Welcome to HollyFrontier Corporation's first quarter 2017 conference call and webcast. Hosting the call today from HollyFrontier is George Damiris, President and Chief Executive Officer. He is joined by Richard Voliva, Executive Vice President and Chief Financial Officer, and Thomas Creery, President, Refining and Marketing. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star one on your touchtone phone. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. If you should require operator assistance, please press star zero. We ask that you please limit yourself to one question and one follow-up. Additionally, we ask that you pick up your handset to allow optimal sound quality.
Please note that this conference is being recorded. It is now my pleasure to turn the floor over to Craig Biery, Director, Investor Relations. Craig, you may begin.
Thank you, Sharon. Good morning, everyone, and welcome to HollyFrontier Corporation's first quarter 2017 earnings call. I'm Craig Biery, Director of Investor Relations for HollyFrontier. This morning, we issued a press release announcing results for the quarter ending March 31st, 2017. If you would like a copy of the press release, you may find one on our website at hollyfrontier.com. Before George, Tom, and Rich proceed with their remarks, please note the safe harbor disclosure statement in today's press release. In summary, it says statements made regarding management expectations, judgments, or predictions are forward-looking statements. These statements are intended to be covered under the safe harbor provisions of federal security law. There are many factors that could cause results to differ from expectations, including those noted in our SEC filings. Today's statements are not guarantees of future outcomes.
The call also may include discussion of non-GAAP measures, and please see the press release for reconciliations to GAAP financial measures. Also, please note that information presented on today's call speaks only as of today, May 3rd, 2017. Any time-sensitive information provided may no longer be accurate at the time of any webcast replay or reading of the transcript. With that, I'll turn the call over to George Damiris.
Thanks, Craig. Good morning, everyone. Today, we reported first quarter net loss attributable to HFC shareholders of $45.5 million or $0.26 per diluted share. Certain items detailed in our earnings release that Rich will discuss in his prepared remarks decreased net income by $12 million on an after-tax basis. Excluding these items, net loss for the quarter was $33.4 million versus a loss of $10 million for the same period last year. Adjusted EBITDA for the period was $85 million, a 10% decrease compared to the first quarter of 2016. This decrease is principally attributable to lower refinery segment production and sales volumes from heavy maintenance during the period, partially offset by earnings from our recently acquired Petro-Canada Lubricants business, PCLI. We're pleased to report the first two months of financial performance from PCLI in our consolidated earnings.
Adjusted EBITDA for February and March was $28 million, in line with our annual guidance range. Our sales averaged 24,140 barrels per day, and our operating costs were $36 million for the period. We are currently seeing strength in the base oil market driven by seasonal demand and look forward to recognizing a full quarter of earnings in the second quarter. This morning, we published a lubricants primer on our HFC investor relations page to provide you with a deeper insight into our lubricants business. The integration of PCLI continues to progress smoothly. We appreciate the warm reception from our new, talented, knowledgeable, and dedicated colleagues and welcome them and the skills and capabilities they bring to HFC. We remain confident in our $20 million per year synergy target and expect to realize these benefits as we further integrate our two lubricants businesses.
Combining PCLI with our existing Tulsa specialty lubricants business creates scale, diversity, operational and financial synergies, and a solid platform for growth. There's also opportunity to increase Group III base oil production through feedstock optimization, allowing for significant margin uplift potential. We're excited about our growing presence in the lubricants industry and are encouraged by our progress integrating PCLI into HollyFrontier. Our refining outlook for 2017 remains cautiously optimistic. We anticipate solid economic growth will continue to support refined product demand, and sustained growth in domestic crude oil production will lead to improved crude differentials. We're also optimistic that a more favorable regulatory environment could provide a tailwind for both the refining industry and the economy as a whole. With a large portion of our scheduled maintenance behind us, we are poised for strong financial and operational performance for the remainder of the year.
Now I'll turn the call over to Tom for an update on our operations and commercial activity.
