Alon Refining Krotz Springs 10Q 2010 Q2 Quarterly report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q


þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2010


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

Commission file number: 333-163942

ALON REFINING KROTZ SPRINGS, INC.

(Exact name of Registrant as specified in its charter)


Delaware		74-2849682
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7616 LBJ Freeway, Suite 300, Dallas, Texas 75251
(Address of principal executive offices) (Zip Code)

(972) 367-3600
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesþ Noo

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yeso Noo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filero	Accelerated filero	Non-accelerated filerþ	Smaller reporting companyo
		(Do not check if a smaller reporting company)

Indicate by check whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yeso Noþ

The registrant is a subsidiary of Alon USA Energy, Inc., a Delaware corporation, and there is no market for the registrant’s common stock. As of July 31, 2010, 36,219 shares of the registrant’s Class A Common stock, par value $0.01, and 405 shares of the registrant’s Class B Common stock, par value $0.01, were outstanding.

The registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this form with the reduced disclosure format permitted by General Instruction H(2).


PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS			1
BALANCE SHEETS			1
STATEMENTS OF OPERATIONS			2
STATEMENTS OF CASH FLOWS			3
NOTES TO FINANCIAL STATEMENTS			4
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			15
FORWARD-LOOKING STATEMENTS			15
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			25
ITEM 4. CONTROLS AND PROCEDURES			26
PART II. OTHER INFORMATION
ITEM 5. EXHIBITS			27
SIGNATURES			28

EXHIBITS
EX-31.1 CERTIFICATION OF CEO PURSUANT TO SECTION 302
EX-31.2 CERTIFICATION OF CFO PURSUANT TO SECTION 302
EX-32.1 CERTIFICATION OF CEO AND CFO PURSUANT TO SECTION 906

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ALON REFINING KROTZ SPRINGS, INC.

BALANCE SHEETS
(in thousands except per share data)


	June 30,			December 31,
	2010			2009
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	26,161
Accounts receivable		8,599			8,344
Inventories		46,572			54,623
Prepaid expenses		900			615

Total current assets		56,071			89,743

Property, plant, and equipment, net		355,924			362,265
Other assets		33,098			30,829

Total assets	$	445,093		$	482,837


LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	169,903		$	92,682
Accrued liabilities		23,131			31,299
Short-term debt		30,000			—

Total current liabilities		223,034			123,981

Other non-current liabilities		8,328			7,873
Long-term debt		206,505			288,980

Total liabilities		437,867			420,834

Commitments and contingencies (Note 10)
Stockholders’ equity:
Class A Common stock, par value $0.01, 75,000 shares authorized; 36,219 shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively		—			—
Class B Common stock, par value $0.01, 1,000 shares authorized; 405 shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively		—			—
Additional paid-in capital		137,656			126,656
Accumulated other comprehensive loss, net of income tax		(3,710	)		(7,240	)
Retained deficit		(126,720	)		(57,413	)

Total stockholders’ equity		7,226			62,003

Total liabilities and equity	$	445,093		$	482,837

The accompanying notes are an integral part of these financial statements.

ALON REFINING KROTZ SPRINGS, INC.

STATEMENTS OF OPERATIONS
(unaudited, dollars in thousands)


	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2010			2009			2010			2009
Net sales	$	168,638		$	354,698		$	177,958		$	599,763
Operating costs and expenses:
Cost of sales		171,892			324,971			180,269			488,882
Direct operating expenses		15,372			21,525			25,908			43,869
Selling, general and administrative expenses		1,727			2,007			3,537			3,656
Depreciation and amortization		5,102			4,911			10,609			9,158

Total operating costs and expenses		194,093			353,414			220,323			545,565

Operating income (loss)		(25,455	)		1,284			(42,365	)		54,198
Interest expense		(10,240	)		(10,491	)		(26,956	)		(28,315	)
Other income, net		—			2			14			4

Income (loss) before income tax expense (benefit)		(35,695	)		(9,205	)		(69,307	)		25,887
Income tax expense (benefit)		—			(1,884	)		—			6,530

Net income (loss)	$	(35,695	)	$	(7,321	)	$	(69,307	)	$	19,357

The accompanying notes are an integral part of these financial statements.

ALON REFINING KROTZ SPRINGS, INC.

STATEMENTS OF CASH FLOWS
(unaudited, dollars in thousands)


	For the Six Months Ended
	June 30,
	2010			2009
Cash flows from operating activities:
Net income (loss)	$	(69,307	)	$	19,357
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Depreciation and amortization		10,609			9,158
Deferred income tax expense		—			7,065
Amortization of debt issuance costs		1,436			2,510
Amortization of original issuance discount		812			—
Write-off of unamortized debt issuance costs		6,659			—
Changes in operating assets and liabilities:
Accounts and other receivables, net		(255	)		9,158
Inventories		16,927			(18,375	)
Heating oil crack spread hedge		—			116,701
Prepaid expenses and other current assets		(285	)		20,626
Other assets		(2,662	)		10
Accounts payable		56,207			97,013
Accrued liabilities		(4,638	)		(20,760	)
Other non-current liabilities		4,830			18

Net cash provided by operating activities		20,333			242,481


Cash flows from investing activities:
Capital expenditures		(3,329	)		(3,087	)
Capital expenditures for turnarounds and catalysts		(2,194	)		(1,682	)
Earnout payment related to refinery acquisition		(4,375	)		—

Net cash used in investing activities		(9,898	)		(4,769	)


Cash flows from financing activities:
Deferred debt issuance costs		(642	)		(3,978	)
Cash received from inventory supply agreement		6,333			—
Revolving credit facilities, net		(83,287	)		(147,105	)
Additions to short-term debt		65,000			—
Payments on short-term debt		(35,000	)		—
Payments on long-term debt		—			(88,180	)
Proceeds from parent equity investment		11,000			25,000

Net cash used in financing activities		(36,596	)		(214,263	)


Net increase (decrease) in cash and cash equivalents		(26,161	)		23,449
Cash and cash equivalents, beginning of period		26,161			—

Cash and cash equivalents, end of period	$	—		$	23,449


Supplemental cash flow information:
Cash paid for interest	$	17,376		$	27,258

Financing activity — payments on long-term debt from deposit held to secure heating oil crack spread hedge	$	—		$	(50,000	)

The accompanying notes are an integral part of these financial statements.

ALON REFINING KROTZ SPRINGS, INC.

NOTES TO FINANCIAL STATEMENTS
(unaudited, dollars in thousands except as noted)

(1) Basis of Presentation and Certain Significant Accounting Policies

(a) Basis of Presentation

The financial statements include the accounts of Alon Refining Krotz Springs, Inc. (the “Company”). These financial statements of the Company are unaudited and have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of the Company’s management, the information included in these financial statements reflects all adjustments, consisting of normal and recurring adjustments, which are necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods presented. The results of operations for the interim periods are not necessarily indicative of the operating results that may be obtained for the year ending December 31, 2010.

The balance sheet as of December 31, 2009 has been derived from the audited financial statements as of that date. These unaudited financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2009.

(b) Revenue Recognition

Revenues from sales of refined products are earned and realized upon transfer of title to the customer based on the contractual terms of delivery (including payment terms and prices). Title primarily transfers at the refinery when the refined product is loaded into common carrier pipelines, trucks or railcars (free on board origin). In some situations, title transfers at the customer’s destination (free on board destination).

In the ordinary course of business, logistical and refinery production schedules necessitate the occasional sale of crude oil to third parties. All purchases and sales of crude oil are recorded net, in cost of sales in the statements of operations.

(c) New Accounting Standards

In February 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-09,Subsequent Event (Topic 855)which amends FASB Accounting Standards Codification (“ASC”) Topic 855,Subsequent Eventsso that SEC filers, as defined in the ASU, no longer are required to disclose the date through which subsequent events have been evaluated in originally issued and revised financial statements. ASU 2010-09 is effective immediately. ASU 2010-09 only affects disclosure requirements and will not have any effect on the Company’s financial statements.

In January 2010, the FASB issued ASU 2010-06,Improving Disclosures about Fair Valuewhich amends FASB ASC Topic 820,Fair Value Measurements and Disclosure, to require entities to make new disclosure about recurring and non-recurring fair-value measurements. The update requires new disclosures regarding significant transfers in and out of Level 1 and Level 2 fair-value measurements and information about purchases, sales, issuances, and settlements on a gross basis in the reconciliation of Level 3 fair-value adjustments. The update provides additional guidance on other fair value disclosures. This update is effective for interim and annual reporting periods beginning after December 15, 2009. ASU 2010-06 only affects disclosure requirements and will not have any effect on the Company’s financial statements.

