Holly Energy Partners LP

Holly Energy Partners LP — Investor Presentation (March 2022)

12 slides from Holly Energy Partners LP's investor presentation, Mar 22, 2022

  1. Slide 1: Disclosure Statement

    1 Disclosure Statement Statements made during the course of this presentation that are not historical facts are “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “project,” “will”, “expect,” “plan,” “goal,” “fore

  2. Slide 2: Holly Energy Partners (HEP) Company Profile

    2 Holly Energy Partners (HEP) Company Profile STABLE EARNINGS FINANCIAL TARGETS & GUIDANCE BALANCE SHEET HIGHLIGHTS  Revenues are nearly 100% fee-based with de minimis commodity risk  Customer base consisting of refining companies (contracts not with E&Ps)  Minimum Volume Commitments (MVCs) compr

  3. Slide 3: HEP Assets

    3 HEP Assets Holly Energy Partners owns and operates substantially all of the refined product pipeline and terminalling assets that support HF Sinclair’s refining and marketing operations in the Mid- Continent, Southwest and Northwest regions of the United States  Approximately 4,400 miles of crude

  4. Slide 4: HEP Ownership Structure

    4 HEP Ownership Structure 99.999% interest 66,810,171 HEP units1,2 53% LP interest1 $1,114mm Value3 59,630,030 HEP units1 47% LP interest1 $988mm Value3 HF SINCLAIR CORPORATION (HF Sinclair) GENERAL PARTNER (GP) HOLLY LOGISTIC SERVICES L.L.C. HOLLY ENERGY PARTNERS, L.P. (HEP) PUBLIC Non-economic GP

  5. Slide 5: HEP Avenues for Growth

    5 HEP Avenues for Growth ORGANIC EXTERNAL TRANSACTIONS DROPDOWNS FROM HF SINCLAIR  Leverage HEP’s existing footprint to capitalize on commercial opportunities  Contractual PPI/FERC escalators  Replace incumbent HF Sinclair service providers with HEP Example: Frontier Pipeline Expansion  Pursue l

  6. Slide 6: Sinclair Acquisition Highlights

    6 Sinclair Acquisition Highlights Expansive Network of Crude and Products Assets in Key Demand Centers Pipelines  1,200 miles of pipelines  Regional crude gathering system for Sinclair’s refineries and 3rd parties  Refined product outlets for Sinclair’s refineries Terminals  8 product terminals

  7. Slide 7: HEP Pro Forma Earnings Profile

    7 HEP Pro Forma Earnings Profile1  Expected $70-80 million of adjusted EBITDA uplift from Sinclair’s midstream assets  Amount differs from historical results, reflecting new minimum volume commitments to be entered into between HEP and HF Sinclair, expected growth in JV earnings, and the exclusion

  8. Slide 8: HEP Capital Allocation Strategy

    8 HEP Capital Allocation Strategy1 Near-term  Continue to reduce leverage  Pay sustainable quarterly distribution of $0.35/unit Mid to Long-term Strategy  Focus on funding all capex and distributions within operating cash flow  Reduce leverage to 3.0x-3.5x  Maintain distributable cash flow cove

  9. Slide 9: Appendix

    APPENDIX AHF Sinclar

  10. Slide 10: Sinclair Transaction Overview

    Sinclair Transaction Overview Creating a More Diverse, Downward Integrated Business with Scale 10 HollyFrontier Transaction Structure & Purchase Price  All-stock transaction, with a transaction value of ~$2.1 billion based on HFC closing stock price on March 11, 2022  Includes the creation of a ne

  11. Slide 11: HEP Adjusted EBITDA Reconciliation

    HEP Adjusted EBITDA Reconciliation 11 Holly Energy Partners HEP HEP PF Sinclair 12/31/2021 12/31/2021 Net income attributable to the partners 214,946$ 218,727$ + Interest expense 53,818 76,055 - Interest income (29,925) (29,925) + State income tax expense 32 32 + Depreciation and amortization 93,800

  12. Slide 12: Definitions

    Definitions 12 BPD: the number of barrels per calendar day of crude oil or petroleum products. Blenders Tax Credit (BTC): Federal tax credit where qualified biodiesel blenders are eligible for an income tax credit of $1.00 per gallon of biodiesel or renewable diesel that is blended with petroleum di

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