Derivatives | 9 Months Ended |
Sep. 30, 2014 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' |
Derivatives | ' |
Derivatives |
The Company is exposed to price risks due to fluctuations in the price of crude oil, refined products (primarily in the Company’s fuel products segment) and natural gas. The Company uses various strategies to reduce its exposure to commodity price risk. The strategies to reduce the Company’s risk utilize both physical forward contracts and financially settled derivative instruments, such as swaps, collars and options, to attempt to reduce the Company’s exposure with respect to: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
• | crude oil purchases and sales; | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
• | fuel product sales and purchases; | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
• | natural gas purchases; and | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
•fluctuations in the value of crude oil between geographic regions and between the different types of crude oil such as NYMEX West Texas Intermediate (“NYMEX WTI”), Light Louisiana Sweet (“LLS”), Western Canadian Select (“WCS”), Mixed Sweet Blend (“MSW”) and ICE Brent (“Brent”). |
The Company manages its exposure to commodity markets, credit, volumetric and liquidity risks to manage its costs and volatility of cash flows as conditions warrant or opportunities become available. These risks may be managed in a variety of ways that may include the use of derivative instruments. Derivative instruments may be used for the purpose of mitigating risks associated with an asset, liability, and anticipated future transactions and the changes in fair value of the Company’s derivative instruments will affect its earnings and cash flows; however, such changes should be offset by price or rate changes related to the underlying commodity or financial transaction that is part of the risk management strategy. The Company does not speculate with derivative instruments or other contractual arrangements that are not associated with its business objectives. Speculation is defined as increasing the Company’s natural position above the maximum position of its physical assets or trading in commodities, currencies or other risk bearing assets that are not associated with the Company’s business activities and objectives. The Company’s positions are monitored routinely by a risk management committee to ensure compliance with its stated risk management policy and documented risk management strategies. All strategies are reviewed on an ongoing basis by the Company’s risk management committee, which will add, remove or revise strategies in anticipation of changes in market conditions and/or in risk profiles. These changes in strategies are to position the Company in relation to its risk exposures in an attempt to capture market opportunities as they arise. |
The governance over commodity and derivative activities includes regular monitoring of the performance of the Company’s risk management strategies and transaction limits regarding dollars and volume based authority, commodity positions, crack spread positions and other various risk management performance measures. The Company’s risk management results are reviewed monthly by its risk management committee and summarized and reviewed quarterly with the Board of Directors of the Company’s general partner. |
The Company recognizes all derivative instruments at their fair values (see Note 11) as either current assets or current liabilities in the condensed consolidated balance sheets. Fair value includes any premiums paid or received and unrealized gains and losses. Fair value does not include any amounts receivable from or payable to counterparties, or collateral provided to counterparties. Derivative asset and liability amounts with the same counterparty are netted against each other for financial reporting purposes. The Company’s financial results are subject to the possibility that changes in a derivative’s fair value could result in significant ineffectiveness and potentially no longer qualify it for hedge accounting. |
The following tables summarize the Company’s gross fair values of its derivative instruments, presenting the impact of offsetting derivative assets in the Company’s condensed consolidated balance sheets as of September 30, 2014 and December 31, 2013 (in millions): |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 30-Sep-14 | | 31-Dec-13 | | | | | | | | | | | | | |
| | Gross Amounts of Recognized Assets | | Gross Amounts Offset in the Condensed Consolidated Balance Sheets | | Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheets | | Gross Amounts of Recognized Assets | | Gross Amounts Offset in the Condensed Consolidated Balance Sheets | | Net Amounts of Assets Presented in the Condensed Consolidated Balance Sheets | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Derivative instruments designated as hedges: | | | | | | | | | | | | | | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | | $ | 7.5 | | | $ | (28.5 | ) | | $ | (21.0 | ) | | $ | 45.4 | | | $ | (45.4 | ) | | $ | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Gasoline swaps | | 23.6 | | | — | | | 23.6 | | | 1 | | | (1.0 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Diesel swaps | | 39.3 | | | (0.1 | ) | | 39.2 | | | 3.5 | | | (3.5 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Jet fuel swaps | | 6 | | | — | | | 6 | | | 0.1 | | | (0.1 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Total derivative instruments designated as hedges | | 76.4 | | | (28.6 | ) | | 47.8 | | | 50 | | | (50.0 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Derivative instruments not designated as hedges: | | | | | | | | | | | | | | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | | 0.4 | | | (2.0 | ) | | (1.6 | ) | | 6.3 | | | (6.3 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Crude oil basis swaps | | 2.8 | | | — | | | 2.8 | | | 1 | | | (1.0 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Diesel swaps | | 8.7 | | | (0.6 | ) | | 8.1 | | | 0.7 | | | (0.7 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Jet fuel swaps | | — | | | — | | | — | | | 0.9 | | | (0.9 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Diesel crack spread collars | | 0.7 | | | (0.7 | ) | | — | | | 0.3 | | | (0.3 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Specialty products segment: | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Natural gas swaps | | 0.3 | | | (2.6 | ) | | (2.3 | ) | | 0.4 | | | (0.4 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Natural gas collars | | 0.5 | | | (0.5 | ) | | — | | | — | | | — | | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Total derivative instruments not designated as hedges | | 13.4 | | | (6.4 | ) | | 7 | | | 9.6 | | | (9.6 | ) | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Total derivative instruments | | $ | 89.8 | | | $ | (35.0 | ) | | $ | 54.8 | | | $ | 59.6 | | | $ | (59.6 | ) | | $ | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
