Par Pacific Holdings (PARR) risk factors, FY2024 10-K

Other

1. 01Our operations are subject to operational hazards that could expose us to potentially significant losses
2. 02The volatility of crude oil prices and refined product prices and changes in the demand for such products may have a material adverse effect on our cash flow and results of operations
3. 03Instability in the global economic and political environment can lead to volatility in the cost and availability of crude oil and prices for refined products, which could adversely impact our results of operations
4. 04Geopolitical conflicts, including the conflict between Russia and Ukraine, could increase the cost of our crude oil feedstocks and affect the demand for our products
5. 05Many of our refined products could cause serious injury or death if mishandled or misused by us or our purchasers, or if defects occur during manufacturing
6. 06Our business is impacted by increased risks of spills, discharges, or other releases of petroleum or hazardous substances in our refining and logistics operations
7. 07Our operations, including the operation of underground storage tanks, are also subject to the risk of environmental litigation and investigations which could affect our results of operations
8. 08Our insurance coverage may be inadequate to protect us from the liabilities that could arise in our business
9. 09We are subject to interruptions of supply and increased costs as a result of our reliance on third-party transportation of crude oil and refined products to and from our refineries
10. 10The financial and operating results of our refineries, including the products they refine and sell, can be seasonal
11. 11We rely upon certain critical information systems for the operation of our business and the failure of any critical information system, including a cybersecurity breach, may result in harm to our business
12. 12Climate change may increase the frequency and severity of weather events that could result in severe personal injury, property damage, and environmental damage, which could curtail our operations and otherwise materially adversely affect our cash flows
13. 13Through our investment in Laramie Energy, we are subject to all of the risks of natural gas and oil exploration and production, but we lack the ability to control Laramie Energy’s operations and our ability to extract value is limited

REGULATORY RISK

1. 14Meeting the requirements of evolving environmental, health, and safety laws and regulations, including those related to climate change and marine protection, could adversely affect our performance
2. 15Renewable fuels mandates and other mandates may reduce demand for the petroleum fuels we produce, which could have a material adverse effect on our business results of operations and financial condition
3. 16Potential legislative and regulatory actions addressing climate change could increase our costs, reduce our revenue and cash flow from operations, or otherwise alter the way we conduct our business
4. 17to reporting of GHG emissions in the U.S. These EPA policies and rulemakings could adversely affect our operations and restrict or delay our ability to obtain air permits for new or modified facilities
5. 18Regulatory and other requirements concerning the transportation of crude oil and other commodities by rail may cause increases in transportation costs or limit the amount of crude oil that we can transport by rail
6. 19We will be required to undertake significant environmental remediation and other corrective actions in connection with certain prior acquisitions
7. 20We may incur significant costs and liabilities resulting from performance of pipeline integrity programs and related repairs
8. 21Compliance with and changes in tax laws could materially and adversely affect our financial condition, results of operations and cash flows
9. 22Tariffs may adversely affect our financial condition, results of operations, and cash flows

BUSINESS RISKS

1. 23The locations of our refineries and related assets in certain limited geographic areas create an exposure to localized economic risks
2. 24The retail market is diverse and highly competitive. Aggressive competition and the development of alternative fuels could adversely impact our business
3. 25If we are unable to obtain crude oil supplies for our refineries without the benefit of our Inventory Intermediation Agreement and ABL Credit Facility, the capital required to finance our crude oil supply could negatively impact our liquidity
4. 26The Inventory Intermediation Agreement expose us to counterparty credit and performance risk
5. 27Inadequate liquidity could materially and adversely affect our business operations in the future
6. 28Our ability to generate cash and repay our indebtedness or fund capital expenditures depends on many factors beyond our control and any failure to do so could harm our business, financial condition, and results of operations
7. 29We have a substantial amount of indebtedness, which requires significant interest payments. As of December 31, 2024, we had $1.1 billion of indebtedness and Interest expense and financing costs, net for the year ended December 31, 2024, was $82.8 million
8. 30Despite our current debt levels, we may still incur substantially more debt or take other actions which would intensify the risks associated with our substantial leverage
9. 31Our debt agreements impose significant operating and financial restrictions on us
10. 32We may incur losses and incur additional costs as a result of our forward-contract activities and derivative transactions
11. 33Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly and otherwise impact our ability to incur indebtedness for acquisitions and working capital needs
12. 34We cannot be certain that our net operating loss tax carryforwards will continue to be available to offset our tax liability
13. 35We may be unable to successfully identify, execute, or effectively integrate future acquisitions, which may negatively affect our results of operations
14. 36Acquisitions may prove to be worth less than we paid because of uncertainties in evaluating potential liabilities
15. 37A substantial portion of our refining workforce is unionized and we may face labor disruptions that would interfere with our operations
16. 38Changes in the availability of and the cost of labor could adversely affect our business
17. 39Technological change or adverse changes in global economic conditions could affect the demand for transportation fuels and impact our business and financial condition in ways that we currently cannot predict

RISKS RELATED TO OUR COMMON STOCK

1. 40Because we have no near term plans to pay cash dividends on our common stock, investors must look solely to stock appreciation for a return on their investment in us
2. 41If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our common stock, or if our operating results do not meet their expectations, our stock price could decline
3. 42The price of our common stock historically has been volatile. This volatility may affect the price at which you could sell your common stock
4. 43An impairment of an equity investment, a long-lived asset, or goodwill could reduce our earnings or negatively impact the value of our common stock
5. 44The market for our common stock has been historically illiquid, which may affect your ability to sell your shares
6. 45Delaware law, our charter documents, and concentrated stock ownership may impede or discourage a takeover, which could reduce the market price of our common stock
7. 46We may issue preferred stock with terms that could adversely affect the voting power or value of our common stock and any future issuances of our common stock may reduce our stock price
8. 47Investor sentiment towards climate change, fossil fuels, sustainability, and other Environmental, Social, and Governance (“ESG”) matters could adversely affect our business and our stock price