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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
________________________________________________________________________________________________________________________

FORM 10-Q
________________________________________________________________________________________________________________________
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2024
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from to

Commission File No. 001-36550
________________________________________________________________________________________________________________________
PAR PACIFIC HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
________________________________________________________________________________________________________________________
Delaware84-1060803
(State or other jurisdiction of(I.R.S. Employer
incorporation or organization)Identification No.)
825 Town & Country Lane, Suite 1500 
Houston,Texas77024
(Address of principal executive offices)(Zip Code)
(281899-4800 
(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Common stock, $0.01 par valuePARRNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. 
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Securities Act.  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes      No  

57,937,921 shares of Common Stock, $0.01 par value, were outstanding as of May 6, 2024.




PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
TABLE OF CONTENTS



PART I FINANCIAL INFORMATION
Page No.
Item 1.
Item 2.
Item 3.
Item 4.
PART II OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
The terms “Par,” “Company,” “we,” “our,” and “us” refer to Par Pacific Holdings, Inc. and its consolidated subsidiaries unless the context suggests otherwise.



PART I - FINANCIAL INFORMATION 
Item 1. FINANCIAL STATEMENTS
PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except share data)
 March 31, 2024December 31, 2023
ASSETS  
Current assets 
Cash and cash equivalents$228,298 $279,107 
Restricted cash341 339 
Total cash, cash equivalents, and restricted cash228,639 279,446 
Trade accounts receivable, net of allowances of $0.2 million and $0.2 million at March 31, 2024 and December 31, 2023, respectively
448,479 367,249 
Inventories1,133,069 1,160,395 
Prepaid and other current assets48,320 182,405 
Total current assets1,858,507 1,989,495 
Property, plant, and equipment 
Property, plant, and equipment1,608,311 1,577,801 
Less accumulated depreciation and amortization(503,775)(478,413)
Property, plant, and equipment, net1,104,536 1,099,388 
Long-term assets 
Operating lease right-of-use (“ROU”) assets
341,405 346,454 
Refining and logistics equity investments88,315 87,486 
Investment in Laramie Energy, LLC18,842 14,279 
Intangible assets, net10,254 10,918 
Goodwill129,275 129,275 
Other long-term assets220,542 186,655 
Total assets$3,771,676 $3,863,950 
LIABILITIES AND STOCKHOLDERS’ EQUITY 
Current liabilities 
Current maturities of long-term debt$4,226 $4,255 
Obligations under inventory financing agreements662,688 594,362 
Accounts payable436,188 391,325 
Accrued taxes36,792 40,064 
Operating lease liabilities68,841 72,833 
Other accrued liabilities239,027 421,762 
Total current liabilities1,447,762 1,524,601 
Long-term liabilities 
Long-term debt, net of current maturities635,283 646,603 
Finance lease liabilities13,375 12,438 
Operating lease liabilities283,099 282,517 
Other liabilities80,818 62,367 
Total liabilities2,460,337 2,528,526 
Commitments and contingencies (Note 15)
Stockholders’ equity
Preferred stock, $0.01 par value: 3,000,000 shares authorized, none issued
  
Common stock, $0.01 par value; 500,000,000 shares authorized at March 31, 2024 and December 31, 2023, 59,070,467 shares and 59,755,844 shares issued at March 31, 2024 and December 31, 2023, respectively
590 597 
Additional paid-in capital872,954 860,797 
Accumulated earnings429,675 465,856 
Accumulated other comprehensive income8,120 8,174 
Total stockholders’ equity1,311,339 1,335,424 
Total liabilities and stockholders’ equity$3,771,676 $3,863,950 
 
See accompanying notes to the condensed consolidated financial statements.
1


PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended
March 31,
20242023
Revenues$1,980,835 $1,685,209 
Operating expenses  
Cost of revenues (excluding depreciation)1,747,478 1,289,020 
Operating expense (excluding depreciation)153,260 83,120 
Depreciation and amortization32,656 24,360 
General and administrative expense (excluding depreciation)41,755 19,286 
Equity earnings from refining and logistics investments
(6,094) 
Acquisition and integration costs243 5,271 
Par West redevelopment and other costs1,971 2,750 
Loss on sale of assets, net51  
Total operating expenses1,971,320 1,423,807 
Operating income9,515 261,402 
Other income (expense) 
Interest expense and financing costs, net(17,884)(16,250)
Debt extinguishment and commitment costs (17,720)
Other loss, net(2,576)(35)
Equity earnings from Laramie Energy, LLC4,563 10,706 
Total other expense, net(15,897)(23,299)
Income (loss) before income taxes(6,382)238,103 
Income tax benefit (expense)2,631 (213)
Net income (loss)$(3,751)$237,890 
Income (loss) per share
Basic$(0.06)$3.96 
Diluted$(0.06)$3.90 
Weighted-average number of shares outstanding  
Basic58,992 60,111 
Diluted58,992 61,047 
 

See accompanying notes to the condensed consolidated financial statements.
2


PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(in thousands)
Three Months Ended
March 31,
20242023
Net income (loss)$(3,751)$237,890 
Other comprehensive income (loss):
Other post-retirement benefits loss, net of tax(54)(11)
Total other comprehensive loss, net of tax(54)(11)
Comprehensive income (loss)$(3,805)$237,879 

See accompanying notes to the condensed consolidated financial statements.

