Par Pacific Holdings, Inc. (Houston) announced that it has signed a definitive agreement to acquire the 63,000-bbl/d Billings refinery and associated marketing and logistics assets (collectively, the Billings Assets) from ExxonMobil Corp. (Houston) and two of its subsidiaries for a base purchase price of $310 million, plus hydrocarbon and other inventory to be valued at closing. Par Pacific expects to fund the acquisition with cash on hand and availability under existing credit facilities, based on liquidity of approximately $495 million on September 30, 2022. Hydrocarbon inventory is expected to be financed by a new working capital facility. The transaction is expected to be immediately accretive to Adjusted Net Income and Free Cash Flow per share and is expected to close in the second quarter of 2023, subject to customary closing conditions.
“This acquisition will significantly enhance our scale and geographic diversification and underpins our focus on pursing strategic growth initiatives,” said William Pate, President and Chief Executive Officer of Par Pacific. “We look forward to welcoming the dedicated and highly skilled Billings employees to our team. This acquisition expands our fully integrated downstream network in the western United States.”
The 63,000 bpd Billings refinery is a high-conversion, complex refinery, which processes low-cost Western Canadian and regional Rocky Mountain crude oil grades. Par Pacific is evaluating renewable fuels opportunities to supplement the refinery’s conventional fuel production and utilize its existing market position in Washington to reduce the carbon intensity of its fuel sales in accordance with the recently enacted Washington low-carbon fuel standard.
In addition to the refining assets, the transaction includes a 65% interest in an adjacent cogeneration facility and an expansive PADD IV & V marketing and logistics network. The logistics assets include the wholly-owned 70-mile, 55,000 bpd Silvertip Pipeline, a 40% interest in the 750-mile, 65,000 bpd Yellowstone refined products pipeline, and seven refined product terminals. Total storage capacity across the refinery and logistics locations totals 4.1 MMbbls. The acquisition also includes a long-term ExxonMobil-branded fuels marketing arrangement to supply approximately 300 retail locations.