Who We Are Worlds Largest Independent Refiner 15 refineries, 2.9 million barrels per day (BPD) of high-complexity throughput capacity Greater than 70% of refining capacity located in U.S. Gulf Coast and Mid-Continent Approximately…
Assets Concentrated in Advantaged Locations Capacities (MBPD) Nelson Refinery Throughput Crude Oil Index Corpus Christi 325 205 19.9 Houston 165 90 15.1 Meraux 135 135 10.3 Port Arthur 350 330 12.6 St. Charles 280 190 17.5 Texas City…
Strategy to Enhance Stockholder Returns Demonstrate commitment to safe and reliable operations Operations Continuously improve our top-tier operating performance Excellence Optimize margins with refining systems feedstock and…
Key Market Trends U.S. and Canadian crude oil, natural gas, and natural gas liquids (NGLs) production growth is providing cost advantages to North American refiners - Lower crude prices may temporarily constrain production growth…
Production Growth Provides Resource Advantage to North American Refiners U.S. Crude Oil Production and U.S. Natural Gas Production MBPD Imports MBPD (Bcf/day) 10,500 9,000 70 Imports 10,000 8,500 Production 65 8,000 9,500 7,500…
Persistent Focus Drives Results in Safety, Operations Excellence Environmental, and Regulatory Compliance Personnel Safety Tier 1 Process Safety Environmental Events 1.8 40 20 0.20 Total Recordable Incident Rate (TRIR) 1.6…
Top-Tier Operating Performance through Continuous Improvements Reliability drives safe and 1st Quartile profitable operations 2012 2010 Seven of our refineries are first 2nd Quartile 2008 quartile in mechanical availability…
Reliability Programs and Commercial Optimization Drive Higher Utilization Rates Valero Refinery Utilization Rates System-wide mechanical availability near 1st Quartile since 2011 95% 96% 92% 88% 87% 2010 2011 2012 2013…
Optimizing Margins with Feedstock Flexibility in Our Complex Refinery System Range of Flexibility in Valeros Gulf Coast Region Quarterly Feedstock Mix 2010-2014 Capability to adjust 35% feedstocks and optimize 34% margins as…
Port Arthur and St. Charles Hydrocrackers Performing Better Than Expected 120 MBPD of combined new capacity successfully started end of 2012 and mid-2013 Designed to produce high-quality distillates from low-quality feedstocks and…
Disciplined Capital Allocation Capital Returns to Framework Emphasizes Stockholders Stockholders Non-Discretionary Sustaining Capex Dividend Growth Debt and Cash Estimate 1.5 billion or Focus on sustainability Maintain…
Increasing Focus on Dividends and Stock Buybacks Regular dividend increases over Dividend Per Share of Valero 0.30 last three years 0.25 Significantly increased stock 0.20 buybacks in 2013 and 2014 0.15 Accelerated stock…
Advancing Growth Investments While Disciplined Capital Managing Capital Spending Lower Investment millions 2,900 2,650 900 400 2,400 Logistics Growth 715 790 690 Refining, Renewables, & 300 Other Growth (1) 695 655 695…
Logistics Investments Enhance Valeros Feedstock Flexibility and Export Capability Pipelines Completed tie-in to pipeline in Childress, TX and secured incremental 40 to 50 MBPD Midland-priced crude as substitute for Cushing-priced…
Crude Topper Investments Very Attractive 160 MBPD new topping capacity Combined Projects Estimates designed to process up to 50 API Total investment(1) 750 MM domestic sweet crude Annual EBITDA contribution(2) 500 MM Lowers…
Key Natural Gas and NGLs Upgrading Investments Increase distillate yield partially from hydrogen via natural gas Completed Merauxs 20 MBPD capacity expansion in 4Q14; Hydrocracker expect approximately 90 million annual EBITDA…