3






PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended March 31,
 20242023
Cash flows from operating activities:  
Net Income (Loss)$(3,751)$237,890 
Adjustments to reconcile net income (loss) to cash provided by operating activities:  
Depreciation and amortization32,656 24,360 
Debt extinguishment and commitment costs 17,720 
Non-cash interest expense1,412 898 
Deferred taxes(2,631)67 
Loss on sale of assets, net51  
Stock-based compensation16,410 2,317 
Unrealized (gain) loss on derivative contracts43,849 (13,670)
Equity earnings from Laramie Energy, LLC(4,563)(10,706)
Equity earnings from refining and logistics investments(6,094) 
Dividends received from refining and logistics investments5,265  
Net changes in operating assets and liabilities: 
Trade accounts receivable(81,167)(24,906)
Prepaid and other assets90,745 21,084 
Inventories 27,269 112,340 
Deferred turnaround expenditures(13,347) 
Obligations under inventory financing agreements65,883 (43,910)
Accounts payable, other accrued liabilities, and operating lease ROU assets and liabilities(146,556)(184,389)
Net cash provided by operating activities25,431 139,095 
Cash flows from investing activities: 
Capital expenditures(22,642)(13,213)
Proceeds from sale of assets and other10 50 
Return of capital from Laramie Energy, LLC 10,706 
Net cash used in investing activities(22,632)(2,457)
Cash flows from financing activities: 
Proceeds from borrowings527,000 541,750 
Repayments of borrowings(545,565)(521,256)
Net borrowings on deferred payment arrangements and receivable advances2,443 22,407 
Payment of deferred loan costs(3,377)(4,210)
Purchase of common stock for retirement(34,107)(2,569)
Exercise of stock options 6,374 
Payments for debt extinguishment and commitment costs (8,742)
Net cash provided by (used in) financing activities(53,606)33,754 
Net increase (decrease) in cash, cash equivalents, and restricted cash(50,807)170,392 
Cash, cash equivalents, and restricted cash at beginning of period279,446 494,926 
Cash, cash equivalents, and restricted cash at end of period$228,639 $665,318 
Supplemental cash flow information:  
Net cash paid for:
Interest$(16,320)$(20,042)
Taxes(3,155)(454)
Non-cash investing and financing activities:  
Accrued capital expenditures$20,313 $4,328 
ROU assets obtained in exchange for new finance lease liabilities1,544 731 
ROU assets obtained in exchange for new operating lease liabilities18,756 8,380 
ROU assets terminated in exchange for release from finance lease liabilities  
ROU assets terminated in exchange for release from operating lease liabilities4,177  

See accompanying notes to the condensed consolidated financial statements.
4






PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Unaudited)
(in thousands)
Accumulated
AdditionalAccumulatedOther
Common StockPaid-In(Deficit)ComprehensiveTotal
SharesAmountCapitalEarningsIncomeEquity
Balance, December 31, 202260,471 $604 $836,491 $(200,687)$8,129 $644,537 
Stock-based compensation340 — 2,317 — — 2,317 
Purchase of common stock for retirement(81)— (3,114)— — (3,114)
Exercise of stock options300 6 6,368 — — 6,374 
Other comprehensive loss— — — — (11)(11)
Net income— — — 237,890 — 237,890 
Balance, March 31, 202361,030 $610 $842,062 $37,203 $8,118 $887,993 

Accumulated
AdditionalOther
Common StockPaid-InAccumulatedComprehensiveTotal
SharesAmountCapitalEarningsIncomeEquity
Balance, December 31, 202359,756 $597 $860,797 $465,856 $8,174 $1,335,424 
Stock-based compensation327 2 16,408 — — 16,410 
Purchase of common stock for retirement(1,013)(9)(4,251)(32,430)— (36,690)
Other comprehensive loss— — — — (54)(54)
Net loss— — — (3,751)— (3,751)
Balance, March 31, 202459,070 $590 $872,954 $429,675 $8,120 $1,311,339 
See accompanying notes to the condensed consolidated financial statements.
5

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023



Note 1Overview
Par Pacific Holdings, Inc. and its wholly owned subsidiaries (“Par” or the “Company”) provide both renewable and conventional fuels to the western United States. Currently, we operate in three primary business segments:
1) Refining - We own and operate four refineries. Our refineries in Kapolei, Hawaii, Newcastle, Wyoming, Tacoma, Washington, and Billings, Montana, convert crude oil into gasoline, distillate, asphalt and other products to serve the state of Hawaii and areas ranging from Washington state to the Dakotas and Wyoming.
2) Retail - We operate fuel retail outlets in Hawaii, Washington, and Idaho. We operate convenience stores and fuel retail sites under our “Hele” and “nomnom” brands, “76” branded fuel retail sites and other sites operated by third parties that sell gasoline, diesel, and retail merchandise such as soft drinks, prepared foods, and other sundries. We also operate unattended cardlock stations.
3) Logistics - We operate an extensive multi-modal logistics network spanning the Pacific, the Northwest, and the Rocky Mountain regions. This network includes a single point mooring (“SPM”) in Hawaii, a unit train-capable rail loading terminal in Washington, and other terminals, pipelines, trucking operations, marine vessels, storage facilities, loading and truck racks, and rail facilities for the movement of petroleum, refined products, and ethanol in and among the Hawaiian islands, between the U.S. West Coast and Hawaii, and in areas ranging from the state of Washington to the Dakotas and Wyoming.
As of March 31, 2024, we owned a 46.0% equity investment in Laramie Energy, LLC (“Laramie Energy”). Laramie Energy is focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado. As of March 31, 2024, through the Billings Acquisition (as defined in Note 5—Acquisitions), we own a 65% and a 40% equity investment in Yellowstone Energy Limited Partnership, (“YELP”) and Yellowstone Pipeline Company (“YPLC”), respectively.
Our Corporate and Other reportable segment primarily includes general and administrative costs.
Note 2—Summary of Significant Accounting Policies
Principles of Consolidation and Basis of Presentation
The condensed consolidated financial statements include the accounts of Par and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Certain amounts previously reported in our condensed consolidated financial statements for prior periods have been reclassified to conform with the current presentation.
The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, the instructions to Form 10-Q, and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Accordingly, they do not include all of the information and notes required by GAAP for complete consolidated financial statements. The condensed consolidated financial statements contained in this report include all material adjustments of a normal recurring nature that, in the opinion of management, are necessary for a fair presentation of the results for the interim periods presented. The results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the complete fiscal year or for any other period. The condensed consolidated balance sheet as of December 31, 2023 was derived from our audited consolidated financial statements as of that date. These condensed consolidated financial statements should be read together with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Use of Estimates
The preparation of our condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses and the related disclosures. Actual amounts could differ from these estimates.
Allowance for Credit Losses
We are exposed to credit losses primarily through our sales of refined products. Credit limits and/or prepayment requirements are set based on such factors as the customer’s financial results, credit rating, payment history, and industry and are reviewed annually for customers with material credit limits. Credit allowances are reviewed at least quarterly based on changes in the customer’s creditworthiness due to economic conditions, liquidity, and business strategy as publicly reported and
6