The following tables summarize the Company’s gross fair values of its derivative instruments, presenting the impact of offsetting derivative liabilities in the Company’s condensed consolidated balance sheets as of September 30, 2014 and December 31, 2013 (in millions): |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 30-Sep-14 | | 31-Dec-13 | | | | | | | | | | | | | |
| | Gross Amounts of Recognized Liabilities | | Gross Amounts Offset in the Condensed Consolidated Balance Sheets | | Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheets | | Gross Amounts of Recognized Liabilities | | Gross Amounts Offset in the Condensed Consolidated Balance Sheets | | Net Amounts of Liabilities Presented in the Condensed Consolidated Balance Sheets | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Derivative instruments designated as hedges: | | | | | | | | | | | | | | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | | $ | (28.5 | ) | | $ | 28.5 | | | $ | — | | | $ | (13.0 | ) | | $ | 45.4 | | | $ | 32.4 | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Gasoline swaps | | — | | | — | | | — | | | (19.7 | ) | | 1 | | | (18.7 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Diesel swaps | | (0.1 | ) | | 0.1 | | | — | | | (51.3 | ) | | 3.5 | | | (47.8 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Jet fuel swaps | | — | | | — | | | — | | | (13.4 | ) | | 0.1 | | | (13.3 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Swaps not allocated to a specific segment: | | | | | | | | | | | | | | | | | | | | | | | |
Interest rate swap | | (0.6 | ) | | — | | | (0.6 | ) | | — | | | — | | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Total derivative instruments designated as hedges | (29.2 | ) | | 28.6 | | | (0.6 | ) | | (97.4 | ) | | 50 | | | (47.4 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Derivative instruments not designated as hedges: | | | | | | | | | | | | | | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | | (2.0 | ) | | 2 | | | — | | | (1.7 | ) | | 6.3 | | | 4.6 | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Crude oil basis swaps | | — | | | — | | | — | | | (0.6 | ) | | 1 | | | 0.4 | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Gasoline swaps | | — | | | — | | | — | | | (9.4 | ) | | — | | | (9.4 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Diesel swaps | | (0.6 | ) | | 0.6 | | | — | | | (3.5 | ) | | 0.7 | | | (2.8 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Jet fuel swaps | | — | | | — | | | — | | | — | | | 0.9 | | | 0.9 | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Diesel crack spread collars | | (0.7 | ) | | 0.7 | | | — | | | (0.2 | ) | | 0.3 | | | 0.1 | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Specialty products segment: | | | | | | | | | | | | | | | | | | | | | | | | | |
Natural gas swaps | | (2.6 | ) | | 2.6 | | | — | | | (1.6 | ) | | 0.4 | | | (1.2 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Natural gas collars | | (0.5 | ) | | 0.5 | | | — | | | — | | | — | | | — | | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Total derivative instruments not designated as hedges | (6.4 | ) | | 6.4 | | | — | | | (17.0 | ) | | 9.6 | | | (7.4 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
Total derivative instruments | $ | (35.6 | ) | | $ | 35 | | | $ | (0.6 | ) | | $ | (114.4 | ) | | $ | 59.6 | | | $ | (54.8 | ) | | | | | | | | | | | | | |
| | | | | | | | | | | | |
The Company is exposed to credit risk in the event of nonperformance by its counterparties on these derivative transactions. The Company does not expect nonperformance on any derivative instruments, however, no assurances can be provided. The Company’s credit exposure related to these derivative instruments is represented by the fair value of contracts reported as derivative assets. As of September 30, 2014, the Company had eight counterparties in which derivatives held were net assets, totaling $54.8 million. As of December 31, 2013, the Company had no counterparties in which the derivatives held were net assets. To manage credit risk, the Company selects and periodically reviews counterparties based on credit ratings. The Company primarily executes its derivative instruments with large financial institutions that have ratings of at least Baa2 and A- by Moody’s and S&P, respectively. In the event of default, the Company would potentially be subject to losses on derivative instruments with mark to market gains. The Company requires collateral from its counterparties when the fair value of the derivatives exceeds agreed upon thresholds in its master derivative contracts with these counterparties. No such collateral was held by the Company as of September 30, 2014 or December 31, 2013. The Company’s contracts with these counterparties allow for netting of derivative instruments executed under each contract. Collateral received from counterparties is reported in other current liabilities, and collateral held by counterparties is reported in deposits, on the Company’s condensed consolidated balance sheets and is not netted against derivative assets or liabilities. As of September 30, 2014 and December 31, 2013, the Company had provided its counterparties with no collateral. For financial reporting purposes, the Company does not offset the collateral provided to a counterparty against the fair value of its obligation to that counterparty. Any outstanding collateral is released to the Company upon settlement of the related derivative instrument liability. |
Certain of the Company’s outstanding derivative instruments are subject to credit support agreements with the applicable counterparties which contain provisions setting certain credit thresholds above which the Company may be required to post agreed-upon collateral, such as cash or letters of credit, with the counterparty to the extent that the Company’s mark-to-market net liability, if any, on all outstanding derivatives exceeds the credit threshold amount per such credit support agreement. The majority of the credit support agreements covering the Company’s outstanding derivative instruments also contain a general provision stating that if the Company experiences a material adverse change in its business, in the reasonable discretion of the counterparty, the Company’s credit threshold could be lowered by such counterparty. The Company does not expect that it will experience a material adverse change in its business. |
