Earnings call transcript Q1 2023

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Operator

Greetings, and welcome to the Valero First Quarter 2023 Earnings Conference Call. [Operator Instructions].

It is now my pleasure to introduce your host, Homer Bhullar, Vice President of Investor Relations. Thank you.

You may begin.

Homer Bhullar

welcome Call. Energy and XXXX First everyone, Conference Earnings morning, to Corporation's Valero Quarter Good today Joe Fraser, team. me Executive several our President With other are CFO; Vice President Lane and and Valero's Commercial and Riggs, President CEO; members and COO; Officer; Simmons, of Jason Gary our Chief Vice Gorder, Executive our our and Chairman management senior

our copy, received investorvalero.com. If release a find earnings not like the you you website one on have would and can at

are release on earnings that provide and the and information to attached adjusted call. tables additional financial on our reconciliations Also this segments business metrics disclosures for mentioned

any have team you free the to these our questions If tables, after please feel after reviewing call. Relations Investor contact

disclaimer intended by says from I In earnings this our of factors press company's would filings those future actual SEC. and management's now statements differ that to that conference to your the to or like release many the are described or in statement in expectations summary, call results we've be contained release. could are direct and it attention the forward-looking in with provisions predictions forward-looking safe under press the expectations, state on securities that There the the covered release statements cause laws. federal our harbor including to

the over turn remarks. to call I'll Now Joe for opening

Joseph Gorder

strong all of with had our quarter Thanks, well. and another everyone. performing morning, Homer, We good segments

planned rate at utilization Our facilities. at despite maintenance capacity refineries XX% operated several

lower capacity undertaking a our activities commitment Refining product long-standing strong margins supported Our excellence. ability and throughput industry in the illustrates to to optimize refining from benefits of system by maintenance backdrop demand. maximize operational while were

crude incremental up in successfully process our expected engineering and the which the to coker to is Port proud to while testament throughput sour project increase and to and started was efficiency. report of also March residual improving completed early oils Arthur feedstocks teams. volumes ability operations project strength of a is turnaround I'm The refinery's April, the that and in capacity also

volume sales Valero. started in will or Texas. DGD $XXX with diesel in estimated with approximately XX% its DGD is aviation SAF. have Port continued to Our half DGD the to capability the Renewable which aviation announced cost was Arthur, November ramp-up of sustainable attributable XXX XXXX Port XXXX. first at Arthur we quarter, project record a in upgrade fuel be sustainable the Port is up approved set The plant current Diesel another project annual million, of In January, that capacity segment to approximately of The million-gallon to production renewable completed expected and to that Arthur,

of to the completion this DGD the SAF be largest the world. X manufacturers project, is expected of With of in

In expect in begin segment, XXXX. the activities carbon BlackRock sequestration they start-up and Ethanol to progressing, project and is Navigator's late

with anchor the expect business. of us We allow lower our of will improve X profile which positioning to significantly ethanol carbon-intensity be the to our a product to and plants system ethanol competitive Ethanol connected shipper and margin this produce

additional and such advance low-carbon projects. alcohol jet carbon renewable to continue we opportunities, naphtha renewable hydrogen, And to other and as sequestration

return must of minimum process. review meet projects our threshold gated to All our continue through a progress to

quarter capitalization ratio sheet, continue financial to by XX%. debt the balance million we On net strengthen and a reducing the in our with debt side, $XXX the quarter first of to ending

from per in stockholder $X.XX returns. share increase our $X.XX dividend common share, to commitment In quarterly January, we stock per our to long-standing demonstrating on our announced an

peak global inventories, driving low Looking remain summer to supported air as expect product product season. ahead, increase continued and and product light demand tight supply demand and fundamentals approach we balances by in refining travel we

manner. affordable strategy a strategy, deploying successfully the continue been in our commitment world's for with underpinned challenge focus The to environmentally returns to for nearly meet honoring of our uncompromising an supplying reliable position future. tenets and place stockholders to have continues by and that and operational well responsible the decade of for team our need enables excellence, capital the in to closing, execute In a us an energy on us

that, I'll hand call Homer, you. to with So the back

Homer Bhullar

Joe. Thanks,

For the share of first XXXX, attributable to share stockholders to or of first million $XXX quarter or was billion for $X.XX net the $X.X Valero per per income quarter compared $X.XX XXXX.