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


through discussions between the customer and the Company. We establish provisions for losses on trade receivables based on the estimated credit loss we expect to incur over the life of the receivable. We did not have a material change in our allowances on trade receivables during the three months ended March 31, 2024 or 2023.
Cost Classifications
Cost of revenues (excluding depreciation) includes the hydrocarbon-related costs of inventory sold, transportation costs of delivering product to customers, crude oil consumed in the refining process, costs to satisfy our environmental credit obligations, and certain hydrocarbon fees and taxes. Cost of revenues (excluding depreciation) also includes the unrealized gains and losses on derivatives and inventory valuation adjustments. Certain direct operating expenses related to our logistics segment are also included in Cost of revenues (excluding depreciation).
Operating expense (excluding depreciation) includes direct costs of labor, maintenance and services, energy and utility costs, property taxes, and environmental compliance costs, as well as chemicals and catalysts and other direct operating expenses.
The following table summarizes depreciation and finance lease amortization expense excluded from each line item in our condensed consolidated statements of operations (in thousands):
Three Months Ended March 31,
20242023
Cost of revenues$6,743 $4,999 
Operating expense18,825 12,404 
General and administrative expense473 502 
Recent Accounting Pronouncements
There have been no developments to recent accounting pronouncements, including the expected dates of adoption and estimated effects on our financial condition, results of operations, and cash flows, from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2023.
Note 3—Refining and Logistics Equity Investments
Yellowstone Energy Limited Partnership
On June 1, 2023, we completed the Billings Acquisition and acquired a 65% limited partnership ownership interest in YELP. YELP owns a cogeneration facility in Billings, Montana, that converts petroleum coke, supplied from our Montana refinery and other nearby third-party refineries, into power production for the local utility grid. We account for our investment in YELP using the equity method as we have the ability to exert significant influence over, but do not control its operating and financial policies. Our proportionate share of YELP’s net income and the depreciation of our basis difference are included in Equity earnings from refining and logistics investments on our condensed consolidated statements of operations, and reported as part of our refining segment. Please read Note 19—Segment Information for further information on our reporting segments. Our proportionate share of YELP’s net income (loss) is recorded on a one-month lag.
The change in our equity investment in YELP is as follows (in thousands):
Three Months Ended March 31,
2024
Beginning balance$59,824 
Equity earnings from YELP
4,465 
Depreciation of basis difference
(348)
Dividends received(5,265)
Ending balance$58,676 
Yellowstone Pipeline Company
7

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


On June 1, 2023, we completed the Billings Acquisition and acquired a 40% ownership interest in YPLC. YPLC owns a refined products pipeline that begins at our Montana refinery and transports refined product throughout Montana and the Pacific Northwest. We account for our ownership interest in YPLC using the equity method as we have the ability to exert significant influence over, but do not control, its operating and financial policies. Our proportionate share of YPLC’s net income and the accretion of our basis difference is included in Equity earnings from refining and logistics investments on our condensed consolidated statements of operations, and reported as part of our logistics segment. Please read Note 19—Segment Information for further information on our reporting segments.
The change in our equity investment in YPLC is as follows (in thousands):
Three Months Ended March 31,
2024
Beginning balance$27,662 
Equity earnings from YPLC
1,939 
Accretion of basis difference38 
Ending balance$29,639 
Note 4—Investment in Laramie Energy
Laramie Energy
As of March 31, 2024, we owned a 46.0% ownership interest in Laramie Energy, an entity focused on developing and producing natural gas in Garfield, Mesa, and Rio Blanco counties, Colorado. The balance of our investment in Laramie Energy was $18.8 million and $14.3 million as of March 31, 2024 and December 31, 2023, respectively.
On February 21, 2023, Laramie Energy entered into a new term loan agreement which provides a $205 million first lien term loan facility with $160.0 million funded at closing and an optional $45 million delayed draw commitment, subject to certain terms and conditions. Under the terms of the new term loan, Laramie is permitted to make future cash distributions to its owners, including us, subject to certain restrictions. Laramie Energy’s term loan matures on February 21, 2027. As of March 31, 2024 and December 31, 2023, the term loan had an outstanding balance of $160.0 million.
On March 1, 2023, pursuant to its new term loan agreement, Laramie Energy made a one-time cash distribution to its owners, including us, based on ownership percentage. Our share of this distribution was $10.7 million, which was reflected as Return of capital from Laramie Energy, LLC on our condensed consolidated statements of cash flows. We recorded the cash received as Equity earnings from Laramie Energy, LLC on our condensed consolidated statements of operations because the carrying value of our investment in Laramie Energy was zero at the time of such distribution.
Effective February 21, 2023, and concurrent with the new term loan agreement noted above, we resumed the application of equity method accounting with respect to our investment in Laramie Energy. At March 31, 2024, our equity in the underlying net assets of Laramie Energy exceeded the carrying value of our investment by approximately $69.5 million. This difference arose primarily due to other-than-temporary impairments of our equity investment in Laramie Energy.
The change in our equity investment in Laramie Energy is as follows (in thousands):
Three Months Ended March 31,
2024
Beginning balance$14,279 
Equity earnings (losses) from Laramie Energy2,949 
Accretion of basis difference1,614 
Ending balance
$18,842 
8

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


Note 5—Acquisitions
Billings Acquisition
On October 20, 2022, we and our subsidiaries Par Montana, LLC (“Par Montana”) and Par Montana Holdings, LLC (“Par Montana Holdings”), entered into an equity and asset purchase agreement (as amended to include Par Rocky Mountain Midstream, LLC, the “Purchase Agreement”) with Exxon Mobil Corporation, ExxonMobil Oil Corporation, and ExxonMobil Pipeline Company LLC (collectively, the “Sellers”) to purchase (i) the high-conversion, complex refinery located in Billings, Montana and certain associated distribution and logistics assets, (ii) the Sellers’ 65% limited partnership equity interest in YELP, and (iii) the Sellers’ 40% equity interest in YPLC for a base purchase price of $310.0 million plus the value of hydrocarbon inventory and adjusted working capital at closing (collectively, the “Billings Acquisition”). On June 1, 2023, we completed the Billings Acquisition for a total purchase price of approximately $625.4 million, including acquired working capital, consisting of a cash deposit of $30.0 million paid on October 20, 2022, upon execution of the Purchase Agreement and $595.4 million paid at closing on June 1, 2023. The Company funded the Billings Acquisition with cash on hand and borrowings from the ABL Credit Facility (as defined in Note 11—Debt).
We accounted for the Billings Acquisition as a business combination whereby the purchase price was allocated to the assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. A summary of the fair value of the assets acquired and liabilities assumed is as follows (in thousands):
Trade accounts receivable$2,387 
Inventories299,176 
Property, plant, and equipment259,088 
Operating lease right-of-use assets3,562 
Investment in refining and logistics subsidiaries86,600 
Other long-term assets4,094 
Total assets (1)654,907 
Current operating lease liabilities2,081 
Other current liabilities7,056 
Environmental liabilities18,869 
Long-term operating lease liabilities1,481 
Total liabilities29,487 
Total$625,420 
_______________________________________________________
(1)We allocated $538.7 million and $116.2 million of total assets to our refining and logistics segments, respectively.
As of March 31, 2024, we finalized the Billings Acquisition purchase price allocation. We incurred $5.3 million of acquisition costs related to the Billings Acquisition for the three months ended March 31, 2023. These costs are included in Acquisition and integration costs on our condensed consolidated statements of operations.
We assumed certain environmental liabilities associated with the Billings Acquisition, including costs related to hazardous waste corrective measures, ground and surface water sampling and monitoring. We expect to incur these costs over a 20 to 30 year period.
The results of operations of the Montana refinery, newly acquired logistics assets in the Rockies region, and YELP and YPLC equity investments were included in our results beginning on June 1, 2023. The following unaudited pro forma financial
9