The cash flow impact of the Company’s derivative activities is classified primarily as a change in derivative activity in the operating activities section in the unaudited condensed consolidated statements of cash flows. |
Derivative Instruments Designated as Cash Flow Hedges |
The Company accounts for certain derivatives hedging purchases of crude oil and sales of gasoline, diesel and jet fuel swaps as cash flow hedges. The derivative instruments designated as cash flow hedges that are hedging sales and purchases are recorded to sales and cost of sales, respectively, in the unaudited condensed consolidated statements of operations upon recording the related hedged transaction in sales or cost of sales. The Company assesses, both at inception of the cash flow hedge and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of hedged items. Periodically, the Company may enter into crude oil and fuel product basis swaps to more effectively hedge its crude oil purchases, crude oil sales and fuel products sales. These derivatives can be combined with a swap contract in order to create a more effective cash flow hedge. |
To the extent a derivative instrument designated as a cash flow hedge is determined to be effective as a cash flow hedge of an exposure to changes in the fair value of a future transaction, the change in fair value of the derivative is deferred in accumulated other comprehensive income (loss), a component of partners’ capital in the condensed consolidated balance sheets, until the underlying transaction hedged is recognized in the unaudited condensed consolidated statements of operations. |
Ineffectiveness is inherent in the hedging of crude oil and fuel products. Due to the volatility in the markets for crude oil and fuel products, the Company is unable to predict the amount of ineffectiveness each period, determined on a derivative by derivative basis or in the aggregate for a specific commodity, and has the potential for the future loss of cash flow hedge accounting. Ineffectiveness has resulted, and the loss of cash flow hedge accounting has resulted, in increased volatility in the Company’s financial results. However, even though certain derivative instruments may not qualify for cash flow hedge accounting, the Company intends to continue to utilize such instruments as management believes such derivative instruments continue to provide the Company with the opportunity to more effectively stabilize cash flows. |
Cash flow hedge accounting is discontinued when it is determined that a derivative no longer qualifies as an effective hedge or when it is no longer probable that the hedged forecasted transaction will occur. When cash flow hedge accounting is discontinued because the derivative instrument no longer qualifies as an effective cash flow hedge, the derivative instrument is subject to the mark-to-market method of accounting prospectively. Changes in the mark-to-market fair value of the derivative instrument are recorded to unrealized gain (loss) on derivative instruments in the unaudited condensed consolidated statements of operations. Unrealized gains and losses related to discontinued cash flow hedges that were previously deferred in accumulated other comprehensive income (loss) will remain in accumulated other comprehensive income (loss) until the underlying transaction is reflected in earnings, unless it is probable that the hedged forecasted transaction will not occur, at which time, associated deferred amounts in accumulated other comprehensive income (loss) are immediately recognized in unrealized gain (loss) on derivative instruments. |
The Company recorded the following amounts in its condensed consolidated balance sheets, unaudited condensed consolidated statements of operations, unaudited condensed consolidated statements of comprehensive income (loss) and unaudited condensed consolidated statements of partners’ capital as of, and for the three months ended September 30, 2014 and 2013 related to its derivative instruments that were designated as cash flow hedges (in millions): |
|
| | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Type of Derivative | Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivatives (Effective Portion) | | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Net Income (Effective Portion) | | Amount of Gain (Loss) Recognized in Net Income on Derivatives (Ineffective Portion) | | | | | | | | | | |
Three Months Ended | | Location of Gain (Loss) | | Three Months Ended | | Location of Gain (Loss) | | Three Months Ended | | | | | | | | | | |
September 30, | | | September 30, | | | September 30, | | | | | | | | | | |
2014 | | 2013 | | | 2014 | | 2013 | | | 2014 | | 2013 | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | $ | (83.9 | ) | | $ | 59.2 | | | Cost of sales | | $ | 10.9 | | | $ | 11.1 | | | Unrealized/ Realized | | $ | (35.3 | ) | | $ | 11.3 | | | | | | | | | | | |
| | | | | | | | | |
Gasoline swaps | 37 | | | (0.3 | ) | | Sales | | (3.8 | ) | | (0.1 | ) | | Unrealized/ Realized | | (4.4 | ) | | (0.6 | ) | | | | | | | | | | |
| | | | | | | | | |
Diesel swaps | 75.1 | | | (33.1 | ) | | Sales | | (1.1 | ) | | (4.4 | ) | | Unrealized/ Realized | | 13.4 | | | (0.6 | ) | | | | | | | | | | |
| | | | | | | | | |
Jet fuel swaps | 12.2 | | | (11.7 | ) | | Sales | | (0.7 | ) | | (0.2 | ) | | Unrealized/ Realized | | 2 | | | (0.5 | ) | | | | | | | | | | |
| | | | | | | | | |
Specialty products segment: | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | — | | | — | | | Cost of sales | | 1.2 | | | (0.8 | ) | | Unrealized/ Realized | | — | | | — | | | | | | | | | | | |
| | | | | | | | | |
Total | $ | 40.4 | | | $ | 14.1 | | | | | $ | 6.5 | | | $ | 5.6 | | | | | $ | (24.3 | ) | | $ | 9.6 | | | | | | | | | | | |
| | | | | | | | | |
The Company recorded the following amounts in its condensed consolidated balance sheets, unaudited condensed consolidated statements of operations, unaudited condensed consolidated statements of comprehensive income (loss) and unaudited condensed consolidated statements of partners’ capital as of and for the nine months ended September 30, 2014 and 2013 related to its derivative instruments that were designated as cash flow hedges (in millions): |
| | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Type of Derivative | Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivatives (Effective Portion) | | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Net Income (Effective Portion) | | Amount of Gain (Loss) Recognized in Net Income (Loss) on Derivatives (Ineffective Portion) | | | | | | | | | | |