share quarter net share for XXXX. adjusted Valero to million of compared or $X.XX per income the XXXX billion attributable $X.XX quarter or to $X.X first stockholders $XXX was First per

to the release and reconciliations please tables. the earnings adjusted For earnings to amounts, accompanying refer release

of day, Refining of throughput quarter of barrels XXXX operating the XXX,XXX compared compared the volumes of income The than first the day for billion billion of quarter million Refining XXXX $X.X the X.X first the in the XXXX. averaged first XX% utilization reported to quarter first for XXXX per segment first was capacity $X.X Throughput first higher XXXX. of of quarter per to in quarter which was in barrels XX% XXXX. quarter

prices. barrel $X.XX expenses quarter XXXX, lower attributed Refining $X.XX, guidance and throughput cash per natural the were lower in operating gas than higher first primarily of of to

to $XXX million first X.X Renewable to the of XXXX. quarter Port for from quarter first of quarter volumes which for income gallons X were DGD of gallons first million quarter diesel sales in volumes fourth XXXX. the of averaged Renewable XXXX. was of first quarter start-up day impact The Arthur in the the quarter higher million plant in than Diesel million first the $XXX day of was the segment operating additional per of per sales the due XXXX the the higher volumes compared of XXXX, XXXX

the the operating of $X XXXX. Ethanol million for million of XXXX quarter XXXX. to quarter in $XX first of first quarter X.X production was gallons than quarter volumes gallons the of per first averaged reported which higher day segment income per the million of compared first day for XXXX, Ethanol The XXX,XXX

the was $XXX and million $XXX G&A were million. interest of quarter XXXX, first For net expenses expense

XX%. The million $XXX tax was XXXX. for Depreciation million, expense the and was quarter and $XXX first of was rate amortization tax expense income effective

activities XXXX. in quarter billion provided first of $X.X the cash by was Net operating

Excluding DGD's changes by of net venture the $X.X working activities the in in in operating activities was provided adjusted DGD's billion. $XXX excluding quarter unfavorable million other and net capital, working member the cash capital by share of change first provided cash joint operating

Regarding in of capital for compliance, the million first investing of $XXX regulatory activities, made the was of investments business, business. was for costs quarter we million the including which XXXX, catalysts growing $XXX sustaining and million and $XXX for turnarounds,

venture DGD, in Valero the capital members the attributable other investments of $XXX quarter to investments joint million of were XXXX. capital Excluding attributable share to first

payout $XXX XXXX, of $X.X XX was in and [indiscernible] stockholders resulting activities. was financing of over to the of by our as dividends ratio billion million activities. the paid purchase shares cash million We net which billion of of in to operating returned for $X.X Moving stock, XX% provided quarter first of common a approximately

$X as additional of billion The in cash debt-to-capitalization finance obligations With billion debt, the XX% million respect by the reduced that first reduction total and We XX, opportunistic completed lease quarter of to equivalents, March of $X.X through $XXX and transactions and with was our we ratio, quarter Valero's open sheet, mentioned, XXXX. debt cash cash as of billion ended $X.X Joe of net cash balance equivalents. debt repurchases. market

$X.X available cash. And excluding well billion with capitalized liquidity, we ended quarter of the

Turning to guidance.

which allocated capital About investments. and includes the is growth. to joint expenditures the $X investments for turnarounds, to XXXX sustaining venture of We for business expect to balance Valero attributable to that catalysts $X.X billion be billion, and approximately

