Par Pacific Announces 2024 Capital Expenditure Guidance
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Insights
The guidance provided by Par Pacific Holdings on capital expenditures and turnaround outlays for 2024 suggests a significant allocation of resources towards maintaining and expanding their operations. The earmarked funds for turnarounds and catalysts, maintenance and growth initiatives indicate a proactive approach to asset management and strategic investment in future capabilities, particularly in renewable energy with the Hawaii renewable hydrotreater project.
Investors may interpret this guidance as a commitment to operational excellence and long-term competitiveness, potentially influencing the stock's performance. However, the high-end of the guidance range could signal substantial cash outflows, which might raise concerns over the company's short-term liquidity and debt levels. It is crucial to compare these figures with the company's cash flow projections and debt covenants to assess the financial health and risk profile.
The breakdown of expenditures reveals that Par Pacific is dedicating a substantial portion of its budget to turnarounds and catalysts, which are critical for ensuring the ongoing efficiency and reliability of refinery operations. This is a common practice in the industry to mitigate the risk of unscheduled outages and to comply with regulatory requirements.
The investment in the Hawaii renewable hydrotreater project is particularly noteworthy as it aligns with the broader industry trend towards sustainable energy solutions. This project could position Par Pacific favorably within the evolving energy landscape and potentially open up new revenue streams. However, the success of such growth initiatives hinges on technology viability, regulatory approvals and market adoption rates.
From an economic perspective, Par Pacific's capital expenditure and turnaround outlay guidance reflect broader economic trends, such as the importance of infrastructure investment and the transition towards renewable energy. The allocation of funds towards growth initiatives like the renewable hydrotreater project suggests an anticipation of increasing demand for cleaner fuels, which could be influenced by both market forces and policy changes.
Their financial commitment to maintenance and turnarounds also indicates an understanding that reliability and efficiency are key drivers of profitability in the energy sector. These investments can have a positive long-term impact on operational costs and help mitigate the risks associated with aging infrastructure.
HOUSTON, Dec. 21, 2023 (GLOBE NEWSWIRE) -- Par Pacific Holdings, Inc. (NYSE: PARR) (“Par Pacific”) today announced its 2024 capital expenditure and turnaround outlay guidance with a range of
| 2024 Capital Expenditure and Turnaround Outlay Guidance | |
| $ in millions | |
| Turnarounds & Catalyst ¹ | |
| Maintenance ² | 85 - 90 |
| Growth ³ | 60 - 70 |
| Total Capital Expenditure and Turnaround Outlay | |
¹ Includes pre-turnaround spend related to the 2025 Hawaii turnaround. ² Includes Billings reliability investments. ³ Includes capital spend for the Hawaii renewable hydrotreater project. | |
About Par Pacific
Par Pacific Holdings, Inc. (NYSE: PARR), headquartered in Houston, Texas, is a growing energy company providing both renewable and conventional fuels to the western United States. In the Pacific Northwest and the Rockies, Par Pacific owns and operates 124,000 bpd of combined refining capacity across three locations and an extensive energy infrastructure network, including 7.6 million barrels of storage, and marine, rail, rack, and pipeline assets. In addition, Par Pacific operates the “nomnom” convenience store chain and supplies ExxonMobil-branded fuel retail stations in the region. Par Pacific owns and operates one of the largest energy infrastructure networks in Hawaii with 94,000 bpd of operating refining capacity, a logistics system supplying the major islands of the state and Hele-branded retail locations. Par Pacific also owns
Forward-Looking Statements
This news release includes certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements include, without limitation, statements about Par Pacific’s anticipated 2024 capital expenditures and turnaround costs. We cannot provide assurances that the assumptions upon which these forward-looking statements are based will prove to have been correct. Should underlying assumptions prove incorrect, actual results may vary materially from those expressed or implied in any forward-looking statements, and investors are cautioned not to place undue reliance on these forward-looking statements, which are current only as of this date. We do not intend to update or revise any forward-looking statements made herein or any other forward-looking statements because of new information, future events or otherwise. We further expressly disclaim any written or oral statements made by a third party regarding the subject matter of this news release.
For more information contact:
Ashimi Patel
Director, Investor Relations and Renewables
(832) 916-3355
apatel@parpacific.com
FAQ
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