Ethanol Investments Performing Well 11 plants acquired between Cumulative Capex and EBITDA 2Q09 and 1Q14 for millions Excellent 794MM, less than 35% of replacement value 2,058 Acquisitions 1.3 billion gallons total annual…
Our Sponsored MLP Unlocking Asset Value Valero Energy Partners (NYSE: VLP) Valero owns entire 2% general partner interest, all incentive Growth-oriented distribution rights, and 68.6% LP interest logistics MLP with High-quality…
Significant Growth Opportunity with Estimated Inventory of Eligible MLP Assets EBITDA over 900 Million Pipelines(1) Over 1,200 miles of active pipelines Expect start-up of 440-mile Diamond Pipeline from Cushing to Memphis refinery…
We Believe Valero Is an Excellent Investment Majority of capacity located in U.S. Gulf Coast and Mid- Continent with access to cost-advantaged crude, natural gas, NGLs, and corn Proven operations excellence Excellent investment and…
Appendix Topic Pages Valero 2014 Highlights and 2015 Goals 24-25 Valero Energy Partners LP and CST Brands Spinoff 26-28 Capital Spending and Key Investment Details 29-38 Other Valero Operations Highlights 39-44 Macro Outlook and Key…
Key 2014 Highlights Operations Excellence Achieved record system refinery capacity utilization of approximately 96% in 2014 through 3Q Increased consumption of price-advantaged North American light sweet crudes by 297 MBPD on average…
Key 2015 Goals Operations Excellence Start up Montreal crude terminal with startup of Enbridge Line 9B reversal and lower Quebec refinerys crude costs versus Brent compared to 2014 Grow product export market share and increase…
Growth in Inventory of Estimated Eligible MLP EBITDA millions 54 909 46 24 800 (15) Dec. 2013 Drop-Downs 2014 - 2015 Diamond Pipeline 2016 - 2019 Current Guidance Guidance (with Logistics Logistics Projects base +…
VLP Nearing the High Splits Marginal Percentage Interest in Distributions Target Quarterly Distribution per Unit Unitholders GP Minimum quarterly 0.2125 98% 2% First target above 0.2125 up to 0.244375 98% 2% Second target…
Unlocked Value via Retail Spinoff in 2013 CST Brands, Inc. (NYSE: CST) has traded at approximately double the earnings valuation of VLO VLO received nearly 1 billion in cash net of tax liability and working capital benefit to CST…
Allocating Significant Growth Capital to Logistics millions 900 170 715 5 Marine, Docks, and Other Logistics 220 400 Pipelines and Tanks 45 665 510 180 175 Railcars and Unloading 45 2014E 2015E 2016E Railcars…
Refining & Renewables Capital Focused on Capturing Benefits of Key Long-Term Trends millions 790 40 690 45 150 Nat Gas & Petchems 120 110 Other Projects 180 300 Hydrocracking 490 115 345 105 Advantaged Crude 30…
McKee Diesel Recovery Improvement and CDU Expansion Startup Expected in 2H15 Project Estimates Investment Highlights Total investment 140 MM Adding 25 MBPD crude unit capacity Annual EBITDA contribution(1) 100 MM and parallel light…
Meraux Hydrocracker Conversion Completed December 2014 Project Estimates Investment Highlights Total investment 260 MM Converted hydrotreater into high- Annual EBITDA contribution(1) 90 MM pressure hydrocracker and Unlevered IRR…
Houston and Corpus Christi Crude Topping Units Expected Online in 1st Half of 2016 Houston Corpus Christi Houston Estimates Incremental Volume (MBPD) Estimates Incremental Volume (MBPD) Feeds Feeds Eagle Ford crude 90 Eagle Ford…
Diamond Pipeline Investment Highlights Project Estimates Total investment(1) 484 MM Increases Memphis refinerys crude Cumulative spend through 2014 Zero supply flexibility via connection to Annual EBITDA contribution(2) 46 MM…
Estimated Key Price Sensitivities on Project Economics McKee Diesel Corpus Change in Estimated EBITDA(1) Relative to 2014(2) Prices Recovery & CDU Meraux HCU Christi Houston (millions/year) Expansion Expansion Topper Topper ICE Brent,…
Port Arthur and St. Charles Hydrocrackers Performance Details Benefits Realized in Reported Results Trailing 4 Quarters mm, except /bbl amounts 4Q12 3Q14 Increase Gulf Coast Capture Rate 58.8% 63.2% 4.4% x Gulf Coast Indicator/bbl,…
Gated Investment Management Process PHASE 1 PHASE 2 PHASE 3 PHASE 4 APPROVED Opportunity Lead Case Refinement Execution Startup and Evaluation Development Define project Detail Evaluate Identify Select lead case scope and engineering,…
Valeros Light Crude Processing Capacity in North America MBPD McKee Crude Unit Expansion 25 MBPD additional capacity expected in 2H15 Distillate recovery improvements Houston Crude Topper 90 MBPD capacity expected 1H16 1,395…
Processing of Cost-Advantaged U.S. and Canadian Crude by Valero Continues to Grow MBPD MBPD 1,200 1,600 1,400 1,000 1,200 800 1,000 600 800 600 400 400 200 200 0 0 2010 2011 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14…
Valero Leads Peers in Total Location- Advantaged Crude Capacity MBPD 1,934 1,714 Canada U.S. Gulf Coast 1,211 U.S. Midcontinent 443 129 VLO MPC PSX HFC TSO Source: Company 10-k reports. Crude distillation capacity…
Expect Quebec City Refinery to Have Cost-Advantaged Access to 100% North American Crude Slate in 2015 Quebec City Refinery Crude Slate 100% 80% Foreign Imports 60% North American 40% 20% 0% 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14…
U.S. Natural Gas Provides Opex and Feedstock Cost Advantages Valeros refining operations consume approximately 860,000 mmBtu/day of natural gas, split almost equally between operating expense and cost of goods sold Significant…
Valeros Capacity for Additional Product Exports Export markets pull volume from Valeros U.S. Product Exports U.S., enabling high refinery (MBPD) 700 utilization and improved margins 600 Gasoline Diesel Supported by global…
Long-Term Macro Market Expectations Economic activity and total petroleum demand increases Transportation fuels demand grows Global Outlook Refining capacity growth slows after 2015; utilization stabilizes then expected to increase…
U.S. and Canadian Production Growth Provides Crude Cost Advantage to North American Refiners U.S. and Canadian Crude Production vs. U.S. Crude Imports MMBPD 18 Largest growth from U.S. shale crude and heavy 16 Canadian crude 14…
Estimated Crude Oil Transportation Costs Alberta to Eastern Canada Rail 11 to 12/bbl Rail 9/bbl Alberta to Bakken 1 to 2/bbl U.S. Ship Bakken 4 to USGC to Canada 5/bbl Foreign Ship 2/bbl to USEC to West Coast Rail 12 to Rail…
Valeros Regional Refinery Indicator Margins /bbl 25 20 15 10 Midcontinent WTI Cracking West Coast ANS Medium Sour Coking North Atlantic Brent Cracking Gulf Coast Heavy Sour Coking 5 2004 2005 2006 2007 2008 2009…
Valeros Regional Indicator Margins Defined Gulf Coast Indicator: (GC Colonial 85 CBOB A grade- LLS) x 60% + (GC ULSD 10ppm Colonial Pipeline prompt - LLS) x 40% + (LLS - Maya Formula Pricing) x 40% + (LLS - Mars Month 1) x 40%…
Low Cost U.S. Natural Gas Provides Competitive Advantage U.S. natural gas is significantly discounted to Brent on an energy equivalent basis Prices expected to remain low and disconnected from global oil and gas markets for…
Global Petroleum Demand Projected to Grow Emerging markets in Latin America, Middle East, Africa, and Asia lead demand growth World Petroleum Demand Growth MMBPD 3.5 2.5 1.5 0.5 -0.5 -1.5 -2.5 Non-OECD OECD (excl.…