Thanks, George, and good morning, everyone. On the operations side, we had a first quarter crude throughput of 371,000 barrels per day versus our guidance of 350-360,000 barrels a day as driven by a heavy maintenance schedule. During the quarter, we successfully completed a very large turnaround at our Navajo refinery. In fact, this turnaround was one of the largest in company history and included the revamps to multiple units as part of our $40 million efficiency and debottleneck project
Thereby increasing Navajo's overall throughput capacity and allowing us to run more of the higher API gravity crude oils coming out of the Delaware Basin. We had unplanned maintenance on our Tulsa reformer and planned maintenance at the El Dorado vacuum tower. During the Tulsa outage, we were able to accelerate other maintenance and a catalyst upgrade originally planned for later this year, all of which allowed us to benefit from higher liquid yields and octane during the summer driving season. We have no major planned downtime until our scheduled turnaround at Tulsa West in November of this year. We are focused on improving operations and reliability at our Cheyenne plant, and we expect our performance to continue trending in the right direction in the Rockies region. During the quarter, we ran an average crude rate of 74,710 barrels per day.
Cheyenne operations are improving, and we ran at a very strong 48,300 barrels per day crude rate in the month of March. Adjusting for HEP tariffs embedded in the Woods Cross and Rocky Mountain OPEX was $8.91 per barrel. This amounted to a 10% reduction over fourth quarter of 2016. On the commercial side, we ran 26% sour and 19% WCS and black wax crude. Our average laid-in crude cost under WTI was $0.61 in the MidCon, $3.83 in the Rockies, and $1.70 in the Southwest. We are continuing to see compressed differentials in both the synthetic and WCS crudes due to the Canadian synthetic production interruption, coupled with apportionments on import lines from Canada. We are optimizing our crude slates to minimize these effects by increasing volumes of Permian Basin crudes that can be delivered to the El Dorado refinery via the Centurion and Osage pipelines.
First quarter consolidated refinery gross margin was $7.74 per barrel, a slight increase over the $7.59 recorded in the first quarter of 2016. In the MidCon and Southwest, our realized margin was impacted by our maintenance at our Tulsa, El Dorado, and Navajo refineries. In the Rockies, our realized margin was impacted by the temporary Salt Lake City pipeline outage. However, we were able to backfill a certain portion of our crude slate and capture the increase in product cracks. During the increase in our laid-in crude costs, improved operations at Woods Cross and Cheyenne helped us realize almost a $4 increase versus the prior quarter. Our RINs expense in the quarter was $66 million. We remain optimistic that flaws and inequities that are inherent with the mandate will be addressed by the present administration.
For the second quarter of 2017, we expect to run between 440,000 and 450,000 barrels a day of crude oil. With that, let me turn the call over to Rich.
Thanks, Tom. First quarter included several unusual items. Pre-tax earnings were negatively impacted by $15.6 million in acquisition-related charges, a $12 million lower cost or market charge, $10.2 million in charges attributable to the inventory value step-up at PCLI, and a $4.5 million charge for HollyFrontier's share of Holly Energy Partners' early extinguishment of debt. These charges were partially offset by a $24.5 million gain on foreign currency hedges related to the purchase of PCLI. As George mentioned, we have included a reconciliation of these items in our press release. PCLI's adjusted EBITDA over two months was $28 million. HollyFrontier realized a $10.2 million non-cash charge through PCLI's cost of goods sold for the step-up in inventory valuation associated with purchase accounting. We expect to realize a final $5 million of this non-cash step-up in the second quarter.
While it is early days, we are very pleased with the performance of PCLI and look forward to the opportunities to come. For the first quarter of 2017, cash flow consumed by operations was $39.4 million, including turnaround spending of $48 million. HollyFrontier's standalone CapEx totaled $49 million for the first quarter. For 2017, we expect to spend between $375 million and $425 million of standalone capital, including turnarounds. This is a decrease of $25 million compared to our original guidance. Additionally, we expect to spend $40 million of capital for HEP and $30 million for PCLI. As of March 31st, 2017, our total cash and marketable securities balance stood at $130 million. During the first quarter, we announced and paid a $0.33 regular dividend, putting our yield at 4.7% as of last night's close.
As of March 31st, we have $1 billion of standalone debt and no drawings under our $1.35 billion credit facility. This puts our liquidity at a very healthy $1.5 billion and debt to capital at a modest 18%. On Monday, HollyFrontier received an investment-grade rating of BBB- with a stable outlook from Fitch Ratings. We now hold investment-grade ratings from S&P, Moody's, and Fitch, which illustrates our strong balance sheet. HollyFrontier owns 36% of Holly Energy Partners, including the 2% general partner interest. HEP units continue to perform well, and the current market value of HollyFrontier's LP units is over $800 million. First quarter general partner distributions were $17.8 million, a 43% increase over the same quarter of 2016. As part of the lubricant primer posted today, we have published benchmark margins for Group I, Group II, and Group III base oils.