(2) Operating Results and Liquidity

Due to the refinery operating margin environment, the Company accelerated the turnaround that was originally scheduled for the first quarter of 2010 to November 2009. Also, the Company extended the refinery downtime

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

beyond the turnaround due to further distressed refinery operating margins. As a result, the refinery had no throughput for 2010 until its restart in June 2010.

On March 15, 2010, the Company terminated its revolving credit facility and repaid all outstanding amounts thereunder. As a result of the prepayment of the revolving credit facility, a write-off of unamortized debt issuance costs of $6,659 was recorded as interest expense in the first quarter of 2010.

On March 15, 2010, the Company entered into a $65,000 short-term credit facility with Bank Hapoalim B.M. that, as currently amended and restated, matures on August 16, 2010. The Company has agreed in principal with Bank Hapoalim B.M. to extend the maturity date to November 15, 2010. The Company originally borrowed $65,000 and has repaid $35,000 as of June 30, 2010.

Future operating results will depend on market factors, primarily the difference between the prices the Company receives from customers for produced products compared to the prices the Company pays to suppliers for crude oil. The Company’s management believes its current plans will result in continued operation of the refinery and realization of net asset values related to its operations.

(3) Supply and Offtake Agreement

Supply and Offtake Agreement with J. Aron & Company

On April 21, 2010, the Company entered into a Supply and Offtake Agreement, which was amended on May 26, 2010, (the “Supply and Offtake Agreement”) with J. Aron & Company (“J. Aron”), the proceeds of which allowed the Company to retire part of its obligations under the Term Facility, as defined below, and support the operation of the refinery at a minimum of 72,000 barrels per day. Pursuant to the Supply and Offtake Agreement, (i) J. Aron agreed to sell to the Company, and the Company agreed to buy from J. Aron, at market price, crude oil for processing at the Krotz Springs refinery owned and operated by the Company and (ii) the Company agreed to sell, and J. Aron agreed to buy, at market price, certain refined products produced at the Krotz Springs refinery.

In connection with the execution of the Supply and Offtake Agreement, the Company also entered into agreements that provided for the sale, at market price, of the Company’s crude oil and certain refined product inventories to J. Aron, the lease to J. Aron of crude oil and refined product storage tanks located at the Krotz Springs refinery, and an agreement to identify prospective purchasers of refined products on J. Aron’s behalf. The Supply and Offtake Agreement has an initial term that expires on May 31, 2012 and automatically renews for up to two additional 12-month terms unless either party provides notice of termination at least six months prior to the end of the then-current term. Following expiration or termination of the Supply and Offtake Agreement, the Company is obligated to purchase the crude oil and refined product inventories then owned by J. Aron and located at the Krotz Springs refinery.

The Supply and Offtake Agreement includes customary events of default and restrictions on the activities of the Company.

Standby LC Facility

On May 28, 2010, the Company entered into a secured Credit Agreement (the “Standby LC Facility”) by and between the Company, as Borrower, and Goldman Sachs Bank USA, as Issuing Bank. The Standby LC Facility provides for letters of credit to be issued to J. Aron in an aggregate amount of up to $200,000 and at this time there is no further availability under the Standby LC Facility. Obligations under the Standby LC Facility are secured by a first priority lien on the existing and future accounts receivable and inventory of the Company.

The Standby LC Facility includes customary events of default and restrictions on the activities of the Company. The Standby LC Facility contains no maintenance financial covenants.

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

(4) Fair Value and Derivative Instruments

(a) Fair Value of Financial Instruments

The carrying amounts of the Company’s cash and cash equivalents, receivables, payables and accrued liabilities approximate fair value due to the short-term maturities of these assets and liabilities. The reported amounts of short-term and long-term debt approximate fair value. Derivative financial instruments are carried at fair value, which is based on quoted market prices.

The Company must determine fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As required, the Company utilizes valuation techniques that maximize the use of observable inputs (levels 1 and 2) and minimize the use of unobservable inputs (level 3) within the fair value hierarchy. The Company generally applies the “market approach” to determine fair value. This method uses pricing and other information generated by market transactions for identical or comparable assets and liabilities. Assets and liabilities are classified within the fair value hierarchy based on the lowest level (least observable) input that is significant to the measurement in its entirety.

The following table sets forth the assets and liabilities measured at fair value on a recurring basis, by input level, in the balance sheets at June 30, 2010 and December 31, 2009, respectively:


	Quoted Prices
	in
	Active Markets		Significant
	for Identical		Other		Significant
	Assets or		Observable		Unobservable
	Liabilities		Inputs		Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
As of June 30, 2010
Assets:
Commodity contracts (distillate forwards)	$	881	$	—	$	—	$	881
Liabilities:
Commodity swaps		—		404		—		404
Commodity calls		—		6,706		—		6,706

As of December 31, 2009
Assets:
Commodity contracts (heating oil swaps)	$	—	$	89	$	—	$	89
Liabilities:
Commodity contracts (crude swaps)		—		9,983		—		9,983

(b) Derivative Financial Instruments

Commodity Derivatives – Mark to Market

The Company selectively utilizes commodity derivatives to manage its exposure to commodity price fluctuations and uses crude oil and refined product commodity derivative contracts to reduce risk associated with potential price changes on committed obligations. The Company does not speculate using derivative instruments. There is not a significant credit risk on the Company’s derivative instruments which are transacted through counterparties meeting established collateral and credit criteria.

The Company has elected not to designate the following commodity derivatives as cash flow hedges for financial accounting purposes. Therefore, changes in the fair value of the commodity derivatives are included in income in the period of the change.

At June 30, 2010, the Company held forward contracts for net sales of 250,035 barrels of diesel at an average

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

price of $85.44 per barrel. The contracts are recorded at their fair market values and an unrealized gain of $881 has been included in cost of sales in the statements of operations for the three months ended June 30, 2010.

At June 30, 2010, the Company held futures contracts for sales of 292,400 barrels of heating oil crack spread swaps at an average of $11.84 per barrel. The contracts are recorded at their fair market values and an unrealized loss of $404 has been included in cost of sales in the statements of operations for the three months ended June 30, 2010.

At June 30, 2010, the Company had written call contracts outstanding for the net purchase of 3,514,500 barrels of crude and sale of 3,514,500 barrels of heating oil at an average strike price of $11.35 for a period of 21 months commencing October 2010. The fair value of the obligation in excess of the premium received resulted in a loss of $60 included in cost of sales in the statements of operations for the three months ended June 30, 2010.

At June 30, 2009, the Company held net forward contracts for sales of 225,000 barrels of refined products at an average price of $75.56 per barrel. The contracts are recorded at their fair market values and an unrealized loss of $260 has been included in cost of sales in the statements of operations for the three months ended June 30, 2009.

At June 30, 2009, the Company held net futures contracts for sales of 72,000 barrels of refined products at an average price of $79.41 per barrel. The contracts were recorded at their fair market values and an unrealized gain of $28 has been included in cost of sales in the statements of operations for the three months ended June 30, 2009.

At June 30, 2009, the Company held futures contracts for 434,000 barrels of crude swaps at an average of $74.80 per barrel. The contracts are recorded at fair market values and an unrealized loss of $15,157 has been included in cost of sales in the statement of operations for the three months ended June 30, 2009.

Commodity Derivatives – Cash Flow Hedges

To designate a derivative as a cash flow hedge, the Company documents at the inception of the hedge the assessment that the derivative will be highly effective in offsetting expected changes in cash flows from the item hedged. This assessment, which is updated at least quarterly, is generally based on the most recent relevant historical correlation between the derivative and the item hedged. If, during the term of the derivative, the hedge is determined to be no longer highly effective, hedge accounting is prospectively discontinued and any remaining unrealized gains or losses, based on the effective portion of the derivative at that date, are reclassified to earnings when the underlying transaction occurs.

Contemporaneously with the acquisition of the refinery, the Company entered into futures contracts for the forward purchase of crude oil and the forward sale of distillates of 14,849,750 barrels. These futures contracts were designated as cash flow hedges for accounting purposes. Gains and losses for the futures contracts designated as cash flow hedges reported in accumulated other comprehensive income in the balance sheet are reclassified into cost of sales when the forecasted transactions affect income. In the fourth quarter of 2008, the Company determined during its retrospective assessment of hedge effectiveness that the hedge was no longer highly effective. Cash flow hedge accounting was discontinued in the fourth quarter of 2008 and all changes in value subsequent to the discontinuance were recognized into earnings. In April 2009, the Company completed an unwind of these futures contracts for $139,296.

