PARR - Par Pacific Holdings, Inc. Comm

Par Pacific Holdings operates the Par Hawaii refinery (formerly Tesoro Hawaii) producing gasoline, diesel, and jet fuel, along with retail fuel stations and convenience stores under the 'Hele' and '76' brands in Hawaii. The company sells refined petroleum products to commercial and retail customers in Hawaii under a regional monopoly-like structure, with additional refining and logistics operations in Wyoming and Washington state. Par Pacific generates approximately $2B in annual revenue, with Hawaii as its dominant geographic market representing the majority of refining throughput and retail sales. The business model combines refining margins (crack spreads) with vertically integrated retail fuel distribution across roughly 90+ service stations in Hawaii.

Past Year Trends

• Par Pacific's Small Refinery Exemption (SRE) contributed $199.5 million in net income benefit in FY2025, reversing a net loss of $33.3 million in FY2024 to net income of $369.4 million ($7.16/share), with FY2025 Adjusted EBITDA reaching $633.5 million — a 165% increase year-over-year. (Bullish)
• The Wyoming refinery suffered an equipment malfunction in February 2025 that temporarily idled operations, but Par Pacific returned the facility to full capacity by late April 2025 — one month ahead of schedule — with Q1 2026 throughput recovering to 15 Mbpd versus only 6 Mbpd in Q1 2025. (Neutral)
• In July 2025, Par Pacific signed a definitive joint venture agreement with Mitsubishi Corporation and ENEOS Corporation, whereby the two partners acquired a combined 36.5% equity stake in the Hawaii Renewables project for $100 million cash, with Par Pacific retaining 64.5% operatorship of the 61-million-gallon-per-year renewable diesel and SAF facility. (Bullish)

Next Year Trends

• The Hawaii Renewables facility entered commissioning in Q4 2025 and is now ramping toward its full 61-million-gallon-per-year capacity for renewable diesel and sustainable aviation fuel (SAF), with Hawaiian Airlines and Alaska Airlines as offtake partners using locally grown camelina feedstock — successful ramp-up would add a new, structurally differentiated revenue stream to Par Pacific's refining business. (Bullish)
• As of March 31, 2026, the EPA had not made a determination on Par Pacific's Small Refinery Exemption for the 2025 RFS compliance year; if the SRE is denied or reduced, Par Pacific faces a potential EBITDA headwind of approximately $200 million based on the $199.5 million SRE benefit recognized in FY2025. (Bearish)
• The EPA finalized record-high Renewable Fuel Standard volume obligations of 25.82 billion RINs for 2026 and 25.98 billion RINs for 2027, along with a 70% reallocation of previously waived SRE volumes from 2023–2025, which increases Par Pacific's RFS compliance cost burden across its Hawaii, Montana, and Wyoming refineries absent new exemption relief. (Bearish)

Red Flags

No severe red flags identified as of August 2025.