Going forward, we will publish these lubricant indicators monthly, along with the WTI-based 3-2-1 margins for each of our operating regions. These regional product and base oil indicators do not reflect actual sales data and are meant to show monthly trends. Realized gross margin per barrel may differ from indicators for a variety of reasons. You can find this data on the investor page at www.hollyfrontier.com. Finally, we'll be hosting an Analyst Day on the afternoon of December 7th at the New York Stock Exchange, where details will follow. With that, Sharon, we're ready to take questions.
The floor is now open for questions. At this time, if you have a question or comment, please press star one on your touch-tone phone. We ask that you please limit to one question and one follow-up. If you have additional questions, we welcome you to rejoin the queue. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. Thank you. Our first question is coming from Doug Leggate from Bank of America Merrill Lynch. Please go ahead.
Thanks. Good morning, everybody, and thanks for the additional detail on lubes. I think we all need a little bit of help with that. I've got two questions, if I may. My first one is on, obviously, capture rate was hit by maintenance and associated opportunity cost this quarter. But I'm trying to understand the impact of the RINs impact, the RINs cost. I wonder if you could walk us through the sequential change in costs. What I'm really trying to get at is, my understanding is you were kind of over-inventoried on RINs at the end of last year. Does that mean that you get a delayed impact from the reduction in RIN costs? In other words, will we see it show up a little more aggressively in subsequent quarters? I've got a follow-up, please.
Hey, Doug. It's Rich. The short answer is yes, you're correct. We did consume some RIN inventory during the quarter, and we use a weighted average cost of accounting for those RINs. We were all running RINs that are higher than market through the P&L during the first quarter. Long story short, yes, you're correct. We'll see a delayed benefit from the improvement RIN market.
Can you quantify the impact, Rich? Or the impact of the delay. In other words, if you were using spot RINs versus inventoried RINs, what would the difference be?
That'd be about a $15 million-$20 million difference.
Okay. That's really helpful. Thanks. I guess my follow-up is, I've got a number of things I wanted to ask, but I'll just keep it to two questions. I'll just go with PCLI. You've had it for a couple of months now, I guess. The run rate seems to be a little bit above the $150, the greater than $150 guidance you suggested for EBITDA. What are you seeing good and bad from as you integrate that business? Are you still comfortable with that guidance? What I'm really getting at is, it looks like there might be some upside to that guidance. I'll leave it there. Thanks.
Yeah, I wouldn't bake in that upside just yet, Doug. It's still very early, two months into this. To your original question regarding the good and the bad of what we're seeing from PCLI, it's all on the good side. The people we're getting have been very impressive. They've been very cooperative. It's basically, they feel like they've been unleashed and freed up to do a lot more creative thinking and doing than they have under prior ownership. That's a testament to them, and I think that's a testament also to the culture we have at HFC. Across the board, as far as both the base business and the potential upsides we see through synergies and feedstock optimization, all that is exactly as we expected, if not better, than when we walked in the door.
I appreciate that, guys. Rich, Craig, congrats again on getting your first quarter under your belt.
Thanks, sir.
Your next question comes from Blake Fernandez from Scotia Howard Weil. Your line is open.
Hey, guys. Good morning. I'll ask two questions, both on lubes. For one, I'm not as familiar with the volatility or seasonality of the market. I'm just curious, is 1Q typically a stronger or weaker period? In other words, is it fair to kind of extrapolate those two months across the year? Maybe I'll just ask both questions, and you can respond. The second question is on the synergies of $20 million through 2018. For one, I wanted to confirm that that is not part of your original $150 midpoint of EBITDA. Secondly, when you think we can maybe start to see some of that beginning to flow through and actually hit the EBITDA stream. Thanks.
Sure. I'll try to take those. As far as the seasonality or what February and March are indicators versus the full year, I would say that February and March are not necessarily the peak season. I think the peak is really coming more in the second quarter. There's not as much seasonality as perhaps our prepared remarks meant to imply here. It's more of a stable business. If you want to call one quarter more seasonal than the other, probably call it the second quarter, in preparation for driving season and warmer weather when people tend to change out their oil more. As far as the synergies, again, we're very early into this. We're just getting to know each other between our Tulsa and our PCLI lubricants businesses.
I think you can start to expect some of that to flow through late this year. Most of it will start coming in in 2018.
George, just to confirm, that is not part of the EBITDA 150 that you articulated when you kind of laid it out?