No component of the derivative instruments’ gains or losses was excluded from the assessment of hedge effectiveness.

Losses of $2,932 and $3,530 for the three and six months ended June 30, 2010, and gains of $3,068 and $4,014 for the three and six months ended June 30, 2009, have been reclassified from accumulated other comprehensive income to earnings since the discontinuance of cash flow hedge accounting, respectively. All remaining adjustments from accumulated comprehensive income to cost of sales will occur either over the four month period beginning

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

July 1, 2010, or earlier if it is determined that the forecasted transactions are not likely to occur. No component of the derivative instruments’ gains or losses was excluded from the assessment of hedge effectiveness.

The following table presents the effect of derivative instruments on the statements of financial position.


	As of June 30, 2010
	Asset Derivatives			Liability Derivatives
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivatives not designated as hedging instruments:
Commodity contracts (futures, forwards, calls and swaps)	Accounts receivable	$	—	Accrued liabilities	$	(1,417	)
Commodity contracts (futures, forwards, calls and swaps)			—	Other non-current liabilities		(4,812	)

Total derivatives not designated as hedging instruments		$	—		$	(6,229	)


	As of December 31, 2009
	Asset Derivatives			Liability Derivatives
	Balance Sheet			Balance Sheet
	Location	Fair Value		Location	Fair Value
Derivatives not designated as hedging instruments:
Commodity contracts (futures, forwards and SPR swaps)	Accounts receivable	$	89	Accrued liabilities	$	(9,983	)

Total derivatives not designated as hedging instruments.		$	89		$	(9,983	)

The following tables present the effect of derivative instruments on the Company’s statements of operations and accumulated other comprehensive income (“OCI”).


								Gain (Loss) Reclassified
								from Accumulated OCI into
								Income (Ineffective
			Gain (Loss) Reclassified from					Portion and Amount
			Accumulated OCI into Income					Excluded from
Cash Flow Hedging	Gain (Loss)			(Effective Portion)				Effectiveness Testing)
Relationships	Recognized in OCI		Location		Amount			Location	Amount
For the Three Months Ended June 30, 2010
Commodity swaps (heating oil swaps)	$	—	Cost of sales		$	(2,932	)		$	—

Total derivatives	$	—			$	(2,932	)		$	—


For the Six months Ended June 30, 2010
Commodity swaps (heating oil swaps)	$	—	Cost of sales		$	(3,530	)		$	—

Total derivatives	$	—			$	(3,530	)		$	—

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)


						Gain (Loss) Reclassified
						from Accumulated OCI into
						Income (Ineffective
			Gain (Loss) Reclassified from			Portion and Amount
			Accumulated OCI into Income			Excluded from
Cash Flow Hedging	Gain (Loss)		(Effective Portion)			Effectiveness Testing)
Relationships	Recognized in OCI		Location	Amount		Location	Amount
For the Three Months Ended June 30, 2009
Commodity swaps (heating oil swaps)	$	—	Cost of sales	$	778		$	—

Total derivatives	$	—		$	778		$	—


For the Six months Ended June 30, 2009
Commodity swaps (heating oil swaps)	$	—	Cost of sales	$	4,014		$	—

Total derivatives	$	—		$	4,014		$	—


	Gain (Loss) Recognized in Income
	Location	Amount
Derivatives not designated as hedging instruments:
For the Three Months Ended June 30, 2010
Commodity contracts (futures & forwards)	Cost of sales	$	687
Commodity contracts (heating oil swaps)	Cost of sales		(209	)
Commodity contracts (call options)	Cost of sales		(60	)

Total derivatives		$	418


For the Six months Ended June 30, 2010
Commodity contracts (futures & forwards)	Cost of sales	$	557
Commodity contracts (heating oil swaps)	Cost of sales		(315	)
Commodity contracts (heating oil calls)	Cost of sales		(60	)

Total derivatives		$	182


	Gain (Loss) Recognized in Income
	Location	Amount
Derivatives not designated as hedging instruments:
For the Three Months Ended June 30, 2009
Commodity contracts (futures & forwards)	Cost of sales	$	(6,828	)
Commodity contracts (heating oil swaps)	Cost of sales		470
Commodity contracts (crude swaps)	Cost of sales		1,073

Total derivatives		$	(5,285	)


For the Six months Ended June 30, 2009
Commodity contracts (futures & forwards)	Cost of sales	$	(4,725	)
Commodity contracts (heating oil swaps)	Cost of sales		41,182
Commodity contracts (crude swaps)	Cost of sales		174

Total derivatives		$	36,631

(5) Inventories

The Company’s inventories are stated at the lower of cost or market and are comprised primarily of crude oil, refined products and blendstocks. Cost is determined under the LIFO method for crude oil, refined products and blendstocks. Materials and supplies are stated at average cost.

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

Market values of crude oil, refined products and blendstock inventories exceeded LIFO costs by $20,133 and $20,499 at June 30, 2010 and December 31, 2009, respectively.

The Company’s inventories include $41,538 and $22,558 of inventory consigned to others at June 30, 2010 and December 31, 2009, respectively.

(6) Property, Plant and Equipment, net

Property, plant and equipment consisted of the following:


	June 30,			December 31,
	2010			2009
Refining facilities	$	392,770		$	389,441
Less accumulated depreciation		(36,846	)		(27,176	)

Property, plant and equipment, net	$	355,924		$	362,265

The useful lives of refining facilities used to determine depreciation expense were 3 – 20 years with an average life of 18 years.

(7) Additional Financial Information

The tables that follow provide additional financial information related to the financial statements.

(a) Other assets


	June 30,		December 31,
	2010		2009
Deferred turnaround and chemical catalyst cost, net	$	12,836	$	11,540
Deferred debt issuance costs		9,665		17,118
Intangible assets		2,134		2,171
Security deposit		8,463		—

Total other assets	$	33,098	$	30,829

Unamortized debt issuance costs of $6,659 related to the prepayment of the Company’s revolving credit facility were written off the first quarter of 2010.

(b) Accrued Liabilities and Other Non-Current Liabilities


	June 30,		December 31,
	2010		2009
Accrued Liabilities:
Commodity swaps	$	1,417	$	9,983
Valero earnout liability		8,750		8,750
Accrued interest		9,158		8,137
Other		3,806		4,429

Total accrued liabilities	$	23,131	$	31,299


Other Non-Current Liabilities:
Environmental accrual	$	399	$	412
Asset retirement obligations		929		899
Valero earnout liability		2,188		6,562
Commodity swaps		4,812		—

Total other non-current liabilities	$	8,328	$	7,873

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

(c) Comprehensive Income

The following table displays the computation of total comprehensive income:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2010			2009			2010			2009
Net income (loss)	$	(35,695	)	$	(7,321	)	$	(69,307	)	$	19,357
Other comprehensive gain (loss), net of tax:
Unrealized gain (loss) on cash flow hedges, net of tax		2,932			(443	)		3,530			(1,804	)

Total other comprehensive income (loss), net of tax		2,932			(443	)		3,530			(1,804	)

Comprehensive income (loss)	$	(32,763	)	$	(7,764	)	$	(65,777)		$	17,553

The following table displays the components of accumulated other comprehensive loss, net of tax.


	June 30,			December 31,
	2010			2009
Unrealized losses on cash flow hedges, net of tax	$	(3,710	)	$	(7,240	)

Accumulated other comprehensive loss, net of tax	$	(3,710	)	$	(7,240	)

(8) Indebtedness

Debt consisted of the following:


	June 30,		December 31,
	2010		2009
Short-term debt	$	30,000	$	—

Revolving credit facility	$	—	$	83,287
Senior secured notes, net of discount		206,505		205,693

Total long-term debt	$	206,505	$	288,980

Senior Secured Notes.In October 2009, the Company issued $216,500 in aggregate principal amount of 13.50% senior secured notes (the “Senior Secured Notes”) in a private offering. The Senior Secured Notes were issued at an offering price of 94.857%. The Senior Secured Notes will mature on October 15, 2014 and the entire principal amount is due at maturity. Interest is payable semi-annually in arrears on April 15 and October 15.

The Company received gross proceeds of $205,365 from the sale of the Senior Secured Notes (before fees and expenses related to the offering). In connection with the closing, the Company prepaid in full all outstanding obligations under the Company’s term loan. The remaining proceeds from the offering were used for general corporate purposes.

The terms of the Senior Secured Notes are governed by an indenture (the “Indenture”) and the obligations under the Indenture are secured by a first priority lien on the Company’s property, plant and equipment and a second priority lien on the Company’s cash, accounts receivable and inventory.