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


information presents our consolidated revenues and net income as if the Billings Acquisition had been completed on January 1, 2022 (in thousands):
Three Months Ended March 31,
2023
Revenues$2,198,921 
Net income311,610 
These pro forma results were based on estimates and assumptions that we believe are reasonable. The unaudited pro forma financial information is not necessarily indicative of the results of operations that would have been achieved had the Billings Acquisition been effective as of the dates presented, nor is it indicative of future operating results of the combined company. Pro forma adjustments include (i) incremental depreciation resulting from the estimated fair value of property, plant, and equipment acquired, (ii) transaction costs which were shifted from the three months ended March 31, 2023 to the three months ended March 31, 2022 and (iii) elimination of historical transactions between Par and the Montana assets.
Note 6—Revenue Recognition
As of March 31, 2024 and December 31, 2023, receivables from contracts with customers were $373.1 million and $311.1 million, respectively. Our refining segment recognizes deferred revenues when cash payments are received in advance of delivery of products to the customer. Deferred revenue was $21.6 million and $15.2 million as of March 31, 2024 and December 31, 2023, respectively. We have elected to apply a practical expedient not to disclose the value of unsatisfied performance obligations for (i) contracts with an original expected duration of less than one year and (ii) contracts where the variable consideration has been allocated entirely to our unsatisfied performance obligation.
The following table provides information about disaggregated revenue by major product line and includes a reconciliation of the disaggregated revenues to total segment revenues (in thousands):
Three Months Ended March 31, 2024RefiningLogisticsRetail
Product or service:
Gasoline$647,186 $ $103,293 
Distillates (1)832,797  11,180 
Other refined products (2)403,993   
Merchandise  24,793 
Transportation and terminalling services 71,842  
Other revenue42,640  868 
Total segment revenues (3)$1,926,616 $71,842 $140,134 
Three Months Ended March 31, 2023RefiningLogisticsRetail
Product or service:
Gasoline$450,325 $ $100,188 
Distillates (1)779,053  11,599 
Other refined products (2)385,609   
Merchandise  22,828 
Transportation and terminalling services 52,388  
Other revenue425  957 
Total segment revenues (3)$1,615,412 $52,388 $135,572 
_______________________________________________________
(1)Distillates primarily include diesel and jet fuel.
(2)Other refined products include fuel oil, vacuum gas oil, and asphalt.
(3)Refer to Note 19—Segment Information for the reconciliation of segment revenues to total consolidated revenues.
10

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


Note 7—Inventories
Inventories at March 31, 2024, and December 31, 2023, consisted of the following (in thousands):
Titled InventorySupply and Offtake Agreement (1)Total
March 31, 2024
Crude oil and feedstocks$201,617 $211,821 $413,438 
Refined products and blendstock346,635 154,856 501,491 
Warehouse stock and other (2)218,140  218,140 
Total$766,392 $366,677 $1,133,069 
December 31, 2023
Crude oil and feedstocks$175,307 $168,549 $343,856 
Refined products and blendstock358,236 133,684 491,920 
Warehouse stock and other (2)324,619  324,619 
Total$858,162 $302,233 $1,160,395 
________________________________________________________
(1)Please read Note 9—Inventory Financing Agreements for further information.
(2)Includes $128.7 million and $237.6 million of RINs and environmental credits, reported at the lower of cost or net realizable value, as of March 31, 2024 and December 31, 2023, respectively. Our renewable volume obligation and other gross environmental credit obligations of $134.5 million and $286.9 million, are included in Other accrued liabilities on our condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, respectively.
As of March 31, 2024 and December 31, 2023, there was no reserve for the lower of cost or net realizable value of inventory. As of March 31, 2024 and December 31, 2023, the current replacement cost exceeded the LIFO inventory carrying value by approximately $42.8 million and $36.1 million, respectively.
Note 8—Prepaid and Other Current Assets
Prepaid and other current assets at March 31, 2024 and December 31, 2023 consisted of the following (in thousands):
March 31, 2024December 31, 2023
Advances to suppliers for crude purchases$ $65,531 
Collateral posted with broker for derivative instruments (1)5,855 21,763 
Prepaid insurance13,521 20,235 
Derivative assets16,230 43,356 
Prepaid environmental credits 20,756 
Other12,714 10,764 
Total$48,320 $182,405 
_________________________________________________________
(1)Our cash margin that is required as collateral deposits on our commodity derivatives cannot be offset against the fair value of open contracts except in the event of default. Please read Note 12—Derivatives for further information.
Note 9—Inventory Financing Agreements
The following table summarizes our outstanding obligations under our inventory financing agreements (in thousands):
March 31, 2024December 31, 2023
Supply and Offtake Agreement
$662,688 $594,362 
LC Facility due 2024
  