That's right. That's above the base expectation for the business, Blake.
Okay. Thanks, guys.
Sure.
Your next question comes from Paul Cheng from Barclays. Your line is open.
I think my first question is for Rich. Rich, on the roughly $23 million operating profit and EBITDA about $20, do you have a split between the base oil side, the manufacturing side, and what is the lubricant side, the wholesale or the marketing side? Also whether the result is pretty even between February or March, or one month is substantially better than the other.
Paul, on the first question, I think it's too early for us to get to that level of granularity. We'll work to that over the course of the year. As we've mentioned, we expect to have more disclosure over time here. On your second question, I think it's pretty evenly split, basically, between February and March. There was no major difference between the months.
Second question for, I think this is probably for George. George, is there any particular good reason that you want to keep the GP in the HEP instead of, say, maybe restructure and in exchange of a more maybe transparent vehicle in the LP, given that it's already in the high yield? Also, by doing so, that maybe we allow the HEP have a lower capital cost and perhaps that improve their competitive position in the market?
Okay. I think the answer to the first part of your question is regarding the GP. There's a simple one-word answer for that, and that's control. We want to keep the GP for very simple control reasons. I think your larger question is really intended at the cost of capital side. I think we've said previously, and we're still in the very early stages of pursuing this, Paul. We do want to look at the IDRs and see if there's some sort of deal that can be struck between HFC and HEP that's a win-win for both that basically lowers HEP's cost of capital as a result.
Do you have any kind of timeline in mind when you may make the decision?
We think we can get something scoped out this year. As you know, these things have a lot of tax details associated with them, and our people have been a little bit tied up with PCLI. Those are the ones that we need to really take the deep dive on the detailed issues here.
I'm sure Rich doesn't need to sleep, he will be able to work for you.
Rich is already growing fangs from being a vampire with no sleep.
Thank you.
Bottom line, though, Paul, we think we'll have something fleshed out either way by the end of the year.
All right. Thank you.
Your next question comes from Ed Westlake from Credit Suisse. Your line is open.
Yes, good morning. I guess two questions. One, you shouted out some improvements in the assets at Navajo and then Tulsa from the turnaround work that you did in the first quarter. I wonder if you can quantify the EBITDA uplift you think in a normal steady state that would come from those improvements. The second question's around the contracting of Bakken and WCS crude. Obviously, those diffs have tightened because of DAPL and Syncrude. That clearly would have a negative impact. I'm just wondering if there's anything you can do to mitigate or any color you can add to that. Appreciate any temporary.
Sure, Ed. I think we've given a little bit of a directional indication of what we think we can do with the projects at Navajo and at Tulsa. Again, directionally at Navajo, it's going to buy us a little bit more crude rate and make us more efficient in our downstream units by eliminating recycle streams that will basically get us a few thousand barrels per day more capacity in some of our downstream units like the DHT and NHT. I don't think we want to put an EBITDA dollar figure to those, Ed. I mean,
We can do that work. That's fine.
Okay. Same thing at Tulsa. Tulsa, the new catalyst gets us better yields and more octane capability. Again, assigning a specific EBITDA range or target to that is not something we'd like to do. On the crude supply side, as you said, Bakken and WCS have tightened up. I'll let Tom give you a little bit more feel and flavor for that.
Sure. Morning, Ed. Let's just talk about WCS first. As previously mentioned, what we did at the El Dorado refineries, we increased runs of what we call Permian sour blend that we can source in the Permian Basin and bring it over. Those, during the month of March, we got as high as 65,000 barrels a day of deliveries from Permian Basin, which was an all-time record for us. Then at Cheyenne
What we've seen in the Cheyenne market, we've seen very high asphalt prices this spring, that still allows us to run WCS at a good margin there. What we've done is we've trimmed back our coker, made more asphalt, and optimized profitability there. Bakken prices, we buy everything on a delivered basis at Cushing on Bakken. We saw some tightening towards the end of the quarter because of DAPL that we will readjust as we move forward and replace with other grades as per the LP.
Just a very quick one on lubes. The data pack you've put out has a bump in margins in March. Is that just the seasonality you're referring to for the 2Q peak, or is that just decline in oil prices and some stickiness on the base oil prices relative to oil? Just trying to get a sense of how these prices will move around.
I think that's more attributable to the seasonality.
Okay. Thank you.
Okay. Thank you.
Your next question comes from Phil Gresh from J.P. Morgan. Your line is open.