Nine Months Ended | | Location of Gain (Loss) | | Nine Months Ended | | Location of Gain (Loss) | | Nine Months Ended | | | | | | | | | | |
September 30, | | | September 30, | | | September 30, | | | | | | | | | | |
2014 | | 2013 | | | 2014 | | 2013 | | | 2014 | | 2013 | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | $ | (12.7 | ) | | $ | 32.5 | | | Cost of sales | | $ | 34 | | | $ | (2.5 | ) | | Unrealized/ Realized | | $ | 12.4 | | | $ | (16.5 | ) | | | | | | | | | | |
| | | | | | | | | |
Gasoline swaps | 27 | | | (0.7 | ) | | Sales | | (15.3 | ) | | (0.2 | ) | | Unrealized/ Realized | | (8.9 | ) | | (1.2 | ) | | | | | | | | | | |
| | | | | | | | | |
Diesel swaps | 61.7 | | | 8.5 | | | Sales | | (12.2 | ) | | (3.0 | ) | | Unrealized/ Realized | | 13.3 | | | (3.9 | ) | | | | | | | | | | |
| | | | | | | | | |
Jet fuel swaps | 14.9 | | | 1 | | | Sales | | (2.8 | ) | | 1.8 | | | Unrealized/ Realized | | 1.6 | | | 6 | | | | | | | | | | | |
| | | | | | | | | |
Specialty products segment: | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | — | | | — | | | Cost of sales | | — | | | (0.5 | ) | | Unrealized/ Realized | | — | | | — | | | | | | | | | | | |
| | | | | | | | | |
Total | $ | 90.9 | | | $ | 41.3 | | | | | $ | 3.7 | | | $ | (4.4 | ) | | | | $ | 18.4 | | | $ | (15.6 | ) | | | | | | | | | | |
| | | | | | | | | |
The effective portion of the cash flow hedges classified in accumulated other comprehensive income (loss) was a gain of $35.8 million and a loss of $51.4 million as of September 30, 2014 and December 31, 2013, respectively. Absent a change in the fair market value of the underlying transactions, except for any underlying transactions pertaining to the payment of interest on existing financial instruments, the following other comprehensive income at September 30, 2014 will be reclassified to earnings by December 31, 2016 with balances being recognized as follows (in millions): |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Year | Accumulated Other Comprehensive Income (Loss) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
2014 | $ | 20.6 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
2015 | 13.2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
2016 | 2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | $ | 35.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Based on fair values as of September 30, 2014, the Company expects to reclassify $32.4 million of net gains on derivative instruments from accumulated other comprehensive income (loss) to earnings during the next twelve months due to actual crude oil purchases, diesel, gasoline and jet fuel sales. However, the amounts actually realized will be dependent on the fair values as of the dates of settlement. |
|
Derivative Instruments Designated as Fair Value Hedges |
For derivative instruments that are designated and qualify as a fair value hedge, the effective gain or loss on the derivative instrument, as well as the offsetting gain or loss on the hedged item attributable to the hedged risk are recognized as interest expense in the unaudited condensed consolidated statements of operations. No hedge ineffectiveness was recognized as the interest rate swap qualifies for the “shortcut” method and, as a result, changes in the fair value of the derivative instrument offset the changes in the fair value of the underlying hedged debt. In addition, the differential to be paid or received on the interest rate swap arrangement is accrued and recognized as an adjustment to interest expense in the unaudited condensed consolidated statements of operations. The Company assesses at the inception of the fair value hedge whether the derivatives that are used in the hedging transactions are highly effective in offsetting changes in fair values of hedged items. |
Fair value hedge accounting is discontinued when it is determined that a derivative no longer qualifies as an effective hedge or when it is no longer probable that the hedged forecasted transaction will occur. When fair value hedge accounting is discontinued because the derivative instrument no longer qualifies as effective fair value hedge, the derivative instrument is still subject to mark-to-market method of accounting, however the Company will cease to adjust the hedged asset or liability for changes in fair value. |
In 2014, the Company entered into an interest rate swap agreement which converts a portion of the Company’s fixed rate debt to a floating rate. This agreement involves the receipt of fixed rate amounts in exchange for floating rate interest payments over the life of the agreement without an exchange of the underlying principal amount. Also, in connection with the interest rate swap agreement, the Company entered into an option that permits the counterparty to cancel the interest rate swap for a specified premium. The Company designated this interest rate swap and option as a fair value hedge. As of September 30, 2014, the total notional amount of the Company’s receive-fixed/pay-variable interest rate swap was $200.0 million with a maturity date of January 15, 2022. |
The Company recorded the following gains (losses) in its unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2014 and 2013 related to its derivative instrument designated as a fair value hedge (in millions): |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Location of Gain (Loss) of Derivative | | Amount of Loss Recognized in Net Income (Loss) | | Hedged Item | | Location of Gain (Loss) on Hedged Item | | Amount of Gain Recognized in Net Income (Loss) |
|
| Three Months Ended September 30, | | Nine Months Ended September 30, | | | Three Months Ended September 30, | | Nine Months Ended September 30, |
|
| 2014 | | 2013 | | 2014 | | 2013 | | | 2014 | | 2013 | | 2014 | | 2013 |
|
Swaps not allocated to a specific segment: | | | | | | | | | | | | | | | | | | |
|
Interest rate swap | Interest expense | | $ | — | | | $ | — | | | $ | (0.6 | ) | | $ | — | | | 2022 Notes | | Interest income | | $ | — | | | $ | — | | | $ | 0.6 | | | $ | — | |
|
Total | | | $ | — | | | $ | — | | | $ | (0.6 | ) | | $ | — | | | | | | | $ | — | | | $ | — | | | $ | 0.6 | | | $ | — | |
|
Derivative Instruments Not Designated as Hedges |
