reducing such emissions.
+Added: The EPA currently requires certain industrial facilities to report their GHG emissions, and to obtain permits with stringent control requirements before constructing or modifying new facilities with significant GHG emissions.
+Added: On March 6, 2024, the U.S.
+Added: Securities and Exchange Commission ("SEC") adopted a new set of rules that require a wide range of climate-related disclosures, including material climate-related risks, information on any climate-related targets or goals that are material to the registrant's business, results of operations, or financial condition, Scope 1 and Scope 2 GHG emissions on a phased-in basis by certain larger registrants when those emissions are material and the filing of an attestation report covering the same, and disclosure of the financial statement effects of severe weather events and other natural conditions including costs and losses.
+Added: Multiple lawsuits have been filed challenging the SEC's new climate rules, and on April 4, 2024, the SEC issued an order staying the final rules until judicial review is complete.
+Added: In September 2023, California passed climate-related disclosure mandates that are broader than the SEC's rules.
+Added: As our chemical processing results in GHG emissions, these and other environmental disclosure laws and regulations could affect our costs of doing business.
We also may face liability for alleged personal injury or property damage due to exposure to chemicals or other hazardous substances at our facilities or to chemicals that we otherwise manufacture, handle or own.
14 unchanged sentences
We are subject to operational and financial risks and liabilities associated with the implementation of and efforts to achieve carbon emission reduction goals.
−Removed: Westlake has publicly announced a GHG emissions reduction target for 2030 (which includes emissions from our operations), which is a 20% reduction in Westlake's scope 1 and scope 2 carbon dioxide equivalent emissions per ton of production by 2030 from a 2016 baseline.
+Added: Westlake has publicly announced a target 20% reduction in its Scope 1 and Scope 2 CO2 equivalent emissions intensity per ton of production by 2030 from a 2016 baseline.
Developing and implementing plans for compliance with voluntary climate commitments can lead to additional capital, personnel, operations and maintenance expenditures and could significantly affect the economic position of existing facilities and proposed projects.
6 unchanged sentences
Such disruptions could include, but are not limited to, delaying or cancelling customer orders, impeding the manufacture or shipment of products or causing standard business processes to become ineffective, or the unintentional or malicious disclosure of proprietary, confidential or other sensitive information.
−Removed: Cyber-attacks could include, but are not limited to, ransomware attacks, malicious software, attempts to gain unauthorized access to our systems or data or other electronic security breaches that could lead to disruptions in critical systems, unauthorized release, corruption or loss of data including protected information such as personal information of our employees, interruptions in communication, loss of our intellectual property or theft of our sensitive or proprietary technology, loss or damage to our data delivery systems, or other cybersecurity and infrastructure systems, including our property and equipment.
+Added: Cyber-attacks could include, but are not limited to, ransomware attacks, malicious software, attempts to gain unauthorized access to our systems or data or other electronic security breaches that could lead to disruptions in critical systems, unauthorized release, corruption or loss of data including protected information such as personal information of our employees, interruptions in communication, loss of our intellectual property or theft of our sensitive or proprietary technology, loss or damage to our data delivery systems, or other cybersecurity and infrastructure systems, including our property and equipment, diversion of management or work force attention, or increased costs required to prevent, respond to or mitigate the incident.
+Added: In addition, cybersecurity risk is exacerbated with the advancement of technologies like artificial intelligence, which malicious third parties are using to create new, sophisticated and more frequent attacks.
Westlake's and our employees, systems, networks, products, facilities and services remain potentially vulnerable to sophisticated cyber-attacks, including the additional cybersecurity risks posed by the increased use of remote networking technologies and services, and, as such, there can be no assurance that a system failure, network disruption or data security breach will not have a material adverse effect on our operations, business, financial condition, operating results or cash flow.
4 unchanged sentences
Each of the OpCo Revolver and the MLP Revolver have interest rates in-part based on SOFR at the time of any borrowing.
−Removed: The Board of Governors of the Federal Reserve System increased benchmark interest rates seven times in 2022, four times in 2023, and may further raise rates in future periods.
+Added: The Board of Governors of the Federal Reserve System increased benchmark interest rates four times in 2023 and lowered benchmark interest rates three times in 2024.
+Added: However, rates remain above the ten-year average and may rise in future periods.
Should interest rates increase significantly, the amount of cash required to service our debt would increase.
6 unchanged sentences
Terrorist activities and the threat of potential terrorist activities and any resulting economic downturn could adversely affect our results of operations, impair our ability to raise capital or otherwise adversely impact our ability to realize certain business strategies.