Obligations under inventory financing agreements$662,688 $594,362 
11

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


Supply and Offtake Agreement
We have a supply and offtake agreement with J. Aron to support our Hawaii refining operations (the “Supply and Offtake Agreement"). Under the Supply and Offtake Agreement, we pay or receive certain fees from J. Aron based on changes in market prices over time. The amount due to or from J. Aron was recorded as an adjustment to our Obligations under inventory financing agreements as allowed under the Supply and Offtake Agreement. The Supply and Offtake Agreement expires May 31, 2024 (as extended, the “Expiration Date”).
LC Facility due 2024
On July 26, 2023, PHR, as borrower, the lenders and letter of credit issuing banks party thereto (collectively, the “LC Facility Lenders”), MUFG Bank, Ltd., as administrative agent (the “LC Facility Agent”), sub-collateral agent, joint lead arranger and sole bookrunner, Macquarie Bank Limited, as joint lead arranger, and U.S. Bank Trust Company, National Association, as collateral agent (the “Collateral Agent”), entered into an Uncommitted Credit Agreement (the “LC Facility Agreement”) whereby the LC Facility Lenders agree, on an uncommitted and absolutely discretionary basis, to consider making revolving credit loans and issuing and participating in letters of credit. The LC Facility will mature on July 25, 2024, unless the obligations are accelerated and the maximum credit limits of the LC Facility Lenders are terminated prior to such date.
The following table summarizes our outstanding borrowings, letters of credit, and contractual undertaking obligations under the intermediation agreements (in thousands):
March 31, 2024December 31, 2023
Discretionary Draw Facility
Outstanding borrowings (1)
$167,902 $165,459 
Borrowing capacity
169,765 175,891 
MLC receivable advances
Outstanding borrowings (1)
  
Borrowing capacity
  
LC Facility due 2024
Outstanding borrowings
  
Borrowing capacity
120,000 120,000 
MLC issued letters of credit  
LC Facility issued letters of credit
 13,000 
______________________________________________________
(1)Borrowings outstanding under the Discretionary Draw Facility and MLC receivable advances are included in Obligations under inventory financing agreements on our condensed consolidated balance sheets. Changes in the borrowings outstanding under these arrangements are included within Cash flows from financing activities on the condensed consolidated statements of cash flows.
12

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


The following table summarizes the inventory intermediation fees, which are included in Cost of revenues (excluding depreciation) on our condensed consolidated statements of operations, and Interest expense and financing costs, net related to the intermediation agreements (in thousands):
Three Months Ended March 31,
20242023
Net fees and expenses:
Supply and Offtake Agreement
Inventory intermediation fees (1)$19,038 $13,999 
Interest expense and financing costs, net1,784 1,725 
Washington Refinery Intermediation Agreement
Inventory intermediation fees (benefits)$ $750 
Interest expense and financing costs, net 2,659 
LC Facility due 2024
Interest expense and financing costs, net$618 $ 
___________________________________________________
(1)Inventory intermediation fees under the Supply and Offtake Agreement include market structure fees of $8.8 million and $2.4 million for the three months ended March 31, 2024 and 2023, respectively.
The Supply and Offtake Agreement also provide us with the ability to economically hedge price risk on our inventories and crude oil purchases. Please read Note 12—Derivatives for further information.
Note 10—Other Accrued Liabilities

Other accrued liabilities at March 31, 2024 and December 31, 2023 consisted of the following (in thousands):
March 31, 2024December 31, 2023
Accrued payroll and other employee benefits$19,998 $40,533 
Environmental credit obligations (1)134,493 286,904 
Derivative liabilities22,579 27,725 
Deferred revenue21,553 15,220 
Other40,404 51,380 
Total$239,027 $421,762 
___________________________________________________
(1)Please read Note 13—Fair Value Measurements for further information. A portion of these obligations are expected to be settled with our RINs assets and other environmental credits, which are presented as Inventories on our condensed consolidated balance sheet and are stated at the lower of cost or net realizable value. The carrying costs of these assets were $128.7 million and $237.6 million as of March 31, 2024 and December 31, 2023, respectively.
Note 11—Debt
The following table summarizes our outstanding debt (in thousands):
March 31, 2024December 31, 2023
ABL Credit Facility due 2028
$105,000 $115,000 
Term Loan Credit Agreement due 2030
544,500 545,875 
Other long-term debt4,589 4,746 
Principal amount of long-term debt654,089 665,621 
Less: unamortized discount and deferred financing costs(14,580)(14,763)
Total debt, net of unamortized discount and deferred financing costs639,509 650,858 
Less: current maturities, net of unamortized discount and deferred financing costs(4,226)(4,255)
Long-term debt, net of current maturities$635,283 $646,603 
13

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


As of March 31, 2024 and December 31, 2023, we had $117.1 million and $133.7 million in letters of credit outstanding under the ABL Credit Facility, as defined below, respectively. We had $56.4 million and $56.2 million in surety bonds outstanding as of March 31, 2024 and December 31, 2023, respectively.
    Under the ABL Credit Facility and the Term Loan Credit Agreement, defined below, our subsidiaries are restricted from paying dividends or making other equity distributions, subject to certain exceptions.
ABL Credit Facility due 2028
On April 26, 2023, in connection with the Billings Acquisition, we entered into an Asset-Based Revolving Credit Agreement with certain lenders, and Wells Fargo Bank, National Association, as administrative agent and collateral agent (as amended from time to time, the “ABL Credit Facility”). On March 22, 2024, we entered into the Third Amendment (the “Third Amendment”) to the ABL Credit Facility. The Third Amendment provided for, among other things, (i) incremental commitments that increase the total revolver commitment under the ABL Credit Facility to $1.4 billion, (ii) future incremental increases up to $400 million, (iii) the joinder of PHR to the ABL Credit Facility as a Borrower and (iv) certain other amendments to the ABL Credit Facility to permit a new intermediation facility in favor of PHR, in each case subject to the satisfaction of certain conditions set forth in the Third Amendment, including the termination of the Company’s existing intermediation agreement with J. Aron. We recorded deferred financing costs of $3.8 million related to the Third Amendment that will be amortized over the remaining term of the ABL Credit Facility. As of March 31, 2024, the ABL Credit Facility had $105 million outstanding in revolving loans, and a borrowing base of approximately $567.5 million.
Term Loan Credit Agreement due 2030
On February 28, 2023, we entered into a term loan credit agreement (the “Term Loan Credit Agreement”) with Wells Fargo Bank, National Association, as administrative agent (the “Agent”), and the lenders party thereto (“Lenders”). Pursuant to the Term Loan Credit Agreement, the Lenders made an initial senior secured term loan in the principal amount of $550.0 million at a price equal to 98.5% of its face value. The initial loan bears interest at Secured Overnight Financing Rate (“SOFR”). The net proceeds were used to refinance our existing Term Loan B Facility, repurchase our outstanding 7.75% Senior Secured Notes and 12.875% Senior Secured Notes, and for general corporate purposes. We recognized an aggregate of $2.8 million in debt modification costs in connection with the refinancing, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023.
On April 8, 2024, we entered into Amendment No. 1 to Term Loan Credit Agreement; please read Note 20—Subsequent Events for further information.
The Term Loan Credit Agreement requires quarterly payments of $1.4 million on the last business day of each March, June, September and December, commencing on June 30, 2023, with the balance due upon maturity. The Term Loan Credit Agreement matures on February 28, 2030.
7.75% Senior Secured Notes due 2025
On December 21, 2017, Par Petroleum, LLC and Par Petroleum Finance Corp. (collectively, the “Issuers”), both our wholly owned subsidiaries, completed the issuance and sale of $300 million in aggregate principal amount of 7.75% Senior Secured Notes in a private placement under Rule 144A and Regulation S of the Securities Act of 1933, as amended. On February 28, 2023, we repurchased and cancelled $260.6 million in aggregate principal amount of the 7.75% Senior Secured Notes at a repurchase price of 102.120% of the aggregate principal amount repurchased. On March 17, 2023, we repurchased and cancelled all remaining outstanding 7.75% Senior Secured Notes at a repurchase price of 101.938% of the aggregate principal amount repurchased. In connection with the termination of the 7.75% Senior Secured Notes, we recognized debt extinguishment costs of $5.9 million associated with debt repurchase premiums and $3.4 million associated with unamortized deferred financing costs, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023. Our 7.75% Senior Secured Notes bore interest at a rate of 7.750% per year (payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2018).
Term Loan B Facility due 2026
On January 11, 2019, the Issuers entered into a new term loan facility with Goldman Sachs Bank USA, as administrative agent, and the lenders party thereto from time to time (the “Term Loan B Facility”). On February 28, 2023, we terminated and repaid all amounts outstanding under the Term Loan B Facility. We recognized debt extinguishment costs of $1.7 million associated with unamortized deferred financing costs, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023. The
14