The Indenture also contains restrictive covenants such as restrictions on loans, mergers, sales of assets, additional indebtedness and restricted payments. The Indenture does not contain any maintenance financial covenants.

On February 17, 2010, the Company exchanged $216,480 of Senior Secured Notes for an equivalent amount of Senior Secured Notes (“Exchange Notes”) registered under the Securities Act of 1933. The Exchange Notes are substantially identical to the Senior Secured Notes, except that the Exchange Notes have been registered with the

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

Securities and Exchange Commission and are not subject to transfer restrictions.

At June 30, 2010, and December 31, 2009, the Senior Secured Notes had an outstanding balance (net of unamortized discount) of $206,505 and $205,693, respectively. The Company is utilizing the effective interest method to amortize the original issue discount over the life of the Senior Secured Notes.

Short-Term Credit Facility.On March 15, 2010, the Company entered into a $65,000 short-term credit facility with Bank Hapoalim B.M. (the “Term Facility”). The Term Facility as currently amended and restated matures on August 16, 2010. The Company has agreed in principal with Bank Hapoalim B.M. to extend the maturity date to November 15, 2010. The Company originally borrowed $65,000 and has repaid $35,000 as of June 30, 2010.

Borrowings under the Term Facility bear interest at LIBOR plus 3.00% and $30,000 was outstanding under the Term Facility at June 30, 2010.

The Term Facility is secured by a second lien on all assets other than cash, accounts receivable, and inventory owned by the Company.

The Term Facility contains customary restrictive covenants, such as restrictions on liens, mergers, consolidation, sales of assets, capital expenditures, additional indebtedness, investments, hedging transactions, and certain restricted payments.

Revolving Credit Facility.On March 15, 2010, the Company terminated its revolving credit facility and repaid all outstanding amounts thereunder. As a result of the prepayment of the revolving credit facility, the Company recorded a write-off of unamortized debt issuance costs of $6,659 as interest expense in the first quarter of 2010.

Borrowings of $83,287 and outstanding letters of credit of $2,765 were outstanding under the revolving credit facility at December 31, 2009.

(9) Related-Party Transactions

A portion of the purchase price for the acquisition of the Company’s refinery from Valero was provided through an $80,000 equity investment contributed to the Company by Alon Israel Oil Company, Ltd. (“Alon Israel”), the majority stockholder of Alon USA, together with a $21,656 equity investment by Alon USA and its affiliates. Also in connection with the acquisition, Alon Israel, together with Alon USA and its affiliates, arranged for the issuance of $66,000 of standby letters of credit, without recourse to the Company, to support increased borrowing capacity under the Company’s revolving credit facility.

In connection with amendments to the Company’s credit facilities in April 2009, Alon Israel, together with Alon USA and its affiliates, invested an additional $25,000 of equity in the Company, and arranged for the issuance of an additional $25,000 of standby letters of credit without recourse to the Company. In connection with the termination of the revolving credit facility, the Company returned to Alon Israel $65,000 of letters of credit. Also in connection with the termination of the revolving credit facility, $11,000 of the standby letters of credit support was converted into cash support. In the second quarter of 2010, this cash support was converted into an equity contribution of the Company. These contributions, together with the equity and letters of credit support resulted in $137,656 of equity and $15,000 of letters of credit support provided to the Company from Alon Israel and Alon USA and its affiliates at June 30, 2010.

The Company is a subsidiary of Alon USA and is operated as a component of the integrated operations of Alon USA and its other subsidiaries. As such, the executive officers of Alon USA, who are employed by another subsidiary of Alon USA, also serve as executive officers of the Company and Alon USA’s other subsidiaries and Alon USA performs general corporate and administrative services and functions for the Company and Alon USA’s other subsidiaries, which include accounting, treasury, cash management, tax, information technology, insurance administration and claims processing, legal, environmental, risk management, audit, payroll and employee benefit processing, and internal audit services. Alon USA allocates the expenses actually incurred by it in performing these services to the Company and to its other subsidiaries based primarily on the amount of time the individuals performing such services devote to the Company’s business and affairs relative to the amount of time they devote to the business and affairs of Alon USA’s other subsidiaries. The Company records the amount of such allocations to

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

its financial statements as selling, general and administrative expenses. For the three and six months ended June 30, 2010 the Company recorded selling, general and administrative expenses of $1,727 and $3,537, respectively, with respect to allocations from Alon USA for such services.

Alon USA currently owns all of the Company’s outstanding voting capital stock. As a result, Alon USA can control the election of the Company’s directors, exercise control or significant influence over the Company’s corporate and management policies and generally determine the outcome of any corporate transaction or other matter submitted to the Company’s stockholders for approval, including potential mergers or acquisitions, asset sales and other significant corporate transactions. So long as Alon USA continues to own a majority of the outstanding shares of the Company’s voting capital stock, Alon USA will continue to be able to effectively control or influence the outcome of such matters.

(10) Commitments and Contingencies

(a) Commitments

In the normal course of business, the Company has long-term commitments to purchase utilities such as natural gas, electricity and water for use by the refinery. The Company is also party to various refined product and crude oil supply and exchange agreements. These agreements are short-term in nature or provide terms for cancellation.

Offtake Agreement with Valero

In connection with the acquisition of the Company’s refinery, the Company and Valero Energy Corporation (“Valero”) entered into an offtake agreement for five years that provides for Valero to purchase, at market prices, light cycle oil and straight run diesel.

Earnout Settlement with Valero

In connection with the Company’s refinery acquisition, in July 2008 the Company and Valero entered into an earnout agreement which was amended in August 2009. The Company has paid Valero approximately $19,688 in 2009 and $4,374 in the first six months of 2010. Additionally, the Company has agreed to pay Valero an additional sum of $10,937 in five installments of approximately $2,188 per quarter through the third quarter of 2011 which will result in aggregate earnout payments of $35,000. Of the $10,937 that remains to be paid, $8,750 is included in accrued liabilities and $2,188 is included in other non-current liabilities on the balance sheet at June 30, 2010.

(b) Environmental

The Company is subject to federal, state, and local environmental laws and regulations. These rules regulate the discharge of materials into the environment and may require the Company to incur future obligations to investigate the effects of the release or disposal of certain petroleum, chemical, and mineral substances at various sites; to remediate or restore these sites; to compensate others for damage to property and natural resources and for remediation and restoration costs. These possible obligations relate to sites owned by the Company and associated with past or present operations. The Company is currently participating in environmental investigations, assessments and cleanups under these regulations at its refinery. The Company may in the future be involved in additional environmental investigations, assessments and cleanups. The magnitude of future costs will depend on factors such as the unknown nature and contamination at many sites, the timing, extent and method of the remedial actions which may be required, and the determination of the Company’s liability in proportion to other responsible parties.

Environmental expenditures are expensed or capitalized depending on their future economic benefit. Expenditures that relate to an existing condition caused by past operations and that have no future economic benefit are expensed. Liabilities for expenditures of a non-capital nature are recorded when environmental assessment and/or remediation is probable, and the costs can be reasonably estimated. Substantially all amounts accrued are expected to be paid out over the next five years. The level of future expenditures for environmental remediation obligations beyond the next five years cannot be determined with any degree of reliability.

ALON REFINING KROTZ SPRINGS, INC.
NOTES TO FINANCIAL STATEMENTS — (Continued)
(unaudited, dollars in thousands except as noted)

The Company has accrued a non-current liability for environmental remediation obligations of $399 and $412 at June 30, 2010 and at December 31, 2009, respectively.


ITEM 2.		MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2009. In this document, the words “the Company,” “we” and “our” refer to Alon Refining Krotz Springs, Inc.

Forward-Looking Statements

Certain statements contained in this report and other materials we file with the SEC, or in other written or oral statements made by us, other than statements of historical fact, are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements relate to matters such as our industry, business strategy, goals and expectations concerning our market position, future operations, margins, profitability, capital expenditures, liquidity and capital resources and other financial and operating information. We have used the words “anticipate,” “assume,” “believe,” “budget,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “will,” “future” and similar terms and phrases to identify forward-looking statements.

Forward-looking statements reflect our current expectations regarding future events, results or outcomes. These expectations may or may not be realized. Some of these expectations may be based upon assumptions or judgments that prove to be incorrect. In addition, our business and operations involve numerous risks and uncertainties, many of which are beyond our control, which could result in our expectations not being realized or otherwise materially affect our financial condition, results of operations and cash flows.