+Added: The impact and effects of public health crises, pandemics and epidemics could materially adversely affect OpCo's business, financial condition and results of operations.
+Added: Public health crises, pandemics and epidemics, such as the COVID-19 pandemic, could materially adversely affect OpCo's business, financial condition and results of operations.
+Added: Such events have resulted in and may again result in authorities implementing numerous measures to try to contain the disease, such as travel bans and restrictions, quarantines, shelter-in-place orders and shutdowns, among others.
+Added: Such events have had and could again have widespread adverse impacts on the global economy, many of OpCo's facilities and its employees, customers and suppliers.
+Added: These and similar events have caused and may again cause supply chain constraints and disruptions and workforce availability issues as well.
Risks Relating to Our Partnership Structure
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Our partnership agreement does not require us to pay any distributions at all.
−Removed: The board of directors adopted a cash distribution policy pursuant to which we intend to distribute quarterly at least $0.2750 per unit on all of our units to the extent we have sufficient cash after the establishment of cash reserves and the payment of our expenses, including payments to our general partner and its affiliates.
+Added: The board of directors of our general partner adopted a cash distribution policy pursuant to which we intend to distribute quarterly at least $0.2750 per unit on all of our units to the extent we have sufficient cash after the establishment of cash reserves and the payment of our expenses, including payments to our general partner and its affiliates.
However, the board may change such policy at any time at its discretion and could elect not to pay distributions for one or more quarters.
44 unchanged sentences
Liabilities to partners on account of their partnership interests and liabilities that are non-recourse to the partnership are not counted for purposes of determining whether a distribution is permitted.
−Removed: Public and investor sentiment towards climate change and other environmental, social and governance ("ESG") matters could adversely affect our cost of capital and the price of our common units.
+Added: Public and investor sentiment towards climate change and other sustainability matters could adversely affect our cost of capital and the price of our common units.
There have been intensifying efforts within the investment community (including investment advisors, investment fund managers, sovereign wealth funds, public pension funds, universities and individual investors) to promote the divestment of, or limit investment in, the equity of companies in the petrochemical industry.
1 unchanged sentence
Because we operate within the petrochemical industry, if these efforts continue or expand, our stock price and our ability to raise capital may be negatively impacted.
−Removed: Members of the investment community are increasing their focus on ESG practices and disclosures by public companies, including practices and disclosures related to climate change and sustainability, D&I initiatives and heightened governance standards.
−Removed: In March 2022, the SEC proposed enhanced climate-change disclosure requirements.
−Removed: As a result, we may continue to face increasing pressure regarding our ESG disclosures and practices.
−Removed: Additionally, members of the investment community may screen companies such as ours for ESG disclosures and performance before investing in our common units.
−Removed: Over the past few years, there has also been an acceleration in investor demand for ESG investing opportunities, and many large institutional investors have committed to increasing the percentage of their portfolios that are allocated towards ESG investments.
−Removed: With respect to any of these investors, our ESG disclosures and efforts may not satisfy the investor requirements or their requirements may not be made known to us.
−Removed: If we or our securities are unable to meet the ESG standards or investment criteria set by these investors and funds, we may lose investors or investors may allocate a portion of their capital away from us, our cost of capital may increase, and our common unit price may be negatively impacted.
+Added: Members of the investment community are increasing their focus on sustainability practices and disclosures by public companies, including practices and disclosures related to climate change and sustainability, D&I initiatives and heightened governance standards.
+Added: On March 6, 2024, the SEC adopted a new set of rules that require a wide range of climate-related disclosures, including material climate-related risks.
+Added: Multiple lawsuits have been filed challenging the SEC's new climate rules, and on April 4, 2024, the SEC issued an order staying the final rules until judicial review is complete.
+Added: In September 2023, California passed climate-related disclosure mandates that are broader than the SEC's rules.
+Added: As a result, we may continue to face increasing pressure regarding our sustainability disclosures and practices.
+Added: Additionally, members of the investment community may screen companies such as ours for sustainability disclosures and performance before investing in our common units.
+Added: Over the past few years, there has also been an acceleration in investor demand for sustainability investing opportunities, and many large institutional investors have committed to increasing the percentage of their portfolios that are allocated towards sustainability investments.
+Added: With respect to any of these investors, our sustainability disclosures and efforts may not satisfy the investor requirements or their requirements may not be made known to us.
+Added: If we or our securities are unable to meet the sustainability standards or investment criteria set by these investors and funds, we may lose investors or investors may allocate a portion of their capital away from us, our cost of capital may increase, and our common unit price may be negatively impacted.
Our tax treatment depends on our status as a partnership for U.S.
145 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.