For derivative instruments not designated as hedges, the change in fair value of the asset or liability for the period is recorded to unrealized gain (loss) on derivative instruments in the unaudited condensed consolidated statements of operations. Upon the settlement of a derivative not designated as a hedge, the gain or loss at settlement is recorded to realized gain (loss) on derivative instruments in the unaudited condensed consolidated statements of operations. The Company has entered into crude oil basis swaps that do not qualify as cash flow hedges for accounting purposes as they were not entered into simultaneously with a corresponding NYMEX WTI derivative contract. Additionally, the Company has entered into diesel crack spread collars, gasoline crack spread collars, natural gas collars, and certain other crude oil swaps, diesel swaps and gasoline swaps that do not qualify as cash flow hedges for accounting purposes as they are determined not to be highly effective in offsetting changes in the cash flows associated with crude oil purchases and gasoline and diesel sales at the Company’s Superior refinery. |
Effective January 1, 2012, cash flow hedge accounting was discontinued prospectively for certain crude oil derivative instruments when it was determined that they were no longer highly effective in offsetting changes in the cash flows associated with crude oil purchases at the Company’s Superior refinery due to the volatility in crude oil pricing differentials between heavy crude oil and NYMEX WTI. Effective April 1, 2012, cash flow hedge accounting was discontinued prospectively for certain gasoline and diesel derivative instruments associated with gasoline and diesel sales at the Company’s Superior refinery. The discontinuance of cash flow hedge accounting on these existing derivative instruments has caused the Company to recognize the following gains and losses in the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2013 (in millions): |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2013 | | 2013 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Realized gain on derivative instruments | $ | 0.5 | | | $ | 1.5 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Unrealized gain (loss) on derivative instruments | $ | (3.0 | ) | | $ | 3.1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The amount reclassified from accumulated other comprehensive income (loss) into earnings, as a result of the discontinuance of cash flow hedge accounting for certain crude oil, gasoline, jet fuel and diesel derivative instruments at the Shreveport refinery because it was no longer probable that the original forecasted transaction would occur by the end of the originally specified time period, caused the Company to recognize the following gains and losses in the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2014 (in millions): |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2014 | | 2014 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Realized gain (loss) on derivative instruments | $ | 1 | | | $ | (2.3 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Unrealized gain on derivative instruments | $ | 3.4 | | | $ | 2.1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
The Company recorded the following gains (losses) in its unaudited condensed consolidated statements of operations for the three months ended September 30, 2014 and 2013 related to its derivative instruments not designated as hedges (in millions): |
|
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Type of Derivative | Amount of Gain (Loss) Recognized in Realized Gain on Derivative Instruments | | Amount of Gain (Loss) Recognized in Unrealized Gain (Loss) on Derivative Instruments | | | | | | | | | | | | | | | | | | | | | | |
Three Months Ended | | Three Months Ended | | | | | | | | | | | | | | | | | | | | | | |
September 30, | | September 30, | | | | | | | | | | | | | | | | | | | | | | |
2014 | | 2013 | | 2014 | | 2013 | | | | | | | | | | | | | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | $ | 3.7 | | | $ | 2 | | | $ | (21.0 | ) | | $ | 2.7 | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Crude oil basis swaps | 1.6 | | | (0.2 | ) | | 3 | | | (7.2 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Gasoline swaps | (4.6 | ) | | — | | | 8.4 | | | (0.4 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Diesel swaps | 2.6 | | | 0.9 | | | 13.3 | | | (1.1 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Jet fuel swaps | — | | | 0.7 | | | — | | | 0.5 | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Diesel crack spread collars | — | | | — | | | (0.5 | ) | | — | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Gasoline crack spread collars | — | | | — | | | (0.2 | ) | | — | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Specialty products segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | — | | | 0.1 | | | — | | | (0.1 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Natural gas swaps | (0.1 | ) | | — | | | (2.4 | ) | | (0.9 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Total | $ | 3.2 | | | $ | 3.5 | | | $ | 0.6 | | | $ | (6.5 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
The Company recorded the following gains (losses) in its unaudited condensed consolidated statements of operations for the nine months ended September 30, 2014 and 2013 related to its derivative instruments not designated as hedges (in millions): |
|
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Type of Derivative | Amount of Gain (Loss) Recognized in Realized Gain on Derivative Instruments | | Amount of Gain (Loss) Recognized in Unrealized Gain (Loss) on Derivative Instruments | | | | | | | | | | | | | | | | | | | | | | |
Nine Months Ended | | Nine Months Ended | | | | | | | | | | | | | | | | | | | | | | |
September 30, | | September 30, | | | | | | | | | | | | | | | | | | | | | | |
2014 | | 2013 | | 2014 | | 2013 | | | | | | | | | | | | | | | | | | | | | | |
Fuel products segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | $ | 18.1 | | | $ | (6.8 | ) | | $ | (6.5 | ) | | $ | 42.5 | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Crude oil basis swaps | 2.8 | | | 7.3 | | | 2.5 | | | (1.9 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Gasoline swaps | (15.8 | ) | | 2.9 | | | 9.4 | | | (0.4 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Diesel swaps | 1 | | | 6.4 | | | 10.8 | | | (4.5 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Jet fuel swaps | (0.5 | ) | | 0.7 | | | (0.9 | ) | | 0.4 | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Diesel crack spread collars | 1 | | | — | | | (0.1 | ) | | — | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Specialty products segment: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude oil swaps | — | | | 1.8 | | | — | | | (1.6 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Natural gas swaps | 1.2 | | | — | | | (1.1 | ) | | (2.9 | ) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Total | $ | 7.8 | | | $ | 12.3 | | | $ | 14.1 | | | $ | 31.6 | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | |
Derivative Positions - Specialty Products Segment |
Natural Gas Swap Contracts |
At September 30, 2014, the Company had the following derivatives related to natural gas purchases in its specialty products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Natural Gas Swap Contracts by Expiration Dates | MMBtu | | $/MMBtu | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 1,210,000 | | | $ | 4.19 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 4,930,000 | | | 4.23 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 4,340,000 | | | 4.32 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2017 | 1,830,000 | | | 4.28 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 12,310,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | $ | 4.27 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to natural gas purchases in its specialty products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Natural Gas Swap Contracts by Expiration Dates | MMBtu | | $/MMBtu | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 750,000 | | | $ | 4.14 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 750,000 | | | 4.14 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 750,000 | | | 4.14 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 850,000 | | | 4.21 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 3,500,000 | | | 4.27 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 2,700,000 | | | 4.42 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2017 | 1,000,000 | | | 4.29 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 10,300,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | $ | 4.28 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
Natural Gas Collar Contracts |
At September 30, 2014, the Company had the following natural gas collars related to natural gas purchases in its specialty products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Natural Gas Collars by Expiration Dates | MMBtu | | Average Bought Call ($/MMBtu) | | Average Sold Put ($/MMBtu) | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 160,000 | | | $ | 4.25 | | | $ | 3.79 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 920,000 | | | 4.25 | | | 3.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 600,000 | | | 4.25 | | | 3.89 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 1,680,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | $ | 4.25 | | | $ | 3.83 | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Derivative Positions - Fuel Products Segment |
Crude Oil Swap Contracts |
At September 30, 2014, the Company had the following derivatives related to crude oil purchases in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 2,346,000 | | | 25,500 | | | $ | 92.75 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 6,830,000 | | | 18,712 | | | 90.12 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 2,196,000 | | | 6,000 | | | 85.65 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 11,372,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 89.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At September 30, 2014, the Company had the following derivatives related to crude oil purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 184,000 | | | 2,000 | | | $ | 92.2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,004,000 | | | 2,751 | | | 89.28 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 1,188,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 89.74 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At September 30, 2014, the Company had the following derivatives related to crude oil sales in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 46,000 | | | 500 | | | $ | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 46,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to crude oil purchases in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 2,520,000 | | | 28,000 | | | $ | 92.06 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 2,411,500 | | | 26,500 | | | 91.97 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 2,530,000 | | | 27,500 | | | 91.23 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 2,024,000 | | | 22,000 | | | 90.61 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 5,556,500 | | | 15,223 | | | 89.08 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 1,830,000 | | | 5,000 | | | 84.73 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 16,872,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 89.97 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to crude oil purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 810,000 | | | 9,000 | | | $ | 94.56 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 591,500 | | | 6,500 | | | 94.37 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 874,000 | | | 9,500 | | | 92.92 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 184,000 | | | 2,000 | | | 94.62 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,004,000 | | | 2,751 | | | 89.28 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 3,463,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 92.59 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to crude oil sales in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 45,000 | | | 500 | | | $ | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 45,500 | | | 500 | | | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 46,000 | | | 500 | | | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 46,000 | | | 500 | | | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 182,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 96.9 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Basis Swap Contracts |