Actual events, results and outcomes may differ materially from our expectations due to a variety of factors. Although it is not possible to identify all of these factors, they include, among others, the following:

	•		changes in general economic conditions and capital markets;

	•		changes in the underlying demand for our products;

	•		the availability, costs and price volatility of crude oil, other refinery feedstocks and refined products;

	•		changes in the spread between West Texas Intermediate crude oil and Light Louisiana Sweet crude Oil;

	•		the effects of transactions involving forward contracts and derivative instruments;

	•		actions of customers and competitors;

	•		changes in fuel and utility costs incurred by our refinery;

	•		disruptions due to equipment interruption, pipeline disruptions or failure at third-party facilities;

	•		the execution of planned capital projects;

	•		adverse changes in the credit ratings assigned to our trade credit and debt instrument;

	•		the effects of and cost of compliance with current and future state and federal environmental, economic, safety and other laws, policies and regulations;

	•		operating hazards, natural disasters, casualty losses and other matters beyond our control;

	•		the global financial crisis’ impact on our business and financial condition; and

•

the other factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2009 under the caption “Risk Factors.”

Any one of these factors or a combination of these factors could materially affect our future results of operations and could influence whether any forward-looking statements ultimately prove to be accurate. Our forward-looking statements are not guarantees of future performance, and actual results and future performance may differ materially from those suggested in any forward looking statements. We do not intend to update these statements unless we are required by the securities laws to do so.

Refinery Overview

We own and operate a high conversion crude oil refinery with a crude oil throughput capacity of approximately 83,100 barrels per day (“bpd”). Placed into service in 1980, our refinery is the second newest complex, grassroots refinery built in the United States. Our refinery is strategically located on the Atchafalaya River in central Louisiana at the intersection of two crude oil pipeline systems and has direct access to the Colonial Pipeline, providing us with diversified access to both locally sourced and foreign crude oils, as well as distribution of our products to markets throughout the Southern and Eastern United States and along the Mississippi and Ohio Rivers.

Our refinery has the capability to process substantial volumes of low-sulfur, or sweet, crude oils to produce a high percentage of light, high-value refined products. Sweet crude oil typically comprises 100% of our refinery’s crude oil input.

Our refinery’s Residual Fluid Catalytic Cracking Unit (“FCC”) allows us to produce a high percentage of light products with fewer processing units and lower maintenance costs compared to refineries utilizing conventional FCC technologies. Our refinery’s liquid product yield is approximately 101.5%, meaning that for each 100 barrels of crude oil and feedstocks input into our refinery, we typically produce 101.5 barrels of refined products. Of the 101.5%, on average 99.0% is light finished products such as gasoline and distillates, including diesel and jet fuel, petrochemical feedstocks and LPG, and the remaining 2.5% is primarily heavy oils.

Refinery History

In 1980, Hill Petroleum completed the initial construction of our refinery and commenced operations with a crude unit, vacuum unit and reformer. Our refinery subsequently went through several upgrades, including the addition of an FCC in 1982, a 3,300 bpd polymerization unit in 1986, and a 4,500 bpd isomerization unit in 1992. Valero acquired our refinery in 1997, upgraded the FCC to a 34,100 bpd Residual FCC in 2002 and installed a 18,000 bpd gasoline desulfurization unit (“GDU”) in 2006.

Effective July 1, 2008, Alon USA completed the acquisition of our refinery and related assets through the acquisition of all of the capital stock of Valero Refining Company — Louisiana from Valero. The purchase price was $333.0 million in cash plus $141.5 million for working capital, including inventories, as well as future consideration in the form of earnout payments due from us based on the average market prices for crude oil, regular unleaded gasoline, and ultra low-sulfur diesel in each of the three twelve month periods following the acquisition. In August 2009, we amended the earnout agreement with Valero to replace future earnout payments with fixed future payments. As a result, we paid Valero approximately $24.1 million through June 30, 2010 and have agreed to pay Valero an additional sum of $10.9 million in five installments of approximately $2.2 million per quarter through the third quarter of 2011 for earnout payments in an aggregate amount of $35.0 million.

Major Influences on Results of Operations

Our earnings and cash flows are primarily affected by the difference between refined product prices and the prices for crude oil and other feedstocks. The cost to acquire crude oil and other feedstocks and the price of the refined products we ultimately sell depends on numerous factors beyond our control, including the supply of, and demand for, crude oil, gasoline and other refined products which, in turn, depends on, among other factors, changes in domestic and foreign economies, weather conditions, domestic and foreign political affairs, production levels, the availability of imports, the marketing of competitive fuels and government regulation. While our sales and operating revenues fluctuate significantly with movements in crude oil and refined product prices, it is the spread between crude oil and refined product prices, and not necessarily fluctuations in those prices, which affects our earnings.

In order to measure our operating performance, we compare our per barrel refinery operating margins to certain industry benchmarks. We compare our refinery’s per barrel operating margin to the Gulf Coast 2/1/1 crack spread. The Gulf Coast 2/1/1 crack spread is calculated assuming that two barrels of a benchmark crude oil are converted, or cracked, into one barrel of gasoline and one barrel of diesel. We calculate the Gulf Coast 2/1/1 crack spread using the market values of Gulf Coast unleaded gasoline and Gulf Coast high sulfur diesel and the market value of WTI crude oil.

Our results of operations are also significantly affected by our refinery’s operating costs, particularly the cost of natural gas used for fuel and the cost of electricity. Natural gas prices have historically been volatile. For example, between January 1, 2008 and December 31, 2009, natural gas prices ranged between $2.51 and $13.58 per million British thermal units. Typically, electricity prices fluctuate with natural gas prices.

Factors Affecting Comparability

Factors which are fundamental to understanding comparisons of our period-to-period financial performance for both historical and future periods include those discussed below.

Throughput

Safety, reliability and the environmental performance of our refinery is critical to our financial performance. The financial impact of planned downtime, such as a turnaround or major maintenance project, is mitigated through a diligent planning process that considers product availability, margin environment and the availability of resources to perform the required maintenance. Our refinery was shutdown during November of 2009 for a scheduled turnaround and remained down as the work was completed and restarted in June of 2010.

Revolving Credit Facility and Term Credit Facility

On March 15, 2010, we terminated our revolving credit facility and repaid all outstanding amounts thereunder. As a result of the prepayment of the revolving credit facility, a write-off of unamortized debt issuance costs of $6.7 million was recorded as interest expense in the first quarter of 2010.

On March 15, 2010, we entered into a new $65.0 million term credit facility with Bank Hapoalim B.M. with a maturity date of August 16, 2010. We borrowed $65.0 million and used approximately $51.0 million to repay the outstanding amounts under the revolving credit facility that was terminated.

Senior Secured Notes

In October 2009, we issued $216.5 million in aggregate principal amount of 13.50% senior secured notes in a private offering. We received gross proceeds of $205.4 million from the sale of the senior secured notes (before fees and expenses related to the offering). In connection with the closing, we prepaid in full the outstanding principal balance of our term loan of $163.8 million.

2008 Hedging Agreement

Contemporaneously with the acquisition of our refinery, we entered into a heating oil crack spread hedging agreement (the “2008 Hedging Agreement”) consisting of futures contracts for the forward purchase of crude oil and the forward sale of heating oil covering 14,849,750 barrels over a 27 month period. As of December 31, 2008, the mark-to-market value of the heating oil crack spread hedge was $116.7 million and was recorded as a reduction to cost of sales. In April 2009, the 2008 Hedging Agreement was terminated at a value of $139.3 million for which we received proceeds of $133.6 million and recorded a charge to interest expense of $5.7 million. In connection with the termination of the 2008 Hedging Agreement, we also received $50.0 million from the release of cash collateral previously pledged by us to support obligations under the 2008 Hedging Agreement.

