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Segment Information | 6 Months Ended
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Jun. 30, 2024
Segment Reporting [Abstract] |
Segment Information | Segment Information Our operations are organized into five reportable segments: Refining, Renewables, Marketing, Lubricants & Specialties and Midstream. Our operations that are not included in one of these five reportable segments are included in Corporate and Other. Intersegment transactions are eliminated in our consolidated financial statements and are included in Eliminations. Corporate and Other and Eliminations are aggregated and presented under the Corporate, Other and Eliminations column. The Refining segment represents the operations of our El Dorado, Tulsa, Navajo, Woods Cross, Puget Sound, Parco and Casper refineries and HF Sinclair Asphalt Company LLC (“Asphalt”). Refining activities involve the purchase and refining of crude oil and wholesale marketing of refined products, such as gasoline, diesel fuel and jet fuel. These petroleum products are primarily marketed in the Mid-Continent, Southwest and Rocky Mountains extending into the Pacific Northwest geographic regions of the United States. Asphalt operates various asphalt terminals in Arizona, New Mexico and Oklahoma. The Renewables segment represents the operations of our Cheyenne renewable diesel unit (“RDU”), Artesia RDU, the Sinclair RDU and the pre-treatment unit at our Artesia, New Mexico facility. The Marketing segment represents branded fuel sales to Sinclair branded sites in the United States and licensing fees for the use of the Sinclair brand at additional locations throughout the country. The Marketing segment also includes branded fuel sales to non-Sinclair branded sites from legacy HollyFrontier Corporation (“HollyFrontier”) agreements and revenues from other marketing activities. Our branded sites are located in several states across the United States with the highest concentration of the sites located in our West and Mid-Continent regions. The Lubricants & Specialties segment represents Petro-Canada Lubricants Inc.’s production operations, located in Mississauga, Ontario, which includes lubricant products such as base oils, white oils, specialty products and finished lubricants, and the operations of our Petro-Canada Lubricants business that includes the marketing of products to both retail and wholesale outlets through a global sales network with locations in Canada, the United States and Europe. Additionally, the Lubricants & Specialties segment includes specialty lubricant products produced at our Tulsa refineries that are marketed throughout North America and are distributed in Central and South America and the operations of Red Giant Oil Company LLC, one of the leading suppliers of locomotive engine oil in North America. Also, the Lubricants & Specialties segment includes Sonneborn, a producer of specialty hydrocarbon chemicals such as white oils, petrolatums and waxes with manufacturing facilities in the United States and Europe. The Midstream segment includes all of the operations of HEP, which owns and operates logistics and refinery assets consisting of petroleum product and crude oil pipelines, and terminals, tankage and loading rack facilities in the Mid-Continent, Southwest and Rocky Mountains geographic regions of the United States. The Midstream segment also includes 50% ownership interests in each of Osage Pipeline Company, LLC, the owner of a pipeline running from Cushing, Oklahoma to El Dorado, Kansas, Cheyenne Pipeline, LLC, the owner of a pipeline running from Fort Laramie, Wyoming to Cheyenne, Wyoming, and Cushing Connect, a 25.12% ownership interest in Saddle Butte Pipeline III, LLC, the owner of a pipeline running from the Powder River Basin to Casper, Wyoming, and a 49.995% ownership interest in Pioneer Investments Corp., the owner of a pipeline running from Sinclair, Wyoming to the North Salt Lake City, Utah Terminal. Revenues from the Midstream segment are earned through transactions with unaffiliated parties for pipeline transportation, rental and terminalling operations as well as revenues relating to pipeline transportation services provided for our refining operations. Beginning in the first quarter of 2024, our Refining segment acquired from our Midstream segment the refinery processing units at our El Dorado and Woods Cross refineries. Additionally, we amended an intercompany agreement between certain of our subsidiaries within the Refining, Lubricants & Specialties and Midstream segments. As a result, we have revised our Refining, Lubricants & Specialties and Midstream segment information for the periods presented. The accounting policies for our segments are the same as those described in the summary of significant accounting policies in our Annual Report on Form 10-K for the year ended December 31, 2023.