The Company has entered into crude oil basis swaps to mitigate the risk of future changes in pricing differentials between Canadian heavy crude oil and NYMEX WTI crude oil, pricing differentials between LLS and NYMEX WTI and pricing differentials between MSW and NYMEX WTI. At September 30, 2014, the Company had the following derivatives related to crude oil basis swaps in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Basis Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Differential to NYMEX WTI | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 366,000 | | | 6,000 | | | $ | (21.42 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 180,000 | | | 493 | | | (22.40 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 546,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average differential | | | | | $ | (21.74 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to crude oil basis swaps in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Basis Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Differential to NYMEX WTI | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 118,000 | | | 1,311 | | | $ | (28.50 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 184,000 | | | 2,000 | | | (21.75 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 184,000 | | | 2,000 | | | (21.50 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 486,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average differential | | | | | $ | (23.29 | ) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
|
As of December 31, 2013, the Company had approximately 248,000 barrels of crude oil basis swaps related to future crude oil purchases and sales to mitigate the risk of future changes in pricing differentials between Brent and NYMEX WTI on the Company’s reselling of crude oil. The net impact of these derivative instruments, none of which are designated as hedges, was a net loss of $0.6 million that was recorded to realized gain (loss) on derivative instruments in the unaudited condensed consolidated statements of operations for the nine months ended September 30, 2014. |
Diesel Swap Contracts |
At September 30, 2014, the Company had the following derivatives related to diesel sales in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 1,104,000 | | | 12,000 | | | $ | 116.39 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 4,781,500 | | | 13,100 | | | 115.81 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 2,196,000 | | | 6,000 | | | 112.88 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 8,081,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 115.1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At September 30, 2014, the Company had the following derivatives related to diesel sales in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 184,000 | | | 2,000 | | | $ | 120.38 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,004,000 | | | 2,751 | | | 117.15 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 1,188,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 117.65 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At September 30, 2014, the Company had the following derivatives related to diesel purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 46,000 | | | 500 | | | $ | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 46,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | | $ | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to diesel sales in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 1,125,000 | | | 12,500 | | | $ | 117.54 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 1,183,000 | | | 13,000 | | | 116.78 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 1,288,000 | | | 14,000 | | | 116.82 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 1,288,000 | | | 14,000 | | | 116.96 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 4,781,500 | | | 13,100 | | | 115.81 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2016 | 1,830,000 | | | 5,000 | | | 112 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 11,495,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 115.72 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to diesel sales in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 270,000 | | | 3,000 | | | $ | 121.72 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 182,000 | | | 2,000 | | | 123.22 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 230,000 | | | 2,500 | | | 121.74 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 184,000 | | | 2,000 | | | 123.02 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,004,000 | | | 2,751 | | | 117.15 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 1,870,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 119.54 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to diesel purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 45,000 | | | 500 | | | $ | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 45,500 | | | 500 | | | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 46,000 | | | 500 | | | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 46,000 | | | 500 | | | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 182,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 121.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Crack Spread Collars |
At September 30, 2014, the Company had the following diesel crack spread collars related to diesel sales and crude oil purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Crack Spread Collars by Expiration Dates | Barrels Purchased and Sold | | BPD | | Average Bought | | Average Sold | | | | | | | | | | | | | | | | | | | | | | | | |
Put ($/Bbl) | Call ($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 (1) | 92,000 | | | 1,000 | | | $ | 26 | | | $ | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Total | 92,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 26 | | | $ | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
(1) | During the third quarter 2014, the Company entered into a diesel crack spread collar, which is not designated as a hedge, which is the reverse position of the diesel crack spread collars expiring in the fourth quarter 2014 noted above. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following diesel crack spread collars related to diesel sales and crude oil purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Crack Spread Collars by Expiration Dates | Barrels Purchased and Sold | | BPD | | Average Bought | | Average Sold | | | | | | | | | | | | | | | | | | | | | | | | |
Put ($/Bbl) | Call ($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 90,000 | | | 1,000 | | | $ | 26 | | | $ | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 91,000 | | | 1,000 | | | 26 | | | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 92,000 | | | 1,000 | | | 26 | | | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 92,000 | | | 1,000 | | | 26 | | | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Total | 365,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 26 | | | $ | 35 | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
Jet Fuel Swap Contracts |