U.S. Refining Capacity Is Globally Competitive and Continues to Take Market Share U.S. flipped from importer to exporter on lower local product demand and higher refinery utilization, particularly in PADDS 2, 3, and 4, driven by…
World Refinery Capacity Growth New capacity additions expected in Asia and Middle East Announced new capacity in Brazil, Mexico, and Colombia likely to be smaller and start later than planned Expansions in Ecuador, Peru, Algeria, and…
Capacity Rationalization in Atlantic Basin Marginal refiners in U.S. East Coast, Caribbean and Western Europe are shutting capacity Demand growth, poor reliability, and low utilization in Latin American refineries provide…
Global Refining Capacity Rationalization CDU Capacity Year CDU Capacity Year Location Owner Closed (MBPD) Closed Location Owner Closed (MBPD) Closed Perth Amboy, NJ Chevron 80 2008 St. Croix, U.S.V.I Hovensa 350 2012 Bakersfield,CA Big…
Global Refining Capacity For Sale or Under Strategic Review Location Owner CDU Capacity (MBPD) Lytton, Australia Caltex 109 Nishihara, Japan Petrobras/Sumitomo 95 Inchon, Korea SK Energy 270 Whitegate, Ireland Phillips 66 71 Barbers…
U.S. Crude Fundamentals U.S. Crude Inventory (MB) 400,000 390,000 380,000 370,000 360,000 350,000 340,000 330,000 5 Yr High 5 Yr Low 2012 2013 2014 5 Yr Avg 320,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 55,000 Cushing…
U.S. Gasoline Fundamentals USGC Brent Gasoline Crack (per bbl) 9.4 U.S. Gasoline Demand (mmbpd) 25 20 9.2 15 9.0 10 5 8.8 0 8.6 -5 8.4 -10 -15 8.2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep…
U.S. Distillate Fundamentals USGC Brent ULSD Crack (per bbl) U.S. Distillate Demand (mmbpd) 25 4.4 4.2 20 4 15 3.8 10 3.6 5 3.4 0 3.2 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov…
U.S. Transport Indicators U.S. VMT Growth vs. Gasoline Demand Growth Airline Traffic Indicators U.S. Gasoline Demand Growth 3.5 International U.S. VMT Growth 3.0 Domestic 85% Source: U.S. DOE PSM / U.S. DOT FHA 5.0% Most recent…
U.S. Transport Indicators: Trucking ATA Seasonally Adj Truck Tonnage Index ATA Non-Seasonally Adj Truck Tonnage Index 135 145 Current Year Current Year 130 12-Mth Moving Avg 135 12-Mth Moving Avg 125 125 Index, 2000 = 100…
Increase in U.S. Gasoline Exports 700 12 Month Moving Average, MBPD Other 600 Europe 500 Other Latin America Mexico 400 Canada 300 Latest 4 Wk avg estimate (Finished only) 200 100 0 2005 2006 2007 2008 2009 2010 2011…
Decrease in U.S. Gasoline Imports 12 Month Moving Average, MBPD Other 1400 Europe 1200 Other Latin America 1000 Canada 800 Latest 4 Wk avg estimate (Fin+Blendstock) 600 400 200 0 2005 2006 2007 2008 2009 2010 2011 2012…
Increase in U.S. Diesel Exports 1400 12 Month Moving Average, MBPD 1200 Other 1000 Europe Other Latin America 800 Mexico Canada 600 Latest 4 Wk avg estimate 400 200 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014…
U.S. Is Net Refined Products Exporter Valeros share of U.S. exports has averaged 20% to 25% over the past few years MMBPD 21 U.S. Demand for Refined Products and Net Trade 20 U.S. Petroleum Demand Excluding Ethanol and Non-Refinery…
U.S. Shifted to Net Exporter Net refined products exports increased from 335 MBPD in 2010 to 2,426 MBPD in 2014 Diesel net exports averaged 917 MBPD in 2014 (Jan-Sep) Gasoline net imports averaged -31 MBPD in 2014 (Jan Sep) Gasoline…
U.S. Growing Market Share by Exports Refined products demand is growing in developing countries and Atlantic Basin (capacity closures) U.S. Gulf Coast (PADD III) is the largest source of exported products MMBPD U. S. Product…
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