Results of Operations


	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2010			2009			2010			2009
Statement of Operations Data:
Net sales	$	168,638		$	354,698		$	177,958		$	599,763
Cost of sales		171,892			324,971			180,269			488,882
Direct operating expenses		15,372			21,525			25,908			43,869
Selling, general and administrative expenses		1,727			2,007			3,537			3,656
Depreciation and amortization expenses		5,102			4,911			10,609			9,158

Operating income (loss)		(25,455	)		1,284			(42,365	)		54,198
Other income, net		—			2			14			4
Interest expense		(10,240	)		(10,491	)		(26,956	)		(28,315	)

Income (loss) before income tax expense (benefit)		(35,695	)		(9,205	)		(69,307	)		25,887
Income tax expense (benefit)		—			(1,884	)		—			6,530

Net income (loss)	$	(35,695	)	$	(7,321	)	$	(69,307	)	$	19,357

Operating Data:
Refinery Throughput (bpd):
Light sweet crude		10,358			28,065			5,208			27,746
Heavy sweet crude		10,693			26,362			5,376			23,240
Blendstocks		909			4,031			457			5,113

Total refinery throughput (1)		21,960			58,458			11,041			56,099

Refinery Production (bpd):
Gasoline		8,427			27,962			4,237			26,215
Diesel/Jet		9,098			24,514			4,575			24,491
Heavy oils		2,809			1,358			1,412			1,124
Others		1,485			5,521			746			5,205

Total refinery production (2)		21,819			59,355			10,970			57,035

Key Operating Statistics:
Refinery utilization (3)		25.3	%		65.5	%		12.7	%		61.4	%
Per barrel of throughput:
Refinery operating margin (4)	$	(1.95	)	$	5.85		$	(1.48	)	$	8.91
Refinery direct operating expense (5)		7.69			4.04			12.96			4.32
Capital expenditures		1,466			2,326			3,329			3,087
Capital expenditures for turnaround and catalyst		273			1,120			2,194			1,682
Pricing Statistics:
WTI crude oil (per barrel)	$	77.74		$	59.54		$	78.24		$	51.36
2/1/1 Gulf Coast high sulfur diesel crack spread (per barrel)		8.92			6.63			7.59			8.04
Product price (dollars per gallon):
Gulf Coast unleaded gasoline	$	2.053		$	1.638		$	2.046		$	1.429
Gulf Coast high sulfur diesel		2.074			1.513			2.041			1.400
Natural gas (per mmbtu)	$	4.35		$	3.81		$	4.66		$	4.13


(1)		Total refinery throughput represents the total barrels per day of crude oil and blendstock inputs in the refinery production process.

(2)		Total refinery production represents the barrels per day of various products produced from processing crude oil and other feedstocks through the crude unit and other conversion units at our refinery.

(3)		Refinery utilization represents average daily crude oil throughput divided by crude oil capacity, excluding planned periods of downtime for maintenance and turnarounds. Refinery throughput and production for the three and six months ended June 30, 2010 reflect one month of operations as the Company commenced operations in June 2010 following completion of a major turnaround. Refinery throughput and production for


		2009 reflects the effects of our optimization of throughput to respond to declining margins and to reduce borrowings under our Revolving Credit Facility prior to amendments to our credit facilities in April 2009.

(4)		Refinery operating margin is a per barrel measurement calculated by dividing the margin between net sales and cost of sales (exclusive of substantial unrealized hedging gains and losses) attributable to our refinery by its throughput volumes. Industry-wide refining results are driven and measured by the margins between refined product prices and the prices for crude oil, which are referred to as crack spreads. We compare our refinery operating margins to these crack spreads to assess our operating performance relative to other participants in our industry. There were unrealized hedging gains of $2,373 and $20,399 for our refinery for the three and six months ended June 30, 2009, respectively. Additionally, realized gains related to the unwind of the 2008 Hedging Agreement of $133,581 were excluded from our refinery margin for the three and six months ended June 30, 2009.

(5)		Refinery direct operating expense is a per barrel measurement calculated by dividing direct operating expenses, exclusive of depreciation and amortization, by the total throughput volumes.

Three months ended June 30, 2010 compared to three months ended June 30, 2009

Net Sales.Net sales for the three months ended June 30, 2010 decreased by $186.1 million, or 52.5%, to $168.6 million from $354.7 million for the three months ended June 30, 2009. The decrease in net sales was due to the refinery shutdown until its restart in June 2010.

Cost of Sales.Cost of sales for the three months ended June 30, 2010 decreased by $153.1 million, or 47.1%, to $171.9 million from $325.0 million for the three months ended June 30, 2009. The decrease in cost of sales was due to the refinery shutdown until its restart in June 2010.

Direct Operating Expenses.Direct operating expenses for the three months ended June 30, 2010 decreased to $15.4 million from $21.5 million for the three months ended June 30, 2009, a decrease of approximately $6.1 million, or 28.4%. This decrease was attributable to the refinery shutdown until its restart in June 2010.

Selling, General and Administrative Expenses.SG&A expenses for the three months ended June 30, 2010 decreased to $1.7 million from $2.0 million for the three months ended June 30, 2009, a decrease of approximately $0.3 million, or 15.0%. This decrease was primarily due to lower payroll and related costs. These costs are allocated to us from Alon USA’s consolidated operations.

Depreciation and Amortization Expenses.Depreciation and amortization expenses for the three months ended June 30, 2010 increased to $5.1 million from $4.9 million for the three months ended June 30, 2009, an increase of approximately $0.2 million, or 4.1%. This increase was primarily attributable to amortization of turnaround and chemical catalyst costs and to the increase to property, plant and equipment in the second half of 2009 related to the amended earnout agreement with Valero.

Operating income (loss).Operating income (loss) for the three months ended June 30, 2010 decreased to ($25.5) million from $1.3 million for the three months ended June 30, 2009, a decrease of $26.8 million. This decrease was attributable to the refinery shutdown until its restart in June 2010.

Interest expense.Interest expense for the three months ended June 30, 2010 was $10.2 million compared to $10.5 million for the three months ended June 30, 2009. The decrease was primarily due to reduced borrowing and letter of credit fees.

Income tax expense.Income tax expense for the three months ended June 30, 2010 was $0.0 million compared to income tax benefit of $1.9 million for the three months ended June 30, 2009. The decrease resulted from no income tax benefit recognized on our pre-tax loss in 2010 compared to an income tax benefit recognized on our pre-tax loss in 2009. Our effective tax rate was 0.0% in the second quarter of 2010, compared to an effective tax rate of 20.5% in the second quarter of 2009.

Net income (loss).Net income (loss) decreased to ($35.7) million in 2010 from ($7.3) million in 2009. This decrease was attributable to the factors discussed above.

Six months ended June 30, 2010 compared to Six months ended June 30, 2009

Net Sales.Net sales for the six months ended June 30, 2010 decreased by $421.8 million, or 70.3%, to $178.0 million from $599.8 million for the six months ended June 30, 2009. The decrease in net sales was due to the refinery shutdown until its restart in June 2010.

Cost of Sales.Cost of sales for the six months ended June 30, 2010 decreased by $308.6 million, or 63.1%, to $180.3 million from $488.9 million for the six months ended June 30, 2009. The decrease in cost of sales was due to the refinery shutdown until its restart in June 2010.

Direct Operating Expenses.Direct operating expenses for the six months ended June 30, 2010 decreased to $25.9 million from $43.9 million for the six months ended June 30, 2009, a decrease of approximately $18.0 million, or 41.0%. This decrease was attributable to the refinery shutdown until its restart in June 2010.

Selling, General and Administrative Expenses.SG&A expenses for the six months ended June 30, 2010 decreased to $3.5 million from $3.7 million for the six months ended June 30, 2009, a decrease of approximately $0.2 million, or 5.4%. This decrease was primarily due to lower payroll and related costs. These costs are allocated to us from Alon USA’s consolidated operations.

Depreciation and Amortization Expenses.Depreciation and amortization expenses for the six months ended June 30, 2010 increased to $10.6 million from $9.2 million for the six months ended June 30, 2009, an increase of approximately $1.4 million, or 15.2%. This increase was primarily attributable to amortization of turnaround and chemical catalyst costs and to the increase to property, plant and equipment in the second half of 2009 related to the amended earnout agreement with Valero.

Operating income (loss).Operating income (loss) for the six months ended June 30, 2010 decreased to ($42.4) million from $54.2 million for the six months ended June 30, 2009, a decrease of $96.6 million. This decrease was attributable to the refinery shutdown until its restart in June 2010.

Interest expense.Interest expense for the six months ended June 30, 2010 was $27.0 million compared to $28.3 million for the six months ended June 30, 2009. The decrease was primarily due to reduced borrowing and letter of credit fees partially offset by the write-off of unamortized debt issuance costs of $6.7 million in the first quarter of 2010 and interest expense related to the liquidation of the 2008 Hedging Agreement of $5.7 million in the first quarter of 2009.

Income tax expense.Income tax expense for the six months ended June 30, 2010 was $0.0 million compared to income tax expense of $6.5 million for the six months ended June 30, 2009. The decrease resulted from no income tax benefit recognized on our pre-tax loss in 2010 compared to expense recognized on our pre-tax income in 2009. Our effective tax rate was 0.0% in 2010, compared to an effective tax rate of 25.2% in 2009.

Net income (loss).Net income (loss) decreased to ($69.3) million in 2010 from $19.4 million in 2009. This decrease was attributable to the factors discussed above.

Liquidity and Capital Resources

Our primary sources of liquidity are cash on hand and cash generated from operating activities. Although our parent company and its parent have previously made certain contributions to our capital, neither has any obligation to make any such contributions in the future.