Hey, good morning. First question is just a follow-up on the RINs. I believe in the first quarter of last year, it was $46 million, and I know you mentioned the $15 million-$20 million difference using weighted average cost. I just want to get a sense of how you think the rest of the year would progress based on the current RINs price relative to what the full year cost was for last year.
Phil, look, we're going to shy. Given how absurd this market is, we can't even pretend to give you guidance on what RINs are going to do going forward.
Okay. Moving on to my next question then. For HFC, how are you thinking about the droppable EBITDA at this point to HEP, and do you anticipate this year potentially having any drops?
I think, Phil, we're not anticipating a drop-down in 2017. Obviously, we did an outsized drop-down with the Woods Cross processing units last year. We think we've probably got a little more runway in the drop-downs of processing units. Obviously, we've done all the traditional logistics in terms of pipes and tanks. Really what we'd like to do, and this gets to the IDR discussion, is we'd like to see HEP continue to grow externally, if you will. I think the other major area where we still have opportunities to leverage HFC for HEP's benefit is replacing other third-party service providers with HEP. Again, we spend about $1 billion a year moving things around at HFC. Not meaning to imply that all of that is addressable through this strategy, but there's still opportunities for us to give some of that business to HEP.
If I go back to the Analyst Day, I believe you had talked about $200 million of drop proceeds per year, and I know you had a larger one last year, so maybe nothing in the queue for this year, but I thought that there was more in the backlog, I guess.
Yeah. Phil, at the time, we mentioned that those were going to be lumpy. The 200 was not meant to be ratable by year, but it was the easiest way to portray the math. It's also somewhat related, obviously, the pace of projects and projects that fit the model, if you will, at HollyFrontier. Obviously, we've cut capital spending back a little bit. I think we'd expect that. Again, we've got some more runway there, but we wouldn't expect to do anything in 2017.
Sure. Okay. This last question, just on the CapEx. Can you remind us how much is the sustaining capital requirements underlying those numbers you gave, and just the turnaround piece of that, how much of that was for turnarounds, and whether you'd consider this a normal number or a higher than normal number?
I think our turnaround number this year is, call it $150-$165. That's higher than normal this year, just based on timing of maintenance. Sustaining capital on a run rate basis, call it about $100 million a year.
Okay, thanks.
Your next question comes from Roger Read from Wells Fargo. Your line is open.
Yeah, thanks. Good morning.
Morning, Roger.
Maybe following up a little bit on the PCLI piece here. You've obviously highlighted not a lot of volatility in the business, a little better March. Curious as you look forward, though, and maybe a little bit back from the time you acquired it on pricing and some of the moves in crude, because we had the big move in crude December and January. Has the business caught up with that move in crude, and so we're okay from this point, assuming no major price moves, or is there still more catch up to occur and that feeds into some of the guidance for the full year?
I think as you're hinting at, there's generally a lag between crude moves and lubricant price moves. To the extent that crude prices have moved up in the last few months, I think there's still some catch up to be done on the lubes price side.
Is there a rule of thumb you think we can use in that? I mean, 60, 90, 120 days, or
There really is no one number, but I would say somewhere between two to four months, so maybe 90 days on average.
Okay, great. Thanks.
Yep.
I'm sorry. Go ahead. I didn't mean to cut you off.
That's all right, Roger. It's just tough to give a specific guidance here because there's so many different products that are produced and so many different pricing relationships. We'll be able to provide more color as we get further into the details of the business as well.
Sure. Absolutely. Back to, I think it was Ed's question about EBITDA out of the refineries post some of these improvements. Maybe if you don't want to talk about EBITDA guidance, can you give us an idea of maybe Navajo, huge turnaround, as you said, expectations for either higher run rates or a higher level of utilization and maybe also with some of the other units here?
Yeah. At the highest level, again, I think we expect to get about 5,000 barrels per day more crude capacity at Navajo. We've typically run in the low 100,000, somewhere 103,000, 105,000 barrels per day. We hope to be pushing as high as 110,000 with the modifications that were made during this turnaround.
Thanks for that. I guess really, I was trying to get to maybe a reliability aspect. I know until you run it, you can't say for certain, but is there an expectation that reliability is improved here and at some of the other units, including Tulsa, following some of this work?
Yeah, I would say that Navajo has been one of our more solid performers from a reliability perspective. They can get locked into 105,000 for extended periods of time, and we look forward to getting them locked in at 110,000 for extended periods of time.
Okay, great. Thank you.