|  | Refining |  | Renewables |  | Marketing |  | Lubricants & Specialties |  | Midstream |  | Corporate, Other and Eliminations |  | Consolidated Total
|  | (In thousands)
Three Months Ended June 30, 2024 |  |  |  |  |  |  |  |  |  |
Sales and other revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from external customers |  | $ | 5,970,098 |  |  | $ | 180,228 |  |  | $ | 942,362 |  |  | $ | 726,049 |  |  | $ | 27,094 |  |  | $ | — |  |  | $ | 7,845,831 |
Intersegment revenues and other (1) |  | 1,007,711 |  |  | 68,050 |  |  | — |  |  | 5,350 |  |  | 131,087 |  |  | (1,212,198) |  |  | — |
|  | $ | 6,977,809 |  |  | $ | 248,278 |  |  | $ | 942,362 |  |  | $ | 731,399 |  |  | $ | 158,181 |  |  | $ | (1,212,198) |  |  | $ | 7,845,831 |
Cost of sales (exclusive of depreciation and amortization):
Cost of materials and other (exclusive of lower of cost or market inventory valuation adjustment) |  | 6,291,029 |  |  | 220,056 |  |  | 919,611 |  |  | 531,390 |  |  | — |  |  | (1,211,561) |  |  | 6,750,525 |
Lower of cost or market inventory valuation adjustment |  | — |  |  | (3,123) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (3,123) |
Operating expenses |  | 449,097 |  |  | 24,705 |  |  | — |  |  | 64,445 |  |  | 51,089 |  |  | 1,981 |  |  | 591,317 |
|  | 6,740,126 |  |  | 241,638 |  |  | 919,611 |  |  | 595,835 |  |  | 51,089 |  |  | (1,209,580) |  |  | 7,338,719 |
Selling, general and administrative expenses |  | 50,740 |  |  | 1,384 |  |  | 7,345 |  |  | 38,209 |  |  | 2,925 |  |  | 4,255 |  |  | 104,858 |
Depreciation and amortization |  | 122,215 |  |  | 19,786 |  |  | 6,374 |  |  | 22,716 |  |  | 14,943 |  |  | 19,286 |  |  | 205,320 |
Income (loss) from operations |  | $ | 64,728 |  |  | $ | (14,530) |  |  | $ | 9,032 |  |  | $ | 74,639 |  |  | $ | 89,224 |  |  | $ | (26,159) |  |  | $ | 196,934 |
Earnings of equity method investments |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 7,158 |  |  | $ | 957 |  |  | $ | 8,115 |
Capital expenditures |  | $ | 35,694 |  |  | $ | 3,271 |  |  | $ | 12,960 |  |  | $ | 7,173 |  |  | $ | 11,144 |  |  | $ | 13,967 |  |  | $ | 84,209 |
Three Months Ended June 30, 2023 |  |  |  |  |  |  |  |  |  |
Sales and other revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from external customers |  | $ | 5,901,713 |  |  | $ | 175,063 |  |  | $ | 1,040,933 |  |  | $ | 686,104 |  |  | $ | 29,833 |  |  | $ | — |  |  | $ | 7,833,646 |
Intersegment revenues and other (1) |  | 1,137,669 |  |  | 98,122 |  |  | — |  |  | 4,529 |  |  | 106,540 |  |  | (1,346,860) |  |  | — |
|  | $ | 7,039,382 |  |  | $ | 273,185 |  |  | $ | 1,040,933 |  |  | $ | 690,633 |  |  | $ | 136,373 |  |  | $ | (1,346,860) |  |  | $ | 7,833,646 |
Cost of sales (exclusive of depreciation and amortization):
Cost of materials and other (exclusive of lower of cost or market inventory valuation adjustment) |  | 5,842,573 |  |  | 258,806 |  |  | 1,008,306 |  |  | 510,581 |  |  | — |  |  | (1,346,661) |  |  | 6,273,605 |
Lower of cost or market inventory valuation adjustment |  | 26,842 |  |  | (34,705) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (7,863) |
Operating expenses |  | 411,324 |  |  | 24,373 |  |  | — |  |  | 64,034 |  |  | 45,853 |  |  | 1,216 |  |  | 546,800 |
|  | 6,280,739 |  |  | 248,474 |  |  | 1,008,306 |  |  | 574,615 |  |  | 45,853 |  |  | (1,345,445) |  |  | 6,812,542 |
Selling, general and administrative expenses |  | 53,038 |  |  | 1,336 |  |  | 8,127 |  |  | 44,914 |  |  | 5,512 |  |  | 14,461 |  |  | 127,388 |
Depreciation and amortization |  | 112,542 |  |  | 18,968 |  |  | 6,016 |  |  | 20,379 |  |  | 21,819 |  |  | 9,636 |  |  | 189,360 |
Income (loss) from operations |  | $ | 593,063 |  |  | $ | 4,407 |  |  | $ | 18,484 |  |  | $ | 50,725 |  |  | $ | 63,189 |  |  | $ | (25,512) |  |  | $ | 704,356 |
Earnings of equity method investments |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 3,545 |  |  | $ | — |  |  | $ | 3,545 |
Capital expenditures |  | $ | 45,187 |  |  | $ | 3,537 |  |  | $ | 6,200 |  |  | $ | 5,734 |  |  | $ | 8,650 |  |  | $ | 10,873 |  |  | $ | 80,181 |
|  | Refining |  | Renewables |  | Marketing |  | Lubricants & Specialties |  | Midstream |  | Corporate, Other and Eliminations |  | Consolidated Total
|  | (In thousands)
Six Months Ended June 30, 2024 |  |  |  |  |  |  |  |  |  |  |  |