Mid-Continent XXX,XXX per second we to day; X.XX barrels at barrels For X.XX Refining per our XXX,XXX the Atlantic per volumes barrels XXX,XXX XXX,XXX million within XXX,XXX throughput quarter modeling to ranges: million fall at to day; day; barrels following at North at Coast operations, day. expect and to Gulf West per to Coast XXX,XXX

approximately per in barrel. cash to quarter be Refining the $X.XX We second expect operating expenses

gallon, gallon to XXXX respect in costs as noncash which Operating the sales Renewable volumes billion and approximately be we to be X.X expect should includes $X.XX per amortization. such With in Diesel for XXXX. depreciation expenses segment, gallons per

depreciation Ethanol second which average Our Operating amortization. $X.XX day is expenses per expected costs quarter. such as X.X per for $X.XX and million segment should gallon the produce in per gallon, noncash includes to gallons

expense net and depreciation million. about quarter, $XXX second $XXX be the amortization and should be For approximately interest expense should total million,

$XXX corporate expect approximately For XXXX, we be to G&A depreciation, expenses, excluding million.

[Operator opening concludes Instructions]. remarks. That our

Operator

[Operator Instructions].

first is Manav Gupta of the coming with line UBS. from Our question

Manav Gupta

Congrats heavy turnaround. such not out if refiners sure who other are capture I'm result. of very there on many with there kind good can a show this

So data, that. DOE quick I'll I and congrats which is on sense. but sometimes seeing two revisions, ask have questions make them much keep too We to doesn't actually prone upfront.

products, various in across seeing demand system for you your in system? what in products are your Joe, various terms So of

dynamics. diesel second could weak? related a the And help Is suddenly just bit oversupplied? diesel little market. we demand Are understand going in you us If what's through and talk is, those the the on question

Joseph Gorder

some No, to that, them your Manav, you Gary, do we're happy to thanks insight? for and do want comments. give

Gary Simmons

Yes, sure.

XX% so average far, up wholesale in our X-day year-over-year. are So, our sales our system, gasoline

Our diesel volumes year-over-year. XX% up are

So our to wholesale do continues a great team job.

we are March, day. record at those the right XXX,XXX a In volumes In trending a April, barrels levels. set along

even very, the is data for And So demand system. racks strong the well. industry in as wholesale DTN our strong across seems the very very

you, In terms to that's along volumes, not X of PADD in can planting going into open are a the in just surge today, season. domestic PADD we're wholesale agricultural as your question seeing seeing there's from we're addition that on it. X arbs I diesel tell weakness, demand with

X. domestic Latin We a to to have strong ship from arb to The PADD see also Europe. waterborne premiums arb X America. go to PADD transatlantic You is open to open

pretty us, for good. fundamentals look so And distillate

Operator

from next line Chen Our with Barclays. the question is of Theresa coming

Theresa Chen

Gulf Coast Coast differentials your near you should coker the Arthur tailwind, Net-net, Can your do of you also system, from Port Gulf how the we've outlook in. on of here? be profitability come both start-up Clearly, and the term? term comment view for a longer capture seen but

Lane Riggs

of some is first capture to rate quarter capture Lane. less [indiscernible] second sort Holding rates, things general we'll blend quarter rate. this our equal, our compare about butane. comments capture Yes, all

butane. capture equal, everything just actually to pulling -- everything rate fall due will our So

lower. as then the they're what's alluded look of you you And trajectory feedstocks, at to, feedstocks,

it, RBOB we're On CBOB. seeing premiums versus big the other side of

not in that's positive. extent So that's to the a that, capture rate, captured our actually

Those got things that kind or, crack be those RBOB predict to relative maybe are CBOB. So to for to some our tied example what there our those I And Maya key like the the WCS attainment drivers you of you the you formula to An change said, versus trying how and things of focus got crack our on attainment on are just -- things in how guys looks. look versus are at. would not are several to. may be

Theresa Chen

BGO And Gulf on as well as related the the Coast on evolving terms consumption situation see EU [indiscernible] after supply the well Russian exporting global in Saudis as as note, products conversion do a following the you of on how your unit? embargo its less