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


Term Loan B Facility bore interest at a rate per annum equal to Adjusted LIBOR (as defined in the Term Loan B Facility) plus an applicable margin of 6.75% or at a rate per annum equal to Alternate Base Rate (as defined in the Term Loan B Facility) plus an applicable margin of 5.75%. In addition to the quarterly interest payments, the Term Loan B Facility required quarterly principal payments of $3.1 million.
12.875% Senior Secured Notes due 2026
On June 5, 2020, the Issuers completed the issuance and sale of $105.0 million in aggregate principal amount of 12.875% Senior Secured Notes in a private placement under Rule 144A and Regulation S of the Securities Act of 1933, as amended. On February 28, 2023, we repurchased and cancelled $29 million in aggregate principal amount of the 12.875% Senior Secured Notes at a repurchase price of 109.044% of the aggregate principal amount repurchased. On March 17, 2023, we repurchased and cancelled all remaining outstanding 12.875% Senior Secured Notes at a repurchase price of 108.616% of the aggregate principal amount repurchased. In connection with the termination of the 12.875% Senior Secured Notes, we recognized debt extinguishment costs of $2.8 million associated with debt repurchase premiums and $1.1 million associated with unamortized deferred financing costs, which were recorded in Debt extinguishment and commitment costs on our condensed consolidated statement of operations for the three months ended March 31, 2023. The 12.875% Senior Secured Notes bore interest at an annual rate of 12.875% per year (payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2021).

Other long-term debt

On June 7, 2023, we entered into two promissory notes with a third-party lender to acquire land in Kahului, Hawaii, and Hilo, Hawaii totaling $5.1 million. The notes bear interest at a fixed rate of 4.625% per annum and are payable on the first day of each month, commencing on July 1, 2023, until maturity. The promissory notes are unsecured and mature on June 7, 2030.

Cross Default Provisions
Included within each of our debt agreements are affirmative and negative covenants, and customary cross default provisions, that require the repayment of amounts outstanding on demand unless the triggering payment default or acceleration is remedied, rescinded, or waived. As of March 31, 2024, we were in compliance with all of our debt instruments.
Guarantors
In connection with our shelf registration statement on Form S-3, which was filed with the Securities and Exchange Commission (“SEC”) and became automatically effective on February 14, 2022 (“Registration Statement”), we may sell non-convertible debt securities and other securities in one or more offerings with an aggregate initial offering price of up to $750.0 million. Any non-convertible debt securities issued under the Registration Statement may be fully and unconditionally guaranteed (except for customary release provisions), on a joint and several basis, by some or all of our subsidiaries, other than subsidiaries that are “minor” within the meaning of Rule 3-10 of Regulation S-X (the “Guarantor Subsidiaries”). We have excluded the summarized financial information for the Guarantor Subsidiaries as the assets and results of operations of the Company and the Guarantor Subsidiaries are not materially different than the corresponding amounts presented on our consolidated financial statements.
Note 12—Derivatives
Commodity Derivatives
Our condensed consolidated balance sheets present derivative assets and liabilities on a net basis. Please read Note 13—Fair Value Measurements for the gross fair value and net carrying value of our derivative instruments.
Our open futures and over-the-counter (“OTC”) swaps expire in March 2025. At March 31, 2024, our open commodity derivative contracts represented (in thousands of barrels):
Contract TypePurchasesSalesNet
Futures20,430 (21,630)(1,200)
Swaps23,726 (29,940)(6,214)
Total44,156 (51,570)(7,414)
15

