PBF Energy (PBF) 10 Feb 222021 Q4 Earnings call transcript

Good day, everyone, and welcome to the PBF Energy Fourth Quarter 2021 Earnings Conference Call and Webcast. At this time, all participants have been placed in a listen-only mode, and the floor will be opened for your questions following management's prepared remarks. [Operator Instructions] Please note this conference is being recorded. It is now my pleasure to turn the floor over to Colin Murray of Investor Relations. Sir, you may now begin.

[Ph]. [Vikram] you, Thank welcome call. and to morning, today's Good With Lucey, CFO; our are Tom and CEO; Matt Nimbley, our team. President; management other of me members today several our Erik Young, our site. including of copy is our today's release, A supplemental earnings available information, on Web

started, are release your federal are covered actual provisions that future, to our our of Before intended the by express on in call with be cause and Harbor describe from those filings forward-looking to I'd the securities statements the Statements release. expectations, the to Safe Harbor we including today's results management's could that many predictions under to in made the differ contained press like There those laws. expectations company's factors in Safe direct getting attention statement our or or press this SEC.

are excluding that For XXXX an report XX-K discuss our Consistent that our number PBF re-measurement assets, in remarks. $X.XX cumulative million, of in highlight benefit share. prior Included information, a of in periods, week's quarter special a of increased included per resulted which other our will press items items results the in the should impact included net non-cash $X.X There of The be for in by number income quarter. effects after-tax the today items. and PBF tax will notable time. are or the Erik our special deferred his benefit tax in a release, items we the with special fourth Logistics we of describe results. In today's Energy available results

supplemental provided Nimbley. the over call, release. today's any please in of non-GAAP Tom on I'll reconciliations measures now refer to to today's the tables For turn call press mentioned

of we Thanks, Colin. income thank $X.XX and per call. Good share, everyone, for fourth adjusted Today, you net million. and $XXX earnings our quarter reported of joining morning

us who our dedication Before all very challenging year. finish and PBF refinery the would started momentum terminal commenting our their for building products. inside and outside that quarter, strongly demand on of out of allowed all our positive to like what strong efforts those to employees worked I generated on alongside Through fourth environment, and continued by and we the thank for the us as gates, a macro

complexity high course as the of improving benefited refining continued measured system Our supply from OPEC+ over crude XXXX. their increases differentials

trend We extend into expect to XXXX. that

tight, markets. are stocks. demand lower-quality contributing crude for We seeing strong has for in to and tight led product also remain that, this certain light favorable Having regions, feed is differentials in part said markets which crude to

cover. of the capacity Product remains refining are days As levels, this jet and view demand we inventories from a continues exited global trailing a XXXX, should low, XXXX are favorable setup to We low below inventories gasoline, of very inventories margins. strengthen, driver. currently and capacity terms Domestic demands were diesel, board. and below all are and XXXX Perhaps lows. more low average in all across levels due gasoline, five-year the as constructive refinery support jet importantly, key perspective, Demand stocks diesel, forward for all rationalization XXXX. to

in demand XXXX With expect turn over to call now its exceed and strong I Matt. that, We XXXX. will will continue the recovery,

Thank you, Tom.

sulfur direction. are quarter. units. note, we in a We and with market certainly year Overall, crude the As they and well Tom a had on while finished turnaround operated mentioned, work current in good on conditions PBF trending high Coast, the as the East are the right completing pleased the

assets sulfur and in on of well, West feed cat turnaround Martinez. the on and Gulf our repairs through While completion Toledo, ran Coast downtime ran and complete, now in we as are planned. Chalmette hydrotreater suffered planned we including running the Coast very the are the plant, at well

is today's guidance throughput and press CapEx our release. quarter, first presented the in to ahead Looking

Coast. represents work ongoing Coast of primarily the first on the The East work quarter West with and our turnaround year, the XX% for approximately

advanced quarter. Over product cost, project flexibility, Louisiana the to capital we to of We have local past regards project we optionality, closely We cost, believe diesel have with and we the geographic have our secure the a the year, and to we and renewable be feed anticipate that all To support engineering of for renewable and project permits operating Chalmette. time completed work with market. a year. and designed date, as The top-tier which state with in official of design. with their day project began of earn the incentives begin capabilities full necessary capability. capacity, production full pre-treatment as barrels will XX,XXX next tax is in last well We construction, to in first-half property fully fuels

We total $X.XX project come of per scope. gallon, we with believe cost and compares expect our under this in and similar to projects size favorably

idle able hydrocracker. capital to leveraging this refinery, We Chalmette achieve the idled are efficiency equipment by existing an including at

have the also from an refinery. top-tier facility terms to to The benefit with addition costs. directly cost a operating will advantages, we collocated facility capital expect In of operating being in

deliver essentially the location, the access direct is and [Ph] Mississippi Mississippi, and Additionally, flows River at globally. with with the products intersection attractive to green the to on of ideal the Chalmette's Mexico, full most optionality markets belt and [RD] the Gulf of to trade

statewide In are further RD demand be operating will able by utilizing across we capital California, a we will expense our lowest different deliver we development, project number evaluating logistics Europe, where all and into with including With alternatives markets, footprint. be and the the of financing cost existing structure. parallel advantaged we the Canada, the the of believe barrels combination to advantages, key

on expressed be activities able potential with advisors interest provide these to an encouraged the by and are counterparties. the We coming update by We are months. in financial should working

as After that the ‘XX I delay, also for driving months call the headwinds one this country. the turning ‘XX strongest must and the adjusted not the higher and pump EPA comment RVO only also is but Before the offered over every still for consumer of proposal RFS, in of at XXXX. to industry's is Erik, costs on finally

While ethanol proposals RINs for generation, an RIN and ‘XX. unachievable appropriately XXXX RVO EPA’s the reflect in the XXXX proposed actual EPA

projections, are, markets the increased is shortfall by RIN to If persist. then need EPA to ‘XX forward will the which as creates more been such laid lot of billion significant create looking. ‘XX. out from has be a ‘XX materialize the hearing with Administration fails easily with in most EIA This requirement. rely more market the calls gallons that at the RIN previous increase And would large. stakeholders scarcity the out conventional whereby market on in on To demand bank in we in RVO RINs would end As of will X.X and the to runs the generation. a advanced RIN market depleting RIN scenario line market ‘XX simply, problems problems it for on the biofuel lower

workable hopeful be can final lot sensible a like to wait Erik. this you, to area. have with coming and program there will is There are pathway rule. rule speculate until is but a will over it we that, I’ll And more turn With to a we So, the more news in finalized. the

adjusted continued of recovery improve to pivot financial XXXX based second-half on from A the results Matt. the market reported EBITDA our $XXX reflect product the during in free to of improving approximately Most Today, refining we quarter you, second as million. strong following year. the demand profitability quarter flow positive pandemic generation our last importantly, continues. an Thank fourth cash

$XX million EBITDA for XXXX obligations prior cap environmental ABXX RINs adjusted with net trade notable Our income cash $XX and to items. crude around Consistent two our million recognized we We includes of approximately and QX incremental non-cash settlement roughly to to related outstanding adjustments wanted provide our context quarters, our expenses. our California obligation.

years. balance approximately $XXX decreased million million California $XXX million. to since be approximately settled to obligation a over Our that accrual relates of roughly Of by overall next has the will our $XXX QX this, few

million. accrued RIN approximately obligation was at Our $XXX yearend

We mark-to-market this the valued year for position be we to first CapEx fixed $XXX million PBF purchase RIN commitments million of and million the satisfied end at with during was continue quarter that quarter and million to price expect corporate year. $XXX $XXX a includes Consolidated for $XXX CapEx being million which approximately refining the remaining for which Logistics. $X carry was

our XXXX, million. under $XXX consolidated totaled expenditures full-year the For just capital

refining increased capital we XXXX, over to focus our continue expenditures planned disciple. on are capital in XXXX While

$XXX maintenance, historical address annual safety to to this environmental, $XXX the requirements. Our expect range. is turnaround the near-term we planning regulatory, approach with million to we million prudent and And XXXX. in our pandemic, been Consistent have believe it capital during in consistently expenditures continue

We expect in million the $XXX capital incur of to expenditures million approximately year. to of first-half $XXX this turnaround related

end in day-to-day level billion of liquidity our billion than operational by total excess of of necessity, of of $X.X availability remains quarter. at liquidity borrowing on maintained the liquidity and and a of the more consistent billion beyond Throughout hand Our we cash with needs. $X.X including pandemic $X.X the approximately positions cash

business to levels As improve, liquidity. return conditions we to previous expect of operating

As underway. quarter is deleveraging during we process our call, third the discussed

Our $XXX efforts of in XXXX in reduction resulted more million. debt than

that of for organic at will strengthen, form into As demand translate continue PBF. our to products continued in statistics core should mobility result profitability leverage lower an net

flexibility of most at to be In to the successful intermediation note extend maturities. inventory longer-term bank between and maturity XXXX address of and to Similar and amend tenure. structure, of and will priorities step Successful PBF to multi-year the near-term attractive facility, deleveraging, this our and at of PBF the groundwork XXXX addition, the our lays our and PBF balance facilities capital, find our execution Logistics, of addressing refinancing Logistics. is for extension one a cost unsecured the debt Holding goal

pleased if costs, cash. goals safely to on to be reliably, market we've our we'd achievable completed Operator, focus and Our are take remarks, controlling operating generating any and opening in this continue and questions. we

JPMorgan. ahead. First Thank we questions. from Phil of go will the for Instructions] [Operator call you. the Gresh is question Please open with moment, In line a

moving the Hey, respect terms just the to mark-to-market RVOs also good of in catch-up fully make effects some had pieces, respect of there ABXX] of with that? respect any comments the morning. quarter, Erik, I sure the Was in talked some with refineries the effects [RINs to to the understand changing kind about your you impact [Ph]. in with and quarter, the to of other with

million is mark-to-market, right. move Yes, the prices quarter-over-quarter. materially roughly, the, $XX didn't RIN that

out So, the it, $XX the QX. standard in came to, relates change million call that let's

$XXX $XX adjusted million $XXX million is, to million. say of income-related non-cash of So, $XX the million-plus EBITDA way read there, worth the roughly included income-related items it items, another to

there. you Okay, thank overall know first-half, you how you as I do just share I spending making Just And turnaround it spending guess sense. spending think about And be you at some there XXXX, then will Matt for and the this the any perfect, is the forward, you. that was with additional on in XXXX? but thoughts makes that moving comments could project? overall, one-time for That's look Chalmette, mentioned officially year

Sure.

the that of of So, other right, $XX project, course million made of cash is year. commitments renewable handful the was $XXX throughout the in the that million XXXX, diesel we of during were primarily invested a engineering, that it's around there spent

spend is weighted, renewable the Fortunately, diesel the the on bulk project be right. to backend of going

project have And at talking financial at a quartile respect this this top have right, received. an to about incentives the what we that be this we've So, to cost. mentioned we're the project, believe fund I is with today advanced The point, Matt using tax we year. that permitted. we throughout project position in competitive think advisors, we of the Again, is extremely project fully will project. course point, fully

that standpoint, come and we And our so, as outside essentially this to us there incubate capital will will from believe project be incremental help in we internally. continue

for on you the below cost, guess that no just I or just turn expect the And of tax about even over. didn't do guess of in is you I'll forward a move and inclusive if have project, the next the the think cost you're saying there a Thank partner? how it PBF $X.XX things pre if you'd that you cost I partner credits and next So, you. is other cost would gallon

required property just us pre-treatment regards capability net cost, under all that a with -- for full $X.XX $X.XX Just as forgiveness expenses in expect business. to Louisiana. incentive, to excuse state our to regards gallon, we we as with address barrels ongoing in The because to in $X.XX we're manufacture the question a at diesel the encompasses -- helps your day XX,XXX of can, fully an to come capital that's operating of operating, the on a renewable But from barrel head be me. all once to the tax the capital

$XX million let's date, PBF, of a XXXX. up, let's say is $XX which $XX million. for this to the million invested is all-in, Phil, million just So, $XXX that round course through We've

be plan remaining six is next to We've to continue de-risked. all $XXX received significantly the our quarters, million. invest permits. project of the The the would Over

to incubate project. We will, continue the at PBF,

some countless We raising basically in-bounds. administer received have project. We capital a assistance, believe, with helping

Over next be remainder the six producing the through project year position through and will a to in start the renewable diesel months, we midway of fund fully fiscal XXXX, XXXX.

you. Got it, thank

you. Thank

line We Please have Read of the Roger go next from question ahead. the Wells Fargo. with

good morning. you, thank Yes,

Hi.

industry. a the could that two even from I little here. guess see was side. units improving. you Paulsboro seeing it you demand a of, the some more how as say, encountering, the of going hit turnarounds then a broader we story a that There online Obviously, also And bring talked back about story One, kind you're do to function what across detail you're things? the on maybe you're of

press the East demand seeing and supply-demand out, You put you that on better a better but Coast situation. release were

all was here. curious how together So, fitting that just was

We're none that single press -- will planning on press there have clean Roger, to some effort that and product Paul reports. What release, reduce with every some units the will East actually logistics things we day. our do put last entirely refineries, secondary there do would Coast system. be, and that improve Paulsboro. me are are some to then CapEx system, There's our We let mean, didn't We yield, the not or In regards to a [Ph]. address me, changes. of up between continuously headlines I major the our But hand across on comment not we're cracker, no but excuse looking to [you were no a in two Tom we changed reports optimize our press regards over question, the accurate. where only plants. a cost have in to starting throughput cat two coker] major out know, it my weren't Coast, East the I'll

as bit a some always press our on optimizing Coast doing reports So, continuously system. well. we that we're were indeed, And, erroneous, East but are the

starting we So, in will Paulsboro. units, up be specifically some secondary

Yes, Tom, add we East is of issue is as really our on Coast just recovery good work. demand It configuration Roger. and to This Part and started the worked. the I'll morning. utilization, did growing that. up see But particularly if down because opportunities, Paulsboro in the of the we intermediates ourselves Delaware when you getting shut being Delaware the will, Delaware to market in cat found advantage from to constipated, et take [coker] cracker, the cetera. of transferred we [Ph],

and not now production, significant said, So, we're of what is but big products the Matt reduce will starting we're into basically units, up production clean really capture finished Paulsboro products Not doing significantly, increase them transfers is turn as couple those products. better a some to that ones high-value a rate. a going in

as Regarding would as not did. cut our And turnarounds, peers of did down but routine prior we now, the more reinforced, [Ph] Erik the on our pandemic, I that turnarounds, think and maintenance smaller hunker some everybody calls, to indicated steps, return best the -- you could during like cycle. that things as certainly of we're squats, have and nature. the do jeopardize go units, operations a And integrity take going start we of or [RINs] normal of to we take

specifically, year. us of the is the most in For of this first-half

the their unit. Chalmette in of We'll City a and We Torrance reformer. aromatics second Martinez. turnaround a on in the turnaround and is up be have actually a done wrapping already in will taking one be their in taking turnaround in reforming Delaware quarter; process And

And frankly, are of you quite normal at were look downtimes the mentioned. So, a industry. lay of industry of are, in they going to exactly high I and are of to the seems some what what I high rigs scheduled the we other unscheduled for the throughout terms groundwork kind U.S. that and run the parts that's and in saying if the the pretty an think turnarounds world. coupled Certainly with we've in back And happening the seen the utilizations pattern. rationalization increase, type a of

clarifications. appreciate quarter. guys. Thanks, I Good the

Roger. you, Thank

Thank you.

of Leggate Bank America. the from We have Doug with question ahead. of Please go next line

we as on Good morning our could everyone with kick I one of on unit if clarity was That well. I mind the started. things appreciate Erik, costs. RIN I off the actually and wonder the

just You had quarter, RIN and get to fully obviously we're you the the impact on if business through I what if is, quantify was extent obligation? funded walked you the EBITDA cost cash of us your handle was, a the the to cash current what in the can cost wonder what avoidance the could cash cash power avoidance underlying trying you --

Well, we of XX environment right? RVO XXX of million incurred in have a gross outlined throughput about RINs, way our month million roughly We've regular Expense net RINs. RIN every a roughly

that a RINs. to equates of we that have we a third, hits net P&L million blend roughly So, the obligation XXX

assume on depend things. obviously will So, on average, and other turnaround, it so

if We we million incur obligation. of an month RINs have -- per XX

back our that and I XXXX. of a we were to carry related to relatively the straightforward short to summer think third quarter call even continuing in end going the we were

We we $XXX this invested the RIN quarter have right million firm commitments for to essentially price all fixed past fulfill position. our of

a at XXXX, We position are position. consolidated looking XXXX now RIN overall RIN this as

course purchasing is a context million I we over in had of been of reasonable to XXXX had put think would I we expense. RINs throughout have what it would say RIN $XXX on the basis

really through is expense we that RIN is key key the shy $XX so The adjustment employees million of just million, year-to-date as is of dollar than piece That's P&L, million more income. what the P&L pay the hence Our every was flushed $XXX above that XX% recognized year. $XXX message. an X,XXX

generate. that trying think what's out to the if this we're can cash figure business I

way. these Right $XXX really quarter, core the business fourth EBITDA EBITDA, PBF in Coast adjust regular West Our during and earnings driven that's the Logistics of Coast. an the ABXX the generated mark-to-markets, we of what over once of for Gulf right $XX million generated and quarter that's -- million refining business power by

ahead, Now, probably left. we Go Doug.

that. -- are for we're I what understand going is trying just relief but to say that, to to RIN the obligation. get figure I No, you I'm trying somehow unable was to out if

the cash lower. year. million the be to that flow don't would $XXX cash We the yourselves, the but guess understand understand a concur our outflow? obligation to on a expect that cost have. have of we the of been trying cash the and terms end we're with in cumulatively accrued much to like guess, how of company basis? I I if you Your met completely trying related a of look you it what follow-up potential at like I of acknowledge on stupidity got RFS as you lower nevertheless, cadence that What do would obligation, I'm to current

liabilities So we that XXXX XXX have million million, we $XXX fixed. we today, to our relates related for a right $XXX are short RIN RIN of exited is position.

RINs So, XXXX. last times weighted day of the average of number the business RIN as of cost

price for that if didn't we required we million. $XXX to would exposure. be were hook fulfill floating on obligation, the change, So, that rate and That's the

I right, wish All -- okay. with luck good you

speakers]… hang Doug, [multiple on Hey,

market Just though, just is. the fully for we're whether we sure to RIN understand price procuring throughout in expensing so make the quarter RINs whatever the I want you are clear, not. the prevailing We're or RINs

kind let's would significantly And situation if a my gas question, bucks. for margin European quantify if frame two think more uplift is at it structural system might understand generic wonder your second a you guys. we're but for quantify quantify becomes just international of bit maybe current you of appreciate hydrotreating. particular that Hopefully and to kind not on the of both basis, relative a I whether barrel is prices Well, bucks, you that. you help system, forward, A obviously the question clarification versus European higher bit how is energy don't how consequence I it levels. I per is of macro going a three what now trying Yes, Right. I can could constructive. reference? gas a about say that as know the

system, have day $X U.S. we which we We spreads, looking that of at a you if and U.S. on their well, gas function given equivalent even the versus $XX refinery some capability in that's and blend on probably operating for are whether our on able et costs it'll obviously, fleet engine then, you by it gas we own hydrogen costs things. inside be buy hit a three obviously and to you an to cruise individual that rather are significant, what it be you're be very over just process bit at the to the which fleets, that that and of costs gives or do cruise the for either you the the switch and size precipitously, some we of offer hours. least costs going in though, in is And order heavy obviously change a and third of to those there's therefore up configurations, adds to hydrogen change is would a oil these it's hydrocrack the hydrotreat cruise out to the When barrel that costs goes gas switch $XXX plants basically to highest these operating gas increasing gas the fire maybe system, economic Europe based It's and we're basically of light, and that can't and these a buy the in fleets, is But on looked And party $X following the system and up it prices in to other not there absolute that's to points spreads. go to view a cruise significant advantage obviously that, refineries from probably made Europe in natural that then refinery. second a prices at to the or cost our cetera. the our advantage faced if with exposure. because or make, fuel and now, results is place hydrogen and or U.S. retired the more to with going But a seeing versus and back the incur, with the change natural our widening and translates oil, point, little or Europe advantages. clearly natural of paying it's other the to any it Sweden do complexity, production all well advantage significant, a prices, if

to view And to wind the plan. shut and forward. yet fact, The think shut down first to you're know it down sure. you comment as that example made, going question of set a on, a that's the first thought but we plants of permanent perhaps of kind an solar not energy problem. with a is I the and fuel transition execution rely coal shut or starting goal the goals, we're plant own that's now thing? of you be my out view going this a becomes not I to going And well, more But personal and go strategy are is this fossil you're and nuclear the emerged see well for down a own spot if second into structural is don't examples on available, plants, has you my

answer. appreciate I the

So, thanks so much.

Thank you.

question of line from the next Theresa from have ahead. go Barclays. We Chen Please

book former between if capturing if CI, strong pretreatment you given your feedstocks is, run full that of like see understand And you do on compete feedstock idea and given the to thoughts have Chalmette capability. understand and around or you margins XXX% players CI to the in in is I like the or that on I experienced tightness that guess the how Matt, low high the will run CI to trouble if strategic space? the advantages the my CI, facility. basis plan and a market in just rate low morning. do constraints, the question low even has competitive the even Good I'd is

what entry required So, available business, required run economic was have, to less the has competitive a most regards or of the the in -- the have And most to we the plan are believe that market. rate the advantaged for in marketplace. feeds, that’s geographic we optionality economic most But in footprint to run operate capital CI that to bids capital most the all we facility the the we advantaged advantages we’ll to the business, run and all full to regards of run and all flexibility feeds. be one to we’ll do what’s plan for give as within to feeds

the Ag around have commercial organization teams. stand a to capability up We

of It’s We that are doing in it the to that. process important critically early. and get understand into business

So, process in the doing of that. are we

everyone We able have in full market as faith else refining efficiently that And in no the we that business. be will participate as marketplace. again, it’s different the than

or heavy attractive sweet sour crudes to to more the or the crudes. heaving going going when or be exactly crudes know don’t are You the

making advantageous. the and is are be whatever going to have that important you a in really run that’s optionality location what’s you want to So, sure you

it. Got

Hang on a moment. [Multiple Speakers]…

forward. of business. to bit for Renewable are to will margin terms product perhaps diesel going superior look that be call feeds That biodiesel. a transfers the going environment I Also that the just into you in better at differently into little going renewable there it the into of is for market marketplace today. that And will think got be

was Erik, working call capital anything out this And the you. there pieces moving to with Thank quarter? on

$XXX the the managing door, So, point. between line. million inventory were that’s I again clearly related that’s $XXX is At $XXX-ish going this same we worth probably this for to of able have tried the accrued to some then, think that to hit time, right? highlight that out this to is cash accrued going And targets folks from are sheet yes. an balance capital to we million. expense just working incremental at We that viability offset by benefited we on hitting ultimately year-end focus and million continuing $XXX million there or

stuff when working and by to sources cash that left that had the through uses clearly million business, this well And by quarter $XXX inventory about QX of as down specific million refining through the to of cash went of other about And combination a EBITDA, So, we your net offset think was system. the $XXX the we capital. QX.

Thank you.

Thank you.

next the Please with You of go question from Suisse. Gupta Credit ahead. Manav line

I am first than tricky. more have hoping And But, I have policy do. a we these I visibility know are little you question.

of going RVO gallon a at back in somewhat the XXXX. which Then Reuters, changed. put to XX.X EPA August for from So, something there was billion leak

we went November the final right up gallons. Somewhere number out, came in billion back XX to

that gallons are is obligation back we is XX recognizing that cut XX not looking Now billion again possible, again retroactively to [indiscernible]. EPA are to so hearing the what they is billion

obviously was again here? go like was think So, happens never say, November do you first around I and possible. okay, back the XX they question October somewhere what had Do

lower EPA. billion then quarter so, the like then question some with you start to a And $XX it would Erik year million let’s gallon where And of item you XX then RVO like whatever. XX number to number benefit fourth recognized would that in become every recurring a the back the your with be kind this

somewhere is refiners an the down down a quarter end with line which fourth correction. was adjustment year? up make number RVO because they lowered the retroactively Somewhere And most the

you with a try it they that unintended to [reports] to program the going to been ‘XX think administration’s [battered] regards think In degree, got increase was that actually I And has [indiscernible] without put of the consequences happening, RIN years intention can ended previous don’t adjustments that and some I I up I have results. would [Ph] it make to they tinkering around. did. mean what sort start. I’ll [Ph] realizing think They to prices. program was out the

now. that recognized they think I

very to vocal in this counterparts been them. that all tell new And the regard our I represented them parties trades, workforce, affected think building been have to speaking we’ve directly.

they think it. I understand certainly

will they years And easier So, what end not huge be But And I would of the think desired side did shall good the price become we it’s And be for problem fixed, we up that’s last prices them XX see. with losers less everyone. in persisted I years. see. if for they negotiating the come and on over RINs do to XX to it gets RVOs think the down. maybe -- think the adjusting certainly And pressure the on would RIN prices their scares, the but get RIN, get much would the recognize I do of obviously, consumers. for adjust that if should good the It’s doing, war there they gasoline will outcome. the

I point, public fully and most is for prior back at every previously, XXXX And consistent done and kind the to with of we right? think If year to to data accrue go what Manav, recent us. available we XXXX that, this whatever we’ve

or pluses now RIN And So, it the recent result may to minuses pronouncement. sheet. accrual we’ve we If suddenly nothing changed, it the they overall accruing between or QX, retroactive changes clearly QX reside into in of and for be expense reason are in -- reduced the look income ultimately And they XXXX, and for out through percentages in the whatever we hit flow accrued reductions statement. of as the XXXX, if balance QX end we section our adjusted then in our adjusted will we historical methodology. the then are subsequent in will as change laid that overall to most will

quick here being seeing One split kind design you A so, your hydrogen. the of Perfect. is design Chalmette, basically we follow-up are of two made. changes on which

facility. of split the kind You

lower facility, refinery end an but So, end you you with the up capacity. with up nameplate with a RD then slightly

but facility second independent coming completely the refinery The unit. is the RD is at obviously on

to no it as other you to the to does when of refining? there projects relates change Chalmette done capacity wanted comes engineering I have on, nameplate understand And here the nameplate So, change since the work is just capacity.

later. the It’s

it, there the It’ll described from Exxon on having all and Chalmette. at a impact infrastructure bought the zero operations zero you idled equipment we from have will have refinery. all it impact and on was between When benefit it’ll when in the As place, but PDVSA. the utilities marriage there failed back the refinery,

use hydrocracker. discreetly And to not able And refinery operations. the so, it’s are the way any connected idled we in

Thank question. you taking so much for my

you. Thank

line the Goldman with next We Carly Sachs. go have of from Please Davenport question ahead.

Thanks for just morning. the start good side. to wanted the liquidity Hey taking I questions. on

yearend. $X as above You are still billion of

there levels diesel is the accelerate I just optimal So, thinking in microenvironment? performance thinking renewable any And or liquidity this of you how this to guess strong are tap year, investment? type the equity markets about deleveraging public the about appetite the

in I’ll take there. it sequential order

at loosely are historically but would where significant $XXX than $XXX this cash we million from point from swings, look are when where today billion in right, be operational prices hydrocarbon kind this probably for time business back think into right? of go last That at assuming think of swings, perspective crude operate I to and at and dollars of time to crude will prices, obviously a a translates level, the and adjust reasonable numbers given Daily of bigger this liquidity. volatility. lack over Those There current if $XXX a prices we between we again assume. period were again business day-to-day long million. anywhere were I have a ranging,

that bank making Our continue sure refinancing first facilities we but not have priority place. we in XXXX on that essentially only on well the is in operate to

forward So, be our fruition. Then see way months. believe upon assumptions the attacking. will next these we're business. curve regular coming back our how today, All directionally tailwinds Right that's derivative seeing over that six do to predicated right, start we of goal liquidity? now able are to or we to get I in thereof, we some All the huge

the those goes with of right. ultimately should on continuing we this latter the partner the and half we as of combination that. will those organic We things, renewable all year as execute along believe We then, diesel then next expect to then benefit We refinancing assume project. with delivering be let's planned, in a from, that we of have the the associated would year, into address to continue,

QX things closer a a of changed that, with dollars, of significantly pieces lots to laid all since Our are year year billion where of moving the ultimately a trending significantly out of EBITDA business kind XXXX. north is we versus in were achieve to the we strategy. a have middle for have There That's XX part XXXX. trial, ago, trailing a of of but that's right months that everything

is really to attention biggest now price us effort on is focus with execute, a markets help difficult continuing to the obviously have the in go cash forward. on it's to as sit right refinancing both forward flow, the along But is. free going that with piece to and share generating our to we organic this that deleveraging that go anything strategy will say capital pay where here we're basis. the think ultimately, do I We

helpful. you're other then XQ, was on Thank supply may in you. like It from year follow-up demand Great, really which start strong that's terms of real here, just And the balances some we a seems what in operators there curious just had Coast, downtime West time as really the quarter. been the in but California. seeing have

case, because some were But slowed particularly the does It's fact, a But said benefited and the spread already fundamentals fourth folks crew all around little And the other quarter, event including refinery California that very we day. them, recovered. first rode was tight West are shut The Martinez normally about, sit And are longer as is some cracks weather differentials We rain at or here in very this started in there. down et west by demand that between shutdown overriding a have hit things been very issues. some day we the was refinery out and or through have it no Pacific Brent but factor Those there a The always clear, issues the capacity And the cetera Well recovered, fortunately, in half. code. talked Avon Yes, the the because Bay has they proud of I'm often the and and It in California. past it's ANS to refinery in They're the down here in that there that's converted is you strong. bit Area. as renewables. quarter long have out it Coast today, there coast. XXX on in a market we've as was recovered. better California. folks obviously, Northwest. severe the all the

the say last they're good, demand. less Coast, West efficiency, And is in availability, five their got piece and on auto would no complexity are I the of strong certainly, in question you've the if refineries power. terms in refineries So, California top

I that color. appreciate

you. Thank

of We Lynagh Connor Morgan from with the ahead. have Stanley. question next line Please go

at what light by question we types from partners read to of to considering discussions see the return I with markets. a time comments that in wanted what that I equity to guess around on your you suggest offered you'd to of this the Yes, would the economics to question what you're and structures desire I that Are Chalmette. I'm thanks. guess, you're side? and of discussing you're terms basically, just and to partner the contemplating that just bring that our in favorable is equity your not public be on type curious, looking

XX months significant difficult an if a PBF different our The to the up internally, what And ago, joint a exact of financial from has over a feedstock we've is down time, it's in think ultimately back position. in of More our what only seen we've of be it using up we've had steam variety a pick seen was but not past on seen a months to really who what everything go forward de-risked structures. to Clearly ended seen we've different We've over ventures. amount internally. recently, of XX project/structured at project one finance. I peers, structure when variety pin us. we continued started coming right, call project capitalizing this was market project uncertainty seen

things. have But million different where So, go. things not structure to to these ways a some overall I we say on internal views think there's can

type us do not thing sure We as are We involve making but structure can do what years of helps ultimately being partner over we we comments. There's and be in are where same there of It financial expect PBF same different It comes partner Logistics believe that federally within structure well. finance. a could terms structured. some only the we variety are be the will funded of a have that of well. to be whether equity do it and could couple believe for Matt's At strategic we in optimizing programs. one right the could next Those the that fits the time, there two is end partners partner. thing could involve today, the as avenues, this a simply ways in other up where

most think thing piece the final I That's important going fit months. of frankly, advisor a having to this why next financial be for of the the that's assistance six the make as of puzzle kind quite we over together. us

Understood were feedstock have to there. you to the need alluding and flexibility

pillar Do in think favor feedstock of be partnership? a going project you Just sort to necessary strategic the you returns? are of some that's of confirming,

a believe it's necessary step. very certainly efficiency We're think in could but will our in to economic the a maximize well don't I acquire come feeds, the capability the No. necessary. acquiring looking partnership, with we that to have most feed

there's the up staff but and requirement. capabilities We specific some work market specifically the have year next tangentially our more the to of around been over no feeds, on

I context. right, it appreciate All the I'll turn back.

Thank you.

have the go We with of line question Sachs. Karl Please Goldman ahead. Blunden from next

the capital structure. for time and the Thanks morning. good Hi, the on color

time, the flexibility and securities the over secured is think with can company cap itself, improved opening covenants you that on do up to they've about some share of you'd way. mix performance, both some the bonds like stack. in you limit on the that and you options the there When more bonds unsecured some With come something between

becoming I'd So, interested the be later just in this coupon -- especially year? with securities high that callable those

believe message I be on an to of tranche of to front In that raise opportunity simply raised to was going absolutely on XXXX another expected. that the 'XX. in because did We we the for anyone December oversize PBF pandemic that proved is ultimately with insurance right saw XXX we end the the an originally decision longer billion-dollar our it hindsight, May think secured than relatively back first and when we of went consistent notes policy.

We within cap business a long-term cap We've to So, changed. outlined have to again debt to net from a policy our going we're to XX% gone have rating now in of our just is to improve. money time, that year but over where inherent all an losing to continues as of has position covering is investors Again, deleveraging ago This number. and some fixed going with insurance market re-maneuvering the inside to stack, the we time. being day-to-day get our policy sum. our it's around take Again, understand we what plus and of not have again sheet balance back view insurance we the we that's that, that operations. to we're to cash, goal only lot is come not will agencies sitting that on awful an for costs are carrying need don't an an

fully goal to Our get traded be will a publicly way environment unsecured believe appropriate is term business. a back a longer refining for independent structure in GAAP to regular We structure. that the

be about some when terms That's a you that all to this take in really would spoke potentially decision fully market, levels, that at long back what how you do and at little to the do of up do bit -- coming ramp Paulsboro when decision, back, and that have if a pre-COVID make we sense make bring a capacity you once would but of point? the helpful. cost you looking you're Erik, and

regards in would clarity. considering. would It to can starting obviously to not And want And that the just that come the that at this shut some anyone moment, It was that's thing equipment listening process months. There the major call we not take to we're reevaluate so we're we idea would we're extraordinary work there's the the At moment, a down. with away sticking preserve the be of but done, couple we be But the in I equipment. what capital. to don't have.

very thanks Understood, much.

you. Thank

with Gabelman from line We ahead. Cowen. question the the have next of Jason Please go

be timeline due maybe ask my good the I in My the 'XX. for cash due outlays the forward. won't program taking on you outlay Thanks the Could the XXXX RFS and until moving cash both XXXX, Yes, current XXXX, just for maybe government and to there first based of the then kind another wanted two morning. that, understanding questions. is just it about least to RIN on timing the said diesel those back the renewable progressing weakened. markets, follow-up equity the you diesel And elaborate past like, over been just seems yearly project, is of payments? renewable support in on equities has you've And the Chalmette year. it around at confirm the obligation

project? any interest in And with been potential Thanks. so, enthusiastic characterization less; can going Over that more your the have type past more would how the interest helpful? been characterize have be the has less, you year, or of you is, or seen question partners conversations

year. it talking idea. a think diesel when over I was to it ago, of We've last the were and Much Erik more we progress year an renewable about theoretical tremendous project. alluded the

like the he said, is all We've putting permitting complete, all done. started the ground. the so, is And pilings engineering into

And much real. more so, becoming it's

credits, mentioned advantages at is have of [indiscernible] but that form the involvement of In diesel. I And and rest end a to there come government margin as not the terms be going preference of of obviously view you the you going in believe, to an before, have and the only itself, that does a this And manufacture it's tax incentivised And marketplace, can country, renewable the but to have the world. we you're to puts the position, our be our we position. as not payment, the any you of the of to incentive renewable day, the manufacture marketplace company, us there I, in advantageous it. we well-positioned that probably strengths it, program to going in to price been we be timing requirements. live general that's market believe a regards course diesel. one RINs, political going the we're a projecting forward, it think but stated broken, is doesn't have due And any up RINs of very it's program to have aspect program. bring its as to have to of one we're to And going considering LCFS of all In or incentivised,

So, due rule out. because on is guess, comes when the the when payments depend anyone's are final it'll

on on was has rule where But it. to they a comments then out, recommendation. And to remember come came final yet may we the that will think took have and You the that's they previously what reasonable -- out propose. a depend deadlines what out. there of completely comes ultimate chance that which the is reconsider final But rule RVO they timing will the when depend,

could of some possible the time. come possible end if be it's that it's doesn't this XXXX, the the So, pushed be it year, at for rulemaking could but out final

something put So, they I December out, the they if if actually is to this maybe spring, do think it XX X, you but know. when let out stuck find me

California. only The Chalmette is note other large has are infrastructure, every only of hydrogen, We the steam, note situ are in proprietary strategically very available other is, we the own have LCFS equipment, our with We're thing extremely in et idled with program; cetera. in end renewable true in the But operator California. it that system we also LCFS we benefit well this really to domestic should able control just a day. large distribution of advantage essentially on take here of as to too the make we diesel market industrial located, not

product believe Europe other market at will of Mexico as based we will kind we will coming New is largest the only can on important disposition point. bring looks We're do? the side think consumers overall But can California, assets in already of process of to team through through up producing on And, perspective, need believe be a of we we side execution. Canada the have the point things. good today we be California. there frankly, It we distribute projects, as added diesel are in things market not an chain quite again, the is do at well. chain of what mentioned from as feedstock some the value again, only Matt supply the what think of that at have where capital good in, of So, is our of well. an if we're we when We today. we there one stuff, today, That's not an markets. product renewable control coming. we when which through, is this be we staffing available advantage state

questions? Mr. Gabelman, do you have further any

No, it me. from that was Thanks.

you. Thank

line final Blair with go have ahead. the Tudor, Pickering, question Matthew We Please of a from Holt.

Hey, taking end question. good I'll morning, my with and here. just thanks one for

either diesel. a market. state data renewable the QX had So, LCFS was the biodiesel or question consumed XX% on about California showed of I The diesel that in

you diesel XXX% I so or and they diesel guess, markets, or for have export question place the to is, or Canada my their to, in are And state some still able of of Mexico? production Martinez, are new Torrance to had look the Singapore

the No, all selling out diesel of our on West those of refineries Coast. we're two

Great, you. thank

you. Thank

We have end of the question-and-answer reached turn would And the to to Over closing now, remarks. to session. Nimbley the call I for Tom like over you.

thank and the to you, next clarity We call Thank on day. today. great forward a renewable everybody priorities, updates key and we including you the our call and progress give our for diesel project. deleveraging hope on to attending Everybody further with have the you, where look

at This much. your concludes this very you time. disconnect you your participation. may conference. for lines today's now Thank Thank you And