Lane Riggs

and let at -- of kind and shoring The system boiling our our Well, start-up where up VGO It's to essentially way cracking I'll resid least Gary of -- Arthur start our of the a material. is. supply. sort position. that's it long and into crudes on heavier Coker at Port talk in VGO the Essentially, about look a distillate and taking range goes

So our it sort has to new fallen allows VGO post -- startup. importing requirement for us coker of the

Gary Simmons

Yes.

against we supply, terms VGO think concerned the sanctions cause limit Russia would and I exports In that were tightness. of ramp-up VGO in

So barrels looks to the like far, it flow. continuing are Russian

so earlier about year. concerned as And not as the we VGO in nearly we're supply were

Operator

next question with the America. Doug from of line Leggate of Our coming is Bank

Kalei Akamine

could the heavy is sours question, that shorter increased with is cuts and really goes got that of about hydrocracker of talk your Theresa's kind refineries, to where There Can new that projects getting I've for resid the such situation. demand Doug. on MPC's are perception as new squeezing those in of the if perhaps a what you are to alleviate not supplies. are This seeing it phased from is units OPEC online, start-ups market are a and and all then the and that, you length coker follow-up the availability guys market. the Kalei for help

Gary Simmons

Yes.

through. So I'll go

quarter, sour the We get balances around we saw supply-demand heavy tighter. -- have first during seen the

it is supply. of Some

system. the -- to year. make You way the is forecasted which Chevron maintenance. saw in to is reporting view factors. think is Platts is the more ramp-up, a that also as will from I refinery utilization barrels going And bullish more production put We'll production production region Gulf our we due get there forward, Canadian off-line But crude that some are into day. Venezuelan progress see through Chinese demand its back. XXX,XXX production that grow.

are and are bullish point currently point balances need some being again which that sour -- At production then indications come all is will that kick supply-demand on at market, that to the back in the time, differentials. the correct, OPEC down, demand the the refinery Lyondell time, if some more which forecasted market. will to And back you'll in heavy are

Kalei Akamine

Got seeing Can that. it. refining Bocas and you're online, Dangote And new capacity to supposed Dos Mexico? what a for quick to talk you follow-up like come about that's in

Gary Simmons

insight I really lot a We of make one into can't refineries. Yes, either have a of comment. those don't

Operator

you. Thank

question is from next line JPMorgan. Our John of with coming Royall the

John Royall

Just wanted to return the of start capital on side.

to you quarter down latest a your to be thinking indicators. I strong, sheet appear in of XX% you fundamentals very balance above in and range to see be but your What's this think XX% range in returned quarter, your second guys is that on You your ticking returns row. where want that shareholders given can again to

Jason Fraser

good in billion ratio XX%, strong the cash, our We've This that's shape there. of We And good a right. lower into Jason. down is our well got pretty at net feel balance now. debt $X.X over to got around right No, range. you're Yes. we right, cap spot is of our end up which sheet is

So pretty we we're a feel good any spot potential conditions. recessionary regard to like with in

range, when we to as where be to in our strong results. XX% our XX% we far And target we'll have target the as to continue for want

little end. paid Of extra with we we all-of-the-above XX% the and of paid be to debt. course, upper quarter. a the at able build back cash did kind million. XX% at cash had, our we'll also this last we more looking Actually out $XXX XX% ended by were at that. an of We strategy, Payout year,

will it right, on where how range, in depend the plays year the in the we out, payout just So range. fall

John Royall

you market play I broad out those changes you impact touch then And the how California. the on expect hoping business the out and just refining your was on Great. maybe could also and California regulatory potential to both in in and

Richard Walsh

of operations. always start the I California Rich. climate. tough with is regulatory can sort out a This just been has climate for regulatory

burden, California assuming out then basically just Energy X tax it would talking you're some what the say California the reporting in does there. requirements implement some about I'm bill over Commission it. obviously, And so profit we to And a this rulemaking is it. to that And kicks have that's

that And ultimately rulemaking so there. watch stay we'll active in agency price develops any, they'll unclear put and process It's in if and the of engaged what place. out what cap,

governments goes consumers. supposed ultimately the economy cost is that to they're that been out artificially never benefits prices that, determine to are for point And the it by on that good it the up without is to would consumers. I saying that limit and the really standard outweighed by hurting consumers the to agency rulemaking attempts supposed the has to commodity use potential ends

plays just we'll all that see So out. have to how

Joseph Gorder

And John, Joe. this is

said. let something Just what on me Rich bolt to

we manage Great our operating -- refineries great team plants. it's on those very of have running capital So we And clear aggressively West maintain growing and out there, a safe now. both Coast. in capital, but the our invested in have reliable many operations approach business is and are we teams consistent been business. we California years That for we haven't to the to that the invest

in a in that environment, margin Now upside, return a a levels opportunity And contributor always set we'll as the the option isn't historically, evaluate caps on earnings. options. been to operating there periodically earn strong it the have to California, it's We've and remove the at our strong an viewed way if are our to the margins. normal isn't past

what concerns there. and and have his to others that happens and Right to see just are we're wait we Rich out communicating Commission California now, team the Energy have, to and the going

even just refining I happen the see would we'll you stating tell not might is it an we're options. that to there, at to but our a So evaluate a can have out our that shot it from and what overall difficult environment operating environment take and environment. watch to is I going just perspective, then

Operator

Paul of the coming from is next question with The Sankey Research. line Sankey

Paul Sankey

repeat that's and just I come, massively. the you heard gave you growing right, that explain demand if how sales so number Could you wholesale

Gary Simmons

Yes.

year-over-year. we're on XXX,XXX April, XX% we're And then wholesale distillate, trending the side, about volume day. a March, the like year-over-year. XX% they in did barrels we up set record our are a March. up On sales gasoline volumes So

at seeing, volume DTN as capturing broader a So look we're you it's is and significant so certainly, wholesale when indicates not of the what we're doing data, job growth market share. it good

Paul Sankey

there's better no just performance? So structural change. It's wholesale

Gary Simmons

Yes.

Joe. counting as I'm Okay. question, not a that

Joseph Gorder

could Paul, we talk day. all

Paul Sankey

actually. D.C. in I'm

how -- on latest with could the how Washington on but the IRA, got already, on think, shifting. what's things your terms thoughts had in California the are impact We've On your the dealt call environment? if of one, business regulatory latest you've we've thinking that I any in

And a Obviously, deal big the other how about it's one, I thinking carbon guess, capture here. you're that. is and

Richard Walsh

again. Rich the Walsh think I effort going to to out. be you're has the guess just to to of is right Republican negotiations on this bill terms an respond this I'll now. are morning, of back Well, in pull take I some in some And revised that been that were think credits to on that I proposing probably they alluding include --

at tax the projects energy back put back we're some And side sequestration being and so so things in. in, us our of that on our looking renewable and the credits help clean

already out, been the made they have SAF investment back projects And that are while also on SAF grandfathered the have decisions that [indiscernible] announced those have on is in.

projects on eligible be that. would for still So treatments proper means our the that

Paul Sankey

Got it. Yes.

definitely I a SAF think is that one. very interesting

be about deliveries. -- The margins, generally an saying the that wholesale come your your demand seasonally. there especially gasoline seem margins which there. about is leave wholesale great it off Is you're fundamentals. . odd the I'll big bit week entirely seen going how given We by shape a a QX here you out? what this observe seen we've is then had number, And market, in thoughts in that sell-off awful somehow supported we've for example, to on is lot, Any doesn't Okay. And anything to can speaking,

Gary Simmons

it is and our steep news the is of is significant Yes, whenever where low it prices a impact view market way on today, just any inventory have type and out slope on is as really curve Paul, margin margins. you can as the puts

Today, drove So continue the lot economy will flow barrels ramp-up generally all and headlines concern it market the in the supply Russian in that losing year, up. demand to were comfortable early Russian then with the in happens think sanctions the the market and people about the with are on of I and what future. a

As I've a that's said, the demand of we're in but happens seeing not concern today, think weakness is indication I future. what any

Operator

The next Fargo. of coming is Roger question line from with Wells Read the

Roger Read

ton I'd up, like Joe in markets. demand Comments mean pipeline, there's or Yes, like stress of you're a to the Colonial shows diesel follow I'd the supply. one to But to and market. ways it gasoline up of on and is the -- of to looking end gasoline clear pay each how the we follow at and shortfalls track I attention

into guess there? of York is what is Basin, I'd see on you between supply. to like maybe just I Europe issue? gasoline So terms in component dig exactly New in Or going it outright what a particularly the Northwest Or and Atlantic

Gary Simmons

Yes.

it New gasoline Harbor. there several play made that. see are the winter, or it I do Historically, market to So come economic This wasn't to an structure store there, summer-grade that York to incentive Roger. factors think components where into we really

so we inventory did that. And build for

York kind you into the occurred early And well. the Atlantic Harbor as France minimized lot typically and across going first volumes in strikes volume year, those again, of a the quarter, of the New from then, in Europe that in see

where inventory. were XX So into with we we've gasoline driving on come below million last year barrels season

tight, it into So move especially stress is the is driving summer very gasoline season. system grade going to Colonial and we as

Roger Read

before. I the the this mean haven't in large the it's at of seen Yes. this but early time quarter, quite year really gap

opportunities I SAF. the shows legislatively. on forward in it of moving mentioned some terms question, Follow-up stress. definitely could, there if are Obviously, So what's you

do margins, versus the renewable let's SAF? driver weren't LCFS you support to want already If SAF that well as mean, what's as enjoys it, obviously fundamental to to do diesel for you make programs. see, support call I which

Unidentified Company Representative

Roger, this is Eric.

I in big The mandating just as percentages XXXX we talked and future. to EU a beginning increasing for SAP you still it the XXXX demand see at get and in think about XXXX.

driver IRA for the SAF. So only isn't the

airlines obligate strategic SAF a what to in still between and as we a starting and have internal to growth carriers we that mandatory from area corporate it see standpoint, that renewables. as think, going is make see requirement well just commitments lot a jurisdictions different a I the the for made be cargo jet of

Operator

Sandler. next Piper is The of Ryan with the question coming line from Todd

Ryan Todd

talk that there on What of renewable bit earlier either support those call, would the carbon those of you in in Maybe to mentioned current operations? your of regulatory required like I'll side. Can alcohol a mentioned you product are carbon low for jet. couple about make further [indiscernible] stick either changes fuel you businesses follow-up look one that little make projects in be would sense? possibilities the a And prices the or

Unidentified Company Representative

-- I ethanol start again. Eric In with jet. we'll think this to particular, Well, is

Assuming the a a to intensity project lower point as goes of Navigator into our will will the qualify it ethanol that SAF. where feedstock carbon forward,

that ethanol things jet you at. to look of that precursor an the as one would project the SAF And at enable so we're then if looking that's project,

standpoint. we out about would project what years that's that talk detail, possibility kind of up Now but that's any of from a in conceptually from sort line anything would

another your to make hydrogen, you platforms, another way operations. horizon And further that's green blue renewable then of opportunity, if or lower your can CIs your it's that hydrogen, as at low sort on low-carbon carbon look you just

Ryan Todd

contribution there coker. that there? How is to -- any the the on there with that of up. the should associated of what environment? And in annualized ramp EBITDA second Author or updates contributions thoughts current of kind maybe in kind Is quarter? -- expect what sort getting on the And you we quick think on any the Is started follow-up just Great. congratulations then Port a operations

Lane Riggs

Lane. is this Yes,

through most say the sort it X. So would we've full. ramped fuel to week, we of to where the comments. his to well close as now quarter, indicated. the had will start-up, Clean up to we're [indiscernible]. as working actually, this of see It rest [indiscernible] up just of done our was we team. from alluded up earlier benefit April Joe in We're sort of the running. by really I you refinery of on started We're It's

EBITDA, $X.X of the on you it, volumetrics forward sort the billion pricing about and year it's is terms In of take a normally contribution when on current use the benefit.