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


At March 31, 2024, we also had option collars that economically hedge a portion of our internally consumed fuel at our refineries. The following table provides information on these option collars at our refineries as of March 31, 2024:
Total open option collars1,175
Weighted-average strike price - floor (in dollars)$61.59
Weighted-average strike price - ceiling (in dollars)$82.65
Earliest commencement dateApril 2024
Furthest expiry dateDecember 2024
Interest Rate Derivatives
We are exposed to interest rate volatility in our ABL Credit Facility, LC Facility, Term Loan Credit Agreement, and the Supply and Offtake Agreement. We may utilize interest rate swaps to manage our interest rate risk. On April 12, 2023, we entered into an interest rate collar transaction to manage our interest rate risk related to the Term Loan Credit Agreement. The interest rate collar agreement reduces variable interest rate risk from May 31, 2023, through May 31, 2026, with a notional amount of $300.0 million as of March 31, 2024. The terms of the agreement provide for an interest rate cap of 5.50% and floor of 2.30%, based on the three month SOFR as of the fixing date. We pay variable interest quarterly until the three month SOFR reaches the floor. If the three month SOFR is between the floor and the cap, no payment is due to either party. If the three month SOFR is greater than the cap, the counterparty pays us. The interest rate collar transaction expires on May 31, 2026.
The following table provides information on the fair value amounts (in thousands) of these derivatives as of March 31, 2024 and December 31, 2023, and their placement within our condensed consolidated balance sheets.
Balance Sheet LocationMarch 31, 2024December 31, 2023
Asset (Liability)
Commodity derivatives (1)Prepaid and other current assets$16,048 $43,356 
Commodity derivatives (2)
Other accrued liabilities(22,015)(530)
J. Aron repurchase obligation derivativeObligations under inventory financing agreements(22,208)(392)
Interest rate derivativesOther long-term assets23  
Interest rate derivativesOther liabilities (821)
_________________________________________________________
(1)Does not include cash collateral of $5.9 million and $21.8 million recorded in Prepaid and other current assets as of March 31, 2024 and December 31, 2023, respectively, and $9.5 million in Other long-term assets as of both March 31, 2024 and December 31, 2023. Does not include $0.2 million recorded in Prepaid and other current assets as of March 31, 2024, related to realized derivatives receivable.
(2)Does not include $0.6 million and $27.2 million recorded in Other accrued liabilities as of March 31, 2024 and December 31, 2023, respectively, related to realized derivatives payable.
The following table summarizes the pre-tax gains (losses) recognized in Net income (loss) on our condensed consolidated statements of operations resulting from changes in fair value of derivative instruments not designated as hedges charged directly to earnings (in thousands):
Three Months Ended March 31,
Statement of Operations Location20242023
Commodity derivativesCost of revenues (excluding depreciation)$(27,360)$(624)
J. Aron repurchase obligation derivativeCost of revenues (excluding depreciation)(21,816)13,380 
MLC terminal obligation derivativeCost of revenues (excluding depreciation) (17,023)
Interest rate derivativesInterest expense and financing costs, net844  
16

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


Note 13—Fair Value Measurements
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
Purchase Price Allocation of Billings Acquisition
The fair values of the assets acquired and liabilities assumed as a result of the Billings Acquisition were estimated as of June 1, 2023, the date of the acquisition, using valuation techniques described in notes (1) through (5) below.
Valuation
Fair ValueTechnique
(in thousands)
Net working capital excluding operating leases$294,507 (1)
Property, plant, and equipment259,088 (2)
Operating lease right-of-use assets3,562 (3)
Refining and logistics equity investments86,600 (4)
Other long-term assets4,094 (1)
Current operating lease liabilities(2,081)(3)
Long-term operating lease liabilities(1,481)(3)
Environmental liabilities(18,869)(5)
Total$625,420 
(1)Current assets acquired and liabilities assumed were recorded at their net realizable value. Other long-term assets includes preliminary costs for future turnarounds that were recently incurred and were recorded at their net realizable values.
(2)The fair value of personal property was estimated using the cost approach. Key assumptions in the cost approach include determining the replacement cost by evaluating recent purchases of comparable assets or published data, and adjusting replacement cost for economic and functional obsolescence, location, normal useful lives, and capacity (if applicable). The fair value of real property was estimated using the market approach. Key assumptions in the market approach include determining the asset value by evaluating recent purchases of comparable assets under similar circumstances. We consider this to be a Level 3 fair value measurement.
(3)Operating lease right-of-use assets and liabilities were recognized based on the present value of lease payments over the lease term using the incremental borrowing rate at acquisition of 9.6%.
(4)The fair value of our investments in YELP and YPLC were determined using a combination of the income approach and the market approach. Under the income approach, we estimated the present value of expected future cash flows using a market participant discount rate. Under the market approach, we estimated fair value using observable multiples for comparable companies in the investments’ industries. These valuation methods require us to make significant estimates and assumptions regarding future cash flows, capital projects, commodity prices, long-term growth rates, and discount rates. We consider this to be a Level 3 fair value measurement.
(5)Environmental liabilities are based on management’s best estimates of probable future costs using currently available information. We consider this to be a Level 3 fair value measurement.
Equity Method Investments
We evaluate equity method investments for impairment when factors indicate that a decrease in the value of our investment has occurred and the carrying amount of our investment may not be recoverable. An impairment loss, based on the difference between the carrying value and the estimated fair value of the investment, is recognized in earnings when an impairment is deemed to be other than temporary.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
Derivative Instruments
We classify financial assets and liabilities according to the fair value hierarchy. Financial assets and liabilities classified as Level 1 instruments are valued using quoted prices in active markets for identical assets and liabilities. These include our exchange traded futures. Level 2 instruments are valued using quoted prices for similar assets and liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability. Our Level 2 instruments include
17

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


OTC swaps and options. These derivatives are valued using market quotations from independent price reporting agencies and commodity exchange price curves that are corroborated with market data. Level 3 instruments are valued using significant unobservable inputs that are not supported by sufficient market activity. The valuation of the embedded derivatives related to our J. Aron repurchase obligation is based on estimates of the prices and differentials assuming settlement at the end of the reporting period. Estimates of the J. Aron settlement prices are based on observable inputs, such as Brent indices, and unobservable inputs, such as contractual price differentials as defined in the Supply and Offtake Agreement. Such contractual differentials vary by location and by the type of product, have a weighted average premium of $9.46, and range from a discount of $6.99 per barrel to a premium of $36.46 per barrel as of March 31, 2024. Contractual price differentials are considered unobservable inputs; therefore, these embedded derivatives are classified as Level 3 instruments. We do not have other commodity derivatives classified as Level 3 at March 31, 2024, or December 31, 2023. Please read Note 12—Derivatives for further information on derivatives.
Gross Environmental Credit Obligations
During the quarter ended December 31, 2023, we had a change in estimate in our valuation of our gross environmental credit obligations due to the settlement of all outstanding prior period environmental credit obligations. Beginning in the fourth quarter of 2023, the portion of the estimated gross environmental credit obligations satisfied by internally generated or purchased RINs or other environmental credits is recorded at the carrying value of such internally generated or purchased RINs or other environmental credits. The remainder of the estimated gross environmental credit obligation is recorded at the market price of the RINs or other environmental credits that are needed to satisfy the remaining obligation as of the end of the reporting period and classified as Level 2 instruments as we obtain the pricing inputs for the RINs and other environmental credits from brokers based on market quotes on similar instruments. Please read Note 15—Commitments and Contingencies for further information on the U.S. Environmental Protection Agency (“EPA”) regulations related to greenhouse gases.
Financial Statement Impact
Fair value amounts by hierarchy level as of March 31, 2024 and December 31, 2023, are presented gross in the tables below (in thousands):
March 31, 2024
Level 1Level 2Level 3Gross Fair ValueEffect of Counter-Party NettingNet Carrying Value on Balance Sheet (1)
Assets
Commodity derivatives$160,737 $168,836 $ $329,573 $(313,525)$16,048 
Interest rate derivatives 23  23  23 
Total$160,737 $168,859 $ $329,596 $(313,525)$16,071 
Liabilities
Commodity derivatives$(144,686)$(190,854)$ $(335,540)$313,525 $(22,015)
J. Aron repurchase obligation derivative  (22,208)(22,208) (22,208)
Gross environmental credit obligations (2) (3)
 (13,439) (13,439) (13,439)
Total liabilities$(144,686)$(204,293)$(22,208)$(371,187)$313,525 $(57,662)
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PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