Sales and other revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from external customers |  | $ | 11,343,123 |  |  | $ | 359,897 |  |  | $ | 1,718,169 |  |  | $ | 1,401,594 |  |  | $ | 50,193 |  |  | $ | — |  |  | $ | 14,872,976 |
Intersegment revenues and other (1) |  | 1,838,931 |  |  | 127,940 |  |  | — |  |  | 7,792 |  |  | 263,003 |  |  | (2,237,666) |  |  | — |
|  | $ | 13,182,054 |  |  | $ | 487,837 |  |  | $ | 1,718,169 |  |  | $ | 1,409,386 |  |  | $ | 313,196 |  |  | $ | (2,237,666) |  |  | $ | 14,872,976 |
Cost of sales (exclusive of depreciation and amortization):
Cost of materials and other (exclusive of lower of cost or market inventory valuation adjustment) |  | 11,765,551 |  |  | 450,329 |  |  | 1,672,141 |  |  | 1,024,236 |  |  | — |  |  | (2,235,232) |  |  | 12,677,025 |
Lower of cost or market inventory valuation adjustment |  | (220,558) |  |  | (1,935) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (222,493) |
Operating expenses |  | 921,183 |  |  | 51,166 |  |  | — |  |  | 128,445 |  |  | 96,607 |  |  | 1,028 |  |  | 1,198,429 |
|  | 12,466,176 |  |  | 499,560 |  |  | 1,672,141 |  |  | 1,152,681 |  |  | 96,607 |  |  | (2,234,204) |  |  | 13,652,961 |
Selling, general and administrative expenses |  | 99,457 |  |  | 2,786 |  |  | 15,101 |  |  | 72,777 |  |  | 6,854 |  |  | 11,257 |  |  | 208,232 |
Depreciation and amortization |  | 239,585 |  |  | 40,058 |  |  | 12,677 |  |  | 45,227 |  |  | 35,063 |  |  | 31,439 |  |  | 404,049 |
Income (loss) from operations |  | $ | 376,836 |  |  | $ | (54,567) |  |  | $ | 18,250 |  |  | $ | 138,701 |  |  | $ | 174,672 |  |  | $ | (46,158) |  |  | $ | 607,734 |
Earnings of equity method investments |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 14,546 |  |  | $ | 915 |  |  | $ | 15,461 |
Capital expenditures |  | $ | 90,718 |  |  | $ | 5,921 |  |  | $ | 20,491 |  |  | $ | 12,484 |  |  | $ | 19,249 |  |  | $ | 24,454 |  |  | $ | 173,317 |
Six Months Ended June 30, 2023 |  |  |  |  |  |  |  |  |  |  |  |
Sales and other revenues: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenues from external customers |  | $ | 11,566,927 |  |  | $ | 377,476 |  |  | $ | 1,978,318 |  |  | $ | 1,419,818 |  |  | $ | 56,249 |  |  | $ | — |  |  | $ | 15,398,788 |
Intersegment revenues and other (1) |  | 2,191,070 |  |  | 193,725 |  |  | — |  |  | 10,325 |  |  | 216,056 |  |  | (2,611,176) |  |  | — |
|  | $ | 13,757,997 |  |  | $ | 571,201 |  |  | $ | 1,978,318 |  |  | $ | 1,430,143 |  |  | $ | 272,305 |  |  | $ | (2,611,176) |  |  | $ | 15,398,788 |
Cost of sales (exclusive of depreciation and amortization):
Cost of materials and other (exclusive of lower of cost or market inventory valuation adjustment) |  | 11,483,704 |  |  | 521,544 |  |  | 1,932,355 |  |  | 1,049,441 |  |  | — |  |  | (2,609,382) |  |  | 12,377,662 |
Lower of cost or market inventory valuation adjustment |  | 26,842 |  |  | 12,892 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 39,734 |
Operating expenses |  | 913,083 |  |  | 55,744 |  |  | — |  |  | 127,627 |  |  | 87,532 |  |  | 2,197 |  |  | 1,186,183 |
|  | 12,423,629 |  |  | 590,180 |  |  | 1,932,355 |  |  | 1,177,068 |  |  | 87,532 |  |  | (2,607,185) |  |  | 13,603,579 |
Selling, general and administrative expenses |  | 92,116 |  |  | 2,251 |  |  | 15,090 |  |  | 84,178 |  |  | 10,147 |  |  | 19,519 |  |  | 223,301 |
Depreciation and amortization |  | 212,625 |  |  | 38,942 |  |  | 11,887 |  |  | 39,747 |  |  | 41,581 |  |  | 18,561 |  |  | 363,343 |
Income (loss) from operations |  | $ | 1,029,627 |  |  | $ | (60,172) |  |  | $ | 18,986 |  |  | $ | 129,150 |  |  | $ | 133,045 |  |  | $ | (42,071) |  |  | $ | 1,208,565 |
Earnings of equity method investments |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 7,427 |  |  | $ | — |  |  | $ | 7,427 |
Capital expenditures |  | $ | 112,961 |  |  | $ | 8,381 |  |  | $ | 11,455 |  |  | $ | 14,383 |  |  | $ | 16,264 |  |  | $ | 16,806 |  |  | $ | 180,250 |
(1)Includes income earned by certain of our subsidiaries in the Midstream segment related to intercompany transportation agreements with certain of our subsidiaries in the Refining and Lubricants & Specialties segments that represent leases. These transactions eliminate in consolidation.

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