Operator

Our next question is coming from Cowen. Gabelman the with line of TD Jason

Jason Gabelman

to I wanted ask one market structure. on

there's headlines some think around there's Asia some and because are into that concern low margins could because refining that, the cutting I U.S. there's runs there concern permeate

are indicator? because that should will the the it closer Or the because of there I and margins falling, guess, declines is, follow of U.S. tailwinds there's of but the question kind of Asia kind are falling while bit are level Should so Asia I question, give it's they is probably so demand And global related cracks are, throughput U.S. that take Asia know are absorbing to margins floor, market of a they kind a and complex global that weakness? of think structural because out how conversely, the around to shot. a a all issues?

Gary Simmons

Yes.

but in Europe view would of said, floor are think the it negative. the is margins just like Asia, I So we you much where telling as view us kind would way on it's margins. It's we it not

see should weakness. very we lot be still inventory a that the is of actually low. And view running. that We of very, so And diesel that capacity some distillate

margins of And it's you are. telling we're so the floor on kind where

Jason Gabelman

in received yet? And thinking are Okay. That's to then the the about soon? up forward? on cash Have that moved you DGD. of distribution? that are moving you Is coming DGD And helpful. follow-up one the being how terms we Where partners

Unidentified Company Representative

opportunity a flow, Yes. an back DGD we say We've half this still cash the looked see at for the we of distribution year in would partners. and the becoming

Jason Gabelman

the Okay. Any idea around quantity?

Unidentified Company Representative

end No, year. look we're the but that give number does positive a to through going out, the it like of not

Operator

is question coming from Tudor, next Matthew line Pickering, of Our the Holt. with Blair

Matthew Blair

bit Joe, figure, could understand QX the you capture, help more. refining little strong a us a

I of specifically, in think And Lane a XXXX impact any also, more was else from as you supporting a drove XX? like RINs guess, than tailwind. RINs, blending XXXX What I then submitted factor product mark-to-market in turning it any butane up? March And mentioned there sort normal? of exports was the of the were

Lane Riggs

is Lane. part start I'll it. first the of this Matt, out with So

were sort So that of are feedstock. backwardation things get. market contributing had out That's one in you the factors the we flattened always on

market rates So capture into way. plays structure a big in

some. it's So out tightened

You we run. had all the on the that crudes versus wider differentials first fourth quarter quarter the in

premiums respect the pretty good our in then driving And finally, those things there were quarter. jet versus are mentioned... distillate other capture the With first other the -- Those on rate. to

Joseph Gorder

the anything think RIN I don't it. do to had with

Gary Simmons

And I on wouldn't say exports had any kind of material impact capture rates either.

Matthew Blair

utilization. guidance, implies about it it XX% Great. And looks XX% to Refining on the QX like then

already QX. XX% did in You

aware if guess number? we rate? expected it that should major QX think I down. there down that of Or are we there just turnarounds about as it just your -- surprised I'd run conservative be ticks pulling are -- be that's Is So a should

Lane Riggs

Lane. -- we is this Yes,

not be. of take policy our directly a where we really activity, but I guidance turnaround the be have would it's just think of on kind We commenting going to to

Joseph Gorder

Yes. Matthew, not And mean, to I you going mean we're history our and oversell anything. tendency. I know our

lane's we'll appropriate. So markets -- right, look. just the we'll operate as how we'll And see

Operator

at have We no additional time. this questions

over the closing floor management for I'll So any remarks. pass additional to

Homer Bhullar

questions. have great a IR contact you, us if appreciate joining Thank you Jesse. Thanks, Obviously, the week. We any everyone. to feel free today. team Have everyone

Operator

this Ladies webcast. does and conclude and call gentlemen, our

for You may disconnect We your you lines your at this participation. time. thank

Valero Energy (VLO) 27 Apr 232023 Q1 Earnings call transcript