On March 15, 2010, we entered into a $65.0 million short-term credit facility with Bank Hapoalim B.M. (the “Term Facility”). The Term Facility as currently amended and restated matures on August 16, 2010. We have

agreed in principal with Bank Hapoalim B.M. to extend the maturity date to November 15, 2010. We originally borrowed $65.0 million and have repaid $35.0 million as of June 30, 2010.

On April 21, 2010, we entered into a Supply and Offtake Agreement, which was amended on May 26, 2010 (the “Supply and Offtake Agreement”), with J. Aron & Company (“J. Aron”), the proceeds of which allowed us to retire part of our obligations under the Term Facility and support the operation of the refinery at a minimum of 72,000 barrels per day. Pursuant to the Supply and Offtake Agreement, (i) J. Aron agreed to sell to us, and we agreed to buy from J. Aron, at market price, crude oil for processing at the refinery and (ii) we agreed to sell, and J. Aron agreed to buy, at market price, certain refined products produced at the refinery.

Our ability to generate sufficient cash from our operating activities depends on our future performance, which is subject to general economic, political, financial, competitive and other factors beyond our control. In addition, our future capital expenditures and other cash requirements could be higher than we currently expect as a result of various factors, including the costs of such future capital expenditures related to the expansion of our business.

Depending upon conditions in the capital markets and other factors, we will from time to time consider the issuance of debt or equity securities, or other possible capital markets transactions, the proceeds of which could be used to refinance current indebtedness, extend or replace existing revolving credit facilities or for other corporate purposes. Pursuant to our growth strategy, we will also consider from time to time acquisitions of, and investments in, assets or businesses that complement our existing assets and businesses. Acquisition transactions, if any, are expected to be financed through cash on hand and from operations, bank borrowings, the issuance of debt or equity securities or a combination of two or more of those sources.

Cash Flows

The following table sets forth our cash flows for the six months ended June 30, 2010 and 2009:


	For the Six Months Ended
	June 30,
	2010			2009
Net cash provided by (used in):
Operating activities	$	20,333		$	242,481
Investing activities		(9,898	)		(4,769	)
Financing activities		(36,596	)		(214,263	)

Net increase (decrease) in cash and cash equivalents	$	(26,161	)	$	23,449

Cash Flows Provided By Operating Activities

Net cash provided by operating activities was $20.3 million for the six months ended June 30, 2010 compared to $242.5 million for the six months ended June 30, 2009. The decrease in cash provided by operating activities is primarily due to the decrease in net income primarily due to the extended shutdown and the proceeds received in 2009 from the liquidation of the 2008 Hedging Agreement.

Cash Flows Used In Investing Activities

Net cash used in investing activities has been used primarily for capital expenditures, including expenditures for turnarounds and catalysts. Capital expenditures were $5.5 million and $4.8 million for the six months ended June 30, 2010 and 2009, respectively. Additionally, payments of $4.4 million were made during the six months ended June 30, 2010, associated with the amended earnout agreement with Valero.

Cash Flows Used In Financing Activities

Net cash used in financing activities was $36.6 million for the six months ended June 30, 2010 compared to $214.3 million for the six months ended June 30, 2009. Cash used during the six months ended June 30, 2010 reflects the repayment of the revolving credit facility of $83.3 million which was partially offset by net short-term

debt borrowings of $30.0 million and proceeds from parent equity investment of $11.0 million. Cash used during the six months ended June 30, 2009 reflects repayment of our term loan of $88.2 million and payments on our revolving credit facility of $147.1 million, partially offset by proceeds from parent equity investment of $25.0 million.

Summary of Indebtedness

Senior Secured Notes.In October 2009, we issued $216.5 million in aggregate principal amount of 13.50% senior secured notes (the “Senior Secured Notes”) in a private offering. The Senior Secured Notes were issued at an offering price of 94.857%. The Senior Secured Notes will mature on October 15, 2014 and the entire principal amount is due at maturity. Interest is payable semi-annually in arrears on April 15 and October 15.

We received gross proceeds of $205.4 million from the sale of the Senior Secured Notes (before fees and expenses related to the offering). In connection with the closing, we prepaid in full all outstanding obligations under our term loan. The remaining proceeds from the offering were used for general corporate purposes.

The terms of the Senior Secured Notes are governed by an indenture (the “Indenture”) and the obligations under the Indenture are secured by a first priority lien on our property, plant and equipment and a second priority lien on our cash, accounts receivable and inventory.

On February 17, 2010, we exchanged $216.5 million of Senior Secured Notes for an equivalent amount of Senior Secured Notes (“Exchange Notes”) registered under the Securities Act of 1933. The Exchange Notes are substantially identical to the Senior Secured Notes, except that the Exchange Notes have been registered with the Securities and Exchange Commission and are not subject to transfer restrictions.

At June 30, 2010, and December 31, 2009, the Senior Secured Notes had an outstanding balance (net of unamortized discount) of $206.5 million and $205.7 million, respectively. We are utilizing the effective interest method to amortize the original issue discount over the life of the Senior Secured Notes.

Short-Term Credit Facility.On March 15, 2010, we entered into a $65.0 million term credit facility with Bank Hapoalim B.M. (the “Term Facility”). The Term Facility as currently amended and restated matures on August 16, 2010. We have agreed in principal with Bank Hapoalim B.M. to extend the maturity date to November 15, 2010. The Company borrowed $65.0 million and has repaid $35.0 million as of June 30, 2010.

Borrowings under the Term Facility bear interest at LIBOR plus 3.00% and $30.0 million was outstanding under the Term Facility at June 30, 2010.

The Term Facility is secured by a second lien on all assets other than cash, accounts receivable, and inventory owned by the Company.

Revolving Credit Facility.On March 15, 2010, we terminated our revolving credit facility and repaid all outstanding amounts thereunder. As a result of the prepayment of the revolving credit facility, we recorded a write-off of unamortized debt issuance costs of $6.7 million as interest expense in the first quarter of 2010.

Borrowings of $83.3 million and outstanding letters of credit of $2.8 million were outstanding under the revolving credit facility at December 31, 2009.

Capital Spending

Each year our Board of Directors approves capital projects, including regulatory and planned turnaround projects that our management is authorized to undertake in our annual capital budget. Additionally, at times when conditions warrant or as new opportunities arise, other projects or the expansion of existing projects may be approved. Our updated capital expenditure projections, including expenditures for fixed-bed catalyst and turnarounds, for 2010 is approximately $13.1 million, of which approximately $2.3 million is related to fixed-bed catalyst and turnarounds and approximately $10.8 million is related to various regulatory and compliance projects. Approximately $3.3 million has been spent on various regulatory and compliance projects and $2.2 million has been spent on turnaround and fixed-bed catalyst costs as of June 30, 2010 compared to $3.1 million for various regulatory and compliance projects and $1.7 million for turnaround and fixed-bed catalyst costs for the same period in 2009.

Contractual Obligations

There have been no material changes outside the ordinary course of business from our contractual obligations and commercial commitments detailed in our Annual Report of Form 10-K for the year ended December 31, 2009.

Off-Balance Sheet Arrangements

We are not involved in any off-balance sheet arrangements that have or are reasonably likely to have a material current or future impact on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Earnout Settlement with Valero

In connection with our refinery acquisition, in July 2008 we entered into an earnout agreement with Valero which was amended in August 2009. We have paid Valero approximately $19.7 million in 2009 and $4.4 million in the six months ending June 30, 2010. Additionally, we agreed to pay Valero an additional sum of $10.9 million in five installments of approximately $2.2 million per quarter through the third quarter of 2011 which will result in aggregate earnout payments of $35.0 million.

Critical Accounting Policies

We prepare our financial statements in conformity with GAAP. In order to apply these principles, we must make judgments, assumptions and estimates based on the best available information at the time. Actual results may differ based on the accuracy of the information utilized and subsequent events, some of which we may have little or no control over. Our critical accounting policies are described under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies” in our Annual Report on Form 10-K for the year ended December 31, 2009. Certain critical accounting policies that materially affect the amounts recorded in our financial statements are the use of the LIFO method for valuing certain inventories and the deferral and subsequent amortization of costs associated with major turnarounds and chemical catalysts replacements. No significant changes to the accounting policies have occurred subsequent to December 31, 2009.

New Accounting Standards

New accounting standards are disclosed in Note 1(c) Basis of Presentation and Certain Significant Accounting Policies—New Accounting Standards included in the financial statements included in Item 1 of this report.