At September 30, 2014, the Company had the following derivatives related to jet fuel sales in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Jet Fuel Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 276,000 | | | 3,000 | | | $ | 115.65 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 957,500 | | | 2,623 | | | 114.25 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 1,233,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 114.56 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to jet fuel sales in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Jet Fuel Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 450,000 | | | 5,000 | | | $ | 117.5 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 273,000 | | | 3,000 | | | 116.68 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 276,000 | | | 3,000 | | | 116.18 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 276,000 | | | 3,000 | | | 115.65 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 775,000 | | | 2,123 | | | 114.05 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 2,050,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 115.66 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to jet fuel purchases in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Jet Fuel Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 90,000 | | | 1,000 | | | $ | 116.71 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 90,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 116.71 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gasoline Swap Contracts |
At September 30, 2014, the Company had the following derivatives related to gasoline sales in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gasoline Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 966,000 | | | 10,500 | | | $ | 108.07 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,091,000 | | | 2,989 | | | 112.83 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 2,057,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 110.59 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to gasoline sales in its fuel products segment, all of which are designated as cash flow hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gasoline Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 945,000 | | | 10,500 | | | $ | 104.39 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 955,500 | | | 10,500 | | | 109.68 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 966,000 | | | 10,500 | | | 106.6 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 460,000 | | | 5,000 | | | 104.85 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 3,326,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 106.61 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
At December 31, 2013, the Company had the following derivatives related to gasoline sales in its fuel products segment, none of which are designated as hedges. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gasoline Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
First Quarter 2014 | 630,000 | | | 7,000 | | | $ | 105.67 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Second Quarter 2014 | 409,500 | | | 4,500 | | | 110.48 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Third Quarter 2014 | 644,000 | | | 7,000 | | | 108.24 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 1,683,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 107.82 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Subsequent to September 30, 2014, the Company entered into the following crude oil, diesel, jet fuel and gasoline swap contracts that offset derivative instruments existing at September 30, 2014. |
Subsequent to September 30, 2014, the Company entered into the following derivatives related to crude oil sales in its fuel products segment, none of which are designated as hedges. As a result of this activity, the Company dedesignated the corresponding amount of crude oil swaps related to crude oil purchases for the corresponding periods. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Crude Oil Swap Contracts by Expiration Dates | Barrels Sold | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 1,913,000 | | | 20,793 | | | $ | 85.93 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,719,000 | | | 4,710 | | | 84.26 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 3,632,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 85.14 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Subsequent to September 30, 2014, the Company entered into the following derivatives related to diesel purchases in its fuel products segment, none of which are designated as hedges. As a result of this activity, the Company dedesignated the corresponding amount of diesel swaps related to diesel sales for the corresponding periods. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Diesel Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 1,242,000 | | | 13,500 | | | $ | 107.48 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 1,449,000 | | | 3,970 | | | 105.78 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 2,691,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 106.57 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Subsequent to September 30, 2014, the Company entered into the following derivatives related to jet fuel purchases in its fuel products segment, none of which are designated as hedges. As a result of this activity, the Company dedesignated the corresponding amount of jet fuel swaps related to jet fuel sales for the corresponding periods. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Jet Fuel Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 183,000 | | | 1,989 | | | $ | 100.78 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Calendar Year 2015 | 270,000 | | | 740 | | | 100.87 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 453,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 100.83 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Subsequent to September 30, 2014, the Company entered into the following derivatives related to gasoline purchases in its fuel products segment, none of which are designated as hedges. As a result of this activity, the Company dedesignated the corresponding amount of gasoline swaps related to gasoline sales for the corresponding periods. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Gasoline Swap Contracts by Expiration Dates | Barrels Purchased | | BPD | | Average Swap | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
($/Bbl) | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fourth Quarter 2014 | 488,000 | | | 5,304 | | | $ | 83.38 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total | 488,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average price | | | | | $ | 83.38 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |