What the changes say
- Delek Logistics Partners added specific climate and fracking regulations.
What changed since the prior 10-K
New
- New
In the United States, no comprehensive climate change legislation has been implemented at the federal level
Federal and state climate change regulations, including U.S. withdrawal from the Paris Agreement, could increase compliance costs and reduce fossil fuel demand.
- New
Further, several federal governmental agencies have conducted reviews and studies on the environmental aspects of hydraulic fracturing, including the EPA. The results of such reviews or studies could spur initiatives to further regulate hydraulic fracturing
Regulations addressing induced seismicity from injection disposal wells and hydraulic fracturing could restrict customer operations and impact leasing on federal lands.
Dropped
- Dropped
A direct attack on our assets, or the assets of others used by us, could have a material adverse effect on our business, financial condition and results of operations
Reworded
- 92% rewritten
Climate change legislation or regulations restricting emissions of greenhouse gases could result in increased operating and capital costs and reduced demand for our products and services
Removed language referencing specific U.S. re-entry into the Paris Agreement.
- 74% rewritten
Increased regulation of hydraulic fracturing could result in reductions or delays in customer production, which could materially adversely impact our revenues
No substantive textual changes made to the hydraulic fracturing risk.
- 68% rewritten
Acts of terror or sabotage, threats of war, armed conflict or war may hinder or prevent us from conducting our business
No substantive textual changes made to the acts of terror and Israel connection risk.
- 26% rewrittenRisks Relating to Our Partnership Structure
Even if holders of our common limited partner units are dissatisfied, they cannot remove our general partner without its consent
Updated Delek Holdings ownership stake from 63.6% as of February 20, 2025 to 63.3% as of February 20, 2026.
All 70 risk factors
Headings as the filing states them, in filing order.
Other
- 01Our relationship with Delek Holdings and their financial condition subjects us to potential risks that are beyond our control
- 02Developments which impact the global oil markets have had, may continue to have, an adverse impact on our business, our results of operations and our overall financial performance
- 03Like the COVID-19 Pandemic, a regional or global disease outbreak could result in financial and operational impacts that have a material adverse effect on our business, financial condition, results of operation and liquidity
- 04We may be unsuccessful in integrating the operations of the assets we have acquired or may acquire with our operations, and in realizing all or any part of the anticipated benefits of any such acquisitions
- 05Our insurance policies and contractual protections from Delek Holdings do not cover all losses, costs or liabilities that we may experience, and insurance companies that currently insure companies in the energy industry may cease to do so or substantially increase premiums
- 06The physical effects of climate change and severe weather present risks to our operations
- 07If we are unable to generate sufficient cash flow, our ability to pay quarterly distributions to our common unitholders at all or at current levels or our ability to increase our quarterly distributions in the future could be impaired materially
- 08The Russia-Ukraine War, Israel-Hamas War, events occurring in response thereto and any expansion of hostilities, may have an adverse impact on our business, our future results of operations, and our overall financial performance
- 09Further, certain of our pipeline facilities are subject to the pipeline safety regulations of the PHMSA. The PHMSA regulates the design, construction, testing, operation, maintenance, reporting and emergency response of crude oil, petroleum products and other hazardous liquid pipeline facilities
- 10A material decrease in wholesale fuel margins or in the quantity of barrels sold to wholesale customers could adversely affect our financial condition, results of operations, cash flows, ability to service our indebtedness and ability to make distribution to unitholders
- 11Our counterparties have discretion in certain circumstances to decide to suspend, reduce or terminate their obligations under our commercial agreements notwithstanding the fact that their decisions may significantly and adversely affect us
- 12There are certain environmental hazards and risks inherent in our operations that could adversely affect those operations and our financial results
- 13A portion of our operations are conducted through joint ventures, over which we do not have full control and which have unique risks
- 14We are exposed to direct commodity price risk and interest rate risk, both of which may increase in the future. We may incur losses as a result of our forward contract activities and derivative transactions
- 15Our ability to expand may be limited if Delek Holdings’ business does not grow as expected
- 16We may not be able to significantly increase or retain our third-party revenue due to competition and other factors, which could limit our ability to grow and may increase our dependence on Delek Holdings
- 17A shortage of skilled labor or disruptions in our labor force may make it difficult for us to maintain labor productivity
- 18If we are unable to obtain needed capital or financing on satisfactory terms to fund expansions of our asset base, our ability to make quarterly cash distributions may be diminished or our financial leverage could increase
- 19An interruption or reduction of supply and delivery of refined products to our wholesale marketing business could result in a decline in our sales and profitability
- 20Restrictions in our revolving credit facility and in the respective indentures governing the 2028 Notes, 2029 Notes and 2033 Notes could adversely affect our business, financial condition, results of operations and ability to make quarterly cash distributions to our unitholders
- 21Our debt levels may limit our flexibility to obtain financing and to pursue other business opportunities
- 22Increases in interest rates could adversely impact the price of our common units, our ability to issue equity or incur debt for acquisitions or other purposes and our ability to make cash distributions at our intended levels
- 23We do not own all of the land on which most of our pipelines and several of our facilities are located, which could result in disruptions to our operations
- 24We could incur substantial costs or disruptions in our business if we cannot obtain or maintain, or otherwise fail to maintain, necessary permits and authorizations or otherwise comply with health, safety, environmental and other laws and regulations
- 25We have not obtained independent evaluations of all of the reserves connected to our gathering systems; therefore, in the future, customer volumes on our systems could be less than we anticipate
- 26Certain of our gathering agreements contain provisions that can reduce that cash flow stability that the agreements were designed to achieve
- 27Climate change legislation or regulations restricting emissions of greenhouse gases could result in increased operating and capital costs and reduced demand for our products and services92% rewritten
- 28In the United States, no comprehensive climate change legislation has been implemented at the federal levelNew
- 29Our operations are subject to federal and state laws and regulations relating to product quality specifications, and we could be subject to damages based on claims brought against us by our customers or lose customers as a result of the failure of products we distribute to meet certain quality specifications
- 30Increased regulation of hydraulic fracturing could result in reductions or delays in customer production, which could materially adversely impact our revenues74% rewritten
- 31Further, several federal governmental agencies have conducted reviews and studies on the environmental aspects of hydraulic fracturing, including the EPA. The results of such reviews or studies could spur initiatives to further regulate hydraulic fracturingNew
- 32Increasing attention on environmental, social and governance matters may impact our business, financial results or stock price
- 33Acts of terror or sabotage, threats of war, armed conflict or war may hinder or prevent us from conducting our business68% rewritten
- 34Our customers’ operating results are seasonal and generally lower in the first and fourth quarters of the year. Our customers depend on favorable weather conditions in the spring and summer months
- 35Legislative and regulatory measures could have an adverse effect on our ability to use derivative instruments to reduce the effect of commodity price, interest rate and other risks associated with our business
- 36We rely on information technology in our operations, and any material failure, inadequacy, interruption, cyber-attack or security failure of that technology could harm our business
- 37We may be adversely affected by the effects of inflation
- 38Our business could be adversely impacted as a result of Delek Holdings’ and our general partner’s failure to retain or attract key talent
- 39An impairment of our long-lived assets or goodwill could reduce our earnings or negatively impact our financial condition and results of operations
- 40The Partnership's ongoing study of strategic options could materially impact our strategic direction, business and results of operations
- 41If our cost efficiency measures are not successful, we may become less competitive
Risks Relating to Our Partnership Structure
- 42Our general partner and its affiliates, including Delek Holdings, have conflicts of interest with us and limited duties to us and our unitholders, and they may favor their own interests to the detriment of us and our other common unitholders
- 43Our Partnership Agreement replaces the fiduciary duties that would otherwise be owed by our general partner with contractual standards governing its duties
- 44Delek Holdings may compete with us
- 45As a result, Delek Holdings has the ability to construct assets which directly compete with our assets. The limitations on the ability of Delek Holdings to compete with us are terminable by either party if Delek Holdings ceases to control our general partner
- 46If unitholders are not eligible holders, their common limited partner units may be subject to redemption
- 47Our Partnership Agreement requires that we distribute all of our available cash, which could limit our ability to grow and make acquisitions
- 48Our Partnership Agreement restricts the remedies available to holders of our common limited partner units for actions taken by our general partner that might otherwise constitute breaches of fiduciary duty
- 49The administrative services fee and reimbursements due to our general partner and its affiliates for services provided to us or on our behalf will reduce our cash available for distribution to our common unitholders. The amount and timing of such reimbursements will be determined by our general partner
- 50Holders of our common limited partner units have limited voting rights and are not entitled to elect our general partner or its directors
- 51Even if holders of our common limited partner units are dissatisfied, they cannot remove our general partner without its consent26% rewritten
- 52Our Partnership Agreement restricts the voting rights of unitholders owning 20% or more of our common limited partner units
- 53Our general partner’s interest in us and the control of our general partner may be transferred to a third party without unitholder consent
- 54We may issue additional units without unitholder approval, which would dilute unitholder interests
- 55Delek Holdings may sell units in the public or private markets, and such sales could have an adverse impact on the trading price of the common units
- 56Our general partner intends to limit its liability regarding our obligations
- 57Our general partner has a limited call right that may require our unitholders to sell their units at an undesirable time or price
- 58Our unitholders' liability may not be limited if a court finds that unitholder action constitutes control of our business
- 59Unitholders may have liability to repay distributions that were wrongfully distributed to them
- 60The NYSE does not require a publicly traded limited partnership like us to comply with certain of its corporate governance requirements
- 61The tax treatment of publicly traded partnerships or an investment in our common limited partner units could be subject to potential legislative, judicial or administrative changes and differing interpretations, possibly on a retroactive basis
- 62If we were subjected to a material amount of additional entity-level taxation by individual states, it would reduce our cash available for distribution to our unitholders
- 63If the IRS contests the federal income tax positions we take, the market for our common limited partner units may be adversely impacted and the cost of any IRS contest would likely reduce our cash available for distribution to unitholders
- 64Tax gain or loss on the disposition of our common limited partner units could be more or less than expected
- 65Tax-exempt entities and non-U.S. persons face unique tax issues from owning our common limited partner units that may result in adverse tax consequences to them
- 66We treat each holder of common limited partner units as having the same tax benefits without regard to the actual common limited partner units held. The IRS may challenge this treatment, which could adversely affect the value of the common limited partner units
- 67If the IRS makes audit adjustments to our income tax returns for tax years beginning after 2017, it (and some states) may collect any resulting taxes (including any applicable penalties and interest) directly from us, in which case our cash available for distribution to our unitholders might be substantially reduced
- 68As a result of investing in our common limited partner units, our unitholders may be subject to state and local taxes and return filing requirements in jurisdictions where we operate or own or acquire properties
- 69Compliance with and changes in tax laws could adversely affect our performance
- 70Unitholders may be subject to limitation on their ability to deduct interest expense incurred by us
Other Delek Logistics Partners 10-Ks
- FY2024 10-K risk factors69 risks
This is an initial filing with 69 risk factors detailing reliance on parent Delek Holdings, debt leverage of $1,885.4 million, and joint ventures.
Filed Feb 26, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.