ITEM 3.		QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Changes in commodity prices and purchased fuel prices are our primary sources of market risk. Alon USA’s risk management committee oversees all activities associated with the identification, assessment and management of our market risk exposure.

Commodity Price Risk

We are exposed to market risks related to the volatility of crude oil and refined product prices, as well as volatility in the price of natural gas used in our refinery operations. Our financial results can be affected significantly by fluctuations in these prices, which depend on many factors, including demand for crude oil, gasoline and other refined products, changes in the economy, worldwide production levels, worldwide inventory levels and governmental regulatory initiatives. Alon USA’s risk management strategy identifies circumstances in which we may utilize the commodity futures market to manage risk associated with these price fluctuations.

In order to manage the uncertainty relating to inventory price volatility, we have consistently applied a policy of maintaining inventories at or below a targeted operating level. In the past, circumstances have occurred, such as timing of crude oil cargo deliveries, turnaround schedules or shifts in market demand that have resulted in variances between our actual inventory level and our desired target level. Upon the review and approval of Alon USA’s risk management committee, we may utilize the commodity futures market to manage these anticipated inventory variances. In addition, we have entered into and regularly evaluate opportunities to provide us with a minimum fixed cash flow stream on the volume of products hedged during the hedge term and to protect against volatility on commodity prices.

We maintain inventories of crude oil, refined products, blendstocks and asphalt, the values of which are subject to wide fluctuations in market prices driven by world economic conditions, regional and global inventory levels and seasonal conditions. As of June 30, 2010, we held approximately 0.8 million barrels of crude oil and product inventories valued under the LIFO valuation method with an average cost of $53.95 per barrel. Market value exceeded carrying value of LIFO costs by $20.1 million. We refer to this excess as our LIFO reserve. If the market value of these inventories had been $1.00 per barrel lower, our LIFO reserve would have been reduced by $0.8 million.

In accordance with the fair value provisions of ASC 825-10, all commodity futures contracts are recorded at fair value and any changes in fair value between periods is recorded in the profit and loss section of our financial statements. “Forwards” represent physical trades for which pricing and quantities have been set, but the physical product delivery has not occurred by the end of the reporting period. “Futures” represent trades which have been executed on the New York Mercantile Exchange which have not been closed or settled at the end of the reporting period. A “long” represents an obligation to purchase product and a “short” represents an obligation to sell product.

The following table provides information about our derivative commodity instruments as of June 30, 2010:


Description				Wtd Avg Purchase		Wtd Avg Sales					Market			Gain
of Activity	Contract Volume			Price/BBL		Price/BBL		Contract Value			Value			(Loss)
								(in thousands)
Forwards-long (Diesel)		10,908		$	85.58	$	—	$	934		$	880		$	(54	)
Forwards-short (Diesel)		(260,943	)		—		85.45		(22,297	)		(21,362	)		935


Description			Wtd Avg Contract		Wtd Avg Market					Market			Gain
of Activity	Contract Volume		Spread		Spread		Contract Value			Value			(Loss)
							(in thousands)
Futures-crack spread (Heating Oil)		292,400	$	11.84	$	10.46	$	3,463		$	3,059		$	(404	)
Futures-call options		3,514,500		11.35		13.26		(46,535	)		(46,595	)		(60	)


ITEM 4.		CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

(1) Evaluation of Disclosure Controls and Procedures

Our management has evaluated, with the participation of our principal executive and principal financial officers, the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 as amended (the “Exchange Act”)) as of the end of the period covered by this report, and has concluded that our disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or furnish under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms including, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or furnish under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosures.

(2) Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting during the quarter ended June 30, 2010 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION


ITEM 5.		EXHIBITS


Exhibit Number		Description of Exhibit
3.1		Amended and Restated Certificate of Incorporation of Alon Refining Krotz Springs, Inc. (incorporated by reference to Exhibit 3.1 to Form S-4, filed by Alon Refining Krotz Springs, Inc. on December 22, 2009, SEC File No. 333-163942).

3.2		Amended and Restated Bylaws of Alon Refining Krotz Springs, Inc. (incorporated by reference to Exhibit 3.2 to Form S-4, filed by the Alon Refining Krotz Springs, Inc. on December 22, 2009, SEC File No. 333-163942).

4.1		Indenture, dated as of October 22, 2009, by and among Alon Refining Krotz Springs, Inc. and Wilmington Trust FSB, as Trustee (incorporated by reference to Exhibit 4.1 to Form 8-K, filed by Alon USA Energy, Inc. on October 23, 2009, SEC File No. 001-32567).

10.1		Amendment No. 1 to Credit Agreement, dated May 28, 2010, among Alon Refining Krotz Springs, Inc., each other party joined as a borrower thereunder from time to time, the Lenders party thereto, and Bank Hapoalim B.M., as Administrative Agent (incorporated by reference to Exhibit 10.3 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

10.2		Amendment No. 2 to Credit Agreement, dated June 15, 2010, among Alon Refining Krotz Springs, Inc., each other party joined as a borrower thereunder from time to time, the Lenders party thereto, and Bank Hapoalim B.M., as Administrative Agent (incorporated by reference to Exhibit 10.4 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

10.3		Credit Agreement, dated May 28, 2010, by and between Alon Refining Krotz Springs, Inc. and Goldman Sachs Bank USA, as Issuing Bank (incorporated by reference to Exhibit 10.5 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

10.4		Amended and Restated Supply and Offtake Agreement, dated May 26, 2010 by and between Alon Refining Krotz Springs, Inc. and J. Aron & Company (incorporated by reference to Exhibit 10.6 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

31.1		Certifications of Chief Executive Officer pursuant to §302 of the Sarbanes-Oxley Act of 2002.

31.2		Certifications of Chief Financial Officer pursuant to §302 of the Sarbanes-Oxley Act of 2002.

32.1		Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



Date: August 6, 2010	By:	/s/ David Wiessman
		David Wiessman
		Executive Chairman


Date: August 6, 2010	By:	/s/ Jeff D. Morris
		Jeff D. Morris
		Chief Executive Officer


Date: August 6, 2010	By:	/s/ Shai Even
		Shai Even
		Chief Financial Officer

- 28 -

EXHIBITS


Exhibit Number		Description of Exhibit
3.1		Amended and Restated Certificate of Incorporation of Alon Refining Krotz Springs, Inc. (incorporated by reference to Exhibit 3.1 to Form S-4, filed by Alon Refining Krotz Springs, Inc. on December 22, 2009, SEC File No. 333-163942).

3.2		Amended and Restated Bylaws of Alon Refining Krotz Springs, Inc. (incorporated by reference to Exhibit 3.2 to Form S-4, filed by the Alon Refining Krotz Springs, Inc. on December 22, 2009, SEC File No. 333-163942).

4.1		Indenture, dated as of October 22, 2009, by and among Alon Refining Krotz Springs, Inc. and Wilmington Trust FSB, as Trustee (incorporated by reference to Exhibit 4.1 to Form 8-K, filed by Alon USA Energy, Inc. on October 23, 2009, SEC File No. 001-32567).

10.1		Amendment No. 1 to Credit Agreement, dated May 28, 2010, among Alon Refining Krotz Springs, Inc., each other party joined as a borrower thereunder from time to time, the Lenders party thereto, and Bank Hapoalim B.M., as Administrative Agent (incorporated by reference to Exhibit 10.3 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

10.2		Amendment No. 2 to Credit Agreement, dated June 15, 2010, among Alon Refining Krotz Springs, Inc., each other party joined as a borrower thereunder from time to time, the Lenders party thereto, and Bank Hapoalim B.M., as Administrative Agent (incorporated by reference to Exhibit 10.4 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

10.3		Credit Agreement, dated May 28, 2010, by and between Alon Refining Krotz Springs, Inc. and Goldman Sachs Bank USA, as Issuing Bank (incorporated by reference to Exhibit 10.5 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

10.4		Amended and Restated Supply and Offtake Agreement, dated May 26, 2010 by and between Alon Refining Krotz Springs, Inc. and J. Aron & Company (incorporated by reference to Exhibit 10.6 to Form 10-Q, filed by Alon USA Energy, Inc. on August 9, 2010, SEC File No. 333-124797).

31.1		Certifications of Chief Executive Officer pursuant to §302 of the Sarbanes-Oxley Act of 2002.

31.2		Certifications of Chief Financial Officer pursuant to §302 of the Sarbanes-Oxley Act of 2002.

32.1		Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002.

Positive
Negative
Uncertain
Constraining
Legalese
Litigious
Readability	H.S. freshman Avg

Alon Refining Krotz Springs Inactive 10-Q2010 Q2 Quarterly report

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