December 31, 2023
Level 1Level 2Level 3Gross Fair ValueEffect of Counter-Party NettingNet Carrying Value on Balance Sheet (1)
Assets
Commodity derivatives$100,074 $175,191 $ $275,265 $(231,909)$43,356 
Liabilities
Commodity derivatives$(92,417)$(140,022)$ $(232,439)$231,909 $(530)
J. Aron repurchase obligation derivative  (392)(392) (392)
Interest rate derivatives (821) (821) (821)
Gross environmental credit obligations (2) (3)
 (54,245) (54,245) (54,245)
Total liabilities$(92,417)$(195,088)$(392)$(287,897)$231,909 $(55,988)
_________________________________________________________
(1)Does not include cash collateral of $15.4 million and $31.3 million as of March 31, 2024 and December 31, 2023, respectively, included within Prepaid and other current assets and Other long-term assets on our condensed consolidated balance sheets.
(2)Does not include RINs assets and other environmental credits of $128.7 million and $237.6 million presented as Inventories on our condensed consolidated balance sheet and stated at the lower of cost and net realizable value as of March 31, 2024 and December 31, 2023, respectively.
(3)Does not include environmental liabilities of $140.3 million and $232.7 million satisfied by internally generated or purchased environmental credits and presented at the carrying value of these credits included in Other Accrued Liabilities on our condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, respectively.
A roll forward of Level 3 derivative instruments measured at fair value on a recurring basis is as follows (in thousands):
Three Months Ended March 31,
20242023
Balance, at beginning of period$(392)$2,279 
Settlements (4,615)
Total losses included in earnings (1)(21,816)(3,643)
Balance, at end of period$(22,208)$(5,979)
_________________________________________________________
(1)Included in Cost of revenues (excluding depreciation) on our condensed consolidated statements of operations.
The carrying value and fair value of long-term debt and other financial instruments as of March 31, 2024 and December 31, 2023 are as follows (in thousands):
March 31, 2024
Carrying ValueFair Value
ABL Credit Facility due 2028 (2)
$105,000 $105,000 
LC Facility due 2024 (2)
  
Term Loan Credit Agreement due 2030 (1)
529,920 546,569 
Other long-term debt (1)4,589 4,310 
19

PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


December 31, 2023
Carrying ValueFair Value
ABL Credit Facility due 2028 (2)$115,000 $115,000 
LC Facility due 2024 (2)  
Term Loan Credit Agreement due 2030 (1)531,112 545,875 
Other long-term debt (1)4,746 4,387 
_________________________________________________________
(1)The fair value measurements of the Term Loan Credit Agreement and Other long-term debt are considered Level 2 measurements in the fair value hierarchy as discussed below.
(2)The fair value measurements of the ABL Credit Facility and LC Facility are considered Level 3 measurements in the fair value hierarchy.
The fair values of the Term Loan Credit Agreement and Other long-term debt were determined using a market approach based on quoted prices and the inputs used to measure the fair value are classified as Level 2 inputs within the fair value hierarchy.
The carrying value of our ABL Credit Facility was determined to approximate fair value as of March 31, 2024. The fair value of all non-derivative financial instruments recorded in current assets, including cash and cash equivalents, restricted cash, and trade accounts receivable, and current liabilities, including accounts payable, approximate their carrying value due to their short-term nature.
Note 14—Leases
We have cancellable and non-cancellable finance and operating lease liabilities for the lease of land, vehicles, office space, retail facilities, and other facilities used in the storage and transportation of crude oil and refined products. Most of our leases include one or more options to renew, with renewal terms that can extend the lease term from one to 30 years or more. There are no material residual value guarantees associated with any of our leases.
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PAR PACIFIC HOLDINGS, INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
For the Interim Periods Ended March 31, 2024 and 2023


The following table provides information on the amounts (in thousands) of our right-of-use assets (“ROU assets”) and liabilities, weighted-average remaining lease term, and weighted average discount rate as of March 31, 2024 and December 31, 2023 and their placement within our condensed consolidated balance sheets:
Lease typeBalance Sheet LocationMarch 31, 2024December 31, 2023
Assets
FinanceProperty, plant, and equipment$30,589 $28,264 
FinanceAccumulated amortization(12,756)(12,212)
FinanceProperty, plant, and equipment, net$17,833 $16,052 
Operating
Operating lease right-of-use (“ROU”) assets
341,405 346,454 
Total right-of-use assets$359,238 $362,506 
Liabilities
Current
FinanceOther accrued liabilities$2,000 $1,820 
OperatingOperating lease liabilities68,841 72,833 
Long-term
FinanceFinance lease liabilities13,375 12,438 
OperatingOperating lease liabilities283,099 282,517 
Total lease liabilities$367,315 $369,608 
Weighted-average remaining lease term (in years)
Finance10.7511.02
Operating8.578.67
Weighted-average discount rate
Finance7.11 %8.04 %
Operating7.25 %7.24 %
The following table summarizes the lease costs and income recognized in our condensed consolidated statements of operations (in thousands):
Three Months Ended March 31,