Thank you, Roger.
Your next question comes from Chi Chow from Tudor, Pickering, Holt. Your line is open.
Thank you. George, you mentioned that you've undertaken focused efforts to improve operations in the Rockies. Can you provide some specific details on those initiatives and what results have you seen so far?
We've dedicated a lot of our talent across our refining system. That's corporate resources from Dallas, as well as resources from our other refineries, especially our El Dorado refinery. Our thanks go to all those dedicated people that are spending time in Cheyenne, Wyoming versus with their families in the evenings to get this done. We've been at this since our last earnings call in earnest, and we're very encouraged by what we've seen. I can't remember the exact number, but from the fourth quarter of last year, we ran roughly in the mid-30s, and as Tom said in his prepared remarks in March, we ran 48,000 barrels per day. There's a lot of days where we're hitting 50,000 barrels per day, and that's where we need Cheyenne to be in that high 40s to 50,000 barrel per day range.
That builds up all the downstream units. We're looking at the downstream units, especially the DHT and the FCC, to get another 1,000 or 2,000 barrels per day more throughput to those units. It's a very focused effort. It's led by Tom Shinogle, who heads up our reliability group here corporately in Dallas. Kudos to Tom and many others that are making that sacrifice to get this done for us.
George, can you talk about operating costs in that region? Any sort of guidance going forward, what we can expect on OPEX?
Chi, I think we.
Look, we'd expect to see continued improvement to George's point, certainly on a per barrel basis. On a total, on an aggregate number, two things to highlight there. That should remain relatively stable at that point. Keep in mind that our Rockies OpEx includes the tariffs associated with the drop-down to HEP.
Yeah.
If you want to think about it, that's not true or clean operating cost. Look, we expect to see continuing improvements certainly on a per barrel basis as throughputs continue to rise.
As Rich is getting, our improvements are going to come more from the denominator, Chi, as we get the barrels up. We would like to get the Rockies to $7 per barrel, and that excludes-
The HEP tariff
HEP type of drop-downs that really we can't hang on our operating group. That's more of a corporate finance decision.
Great. Thanks. Then Rich, what was the working capital change in the quarter?
We did draw working capital, I want to say around, I don't have the number right in front of me, between $50 million and $100 million this quarter.
Okay. Is that something that reverses out here in Q2 or balance of the year?
Yeah. I would expect over the next couple quarters.
Most of it was driven by the Navajo turnaround. We stored up a lot of refined products so we could supply our customers during that time period. We also typically do a lot of time trades during that period, storing barrels early in the first quarter for subsequent sale in the second quarter.
Okay. Your cash balance was pretty low at quarter end. Do you have a more current cash balance figure? What sort of minimum cash levels are you comfortable with on running the business?
Order of magnitude, the cash balances remain basically the same. Obviously, there's a lot of volatility intra-month with timing of crude payments.
Generally speaking, look, our liquidity is very comfortable at a billion and a half dollars. I don't know that we necessarily think about it as a cash balance. It's more of a liquidity question than anything.
Okay, great. Thanks. Appreciate it, Rich.
Thanks to you.
Next question comes from Paul Cheng from Barclays. Your line is open.
Hey, guys. Two quick follow-ups. In terms of the RIN carryover from last year, Rich, by the end of the first quarter, should we assume that it's already over so that the second quarter forward that your RIN costs will be essentially based on the spot?
Yeah, Paul, I don't think we want to get into that detail because it starts getting into the commercial side of our business, and I don't think we want to tip our hand to the market there.
All right. That's fine. The second one is that with all the turnaround planned and unplanned, do you have any rough estimate that what's the opportunity cost associated with each one, the planned and the unplanned, including the loss of opportunities?
Yeah. I would probably put it in the $40 million range, Paul. That's excluding the large turnaround at Navajo, because we don't typically look at LPO associated with large planned turnarounds like that.
The $40 million is essentially for the unplanned downtime?
That's essentially for Tulsa and El Dorado. For the planned downtime at El Dorado for the vacuum tower and the unplanned outage at the Tulsa CCR.
Okay. Very good. Thank you.
At this time, I'll turn the call over to Craig Biery.
Thanks, everyone. We appreciate you taking the time to join us on today's call. If you have any follow-up questions, as always, reach out to investor relations. Otherwise, we look forward to sharing our second quarter results with you in August.
Thank you. This does conclude today's teleconference. Please disconnect your lines at this time and have a wonderful day.