Slide 1: HollyFrontier Investor Presentation March 2021
HOLLYFRONTIER INVESTOR PRESENTATION March 2021
Slide 2: Disclosure Statement
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,” “expect,” “plan,” “goal,” “forecast,” “in
Slide 3: Executive Summary: Positioned for Value Creation Across all Segments
Executive Summary Positioned for Value Creation Across all Segments 3 MIDSTREAM SPECIALTY LUBRICANTSREFINING RENEWABLES Inland merchant refiner 4 refineries in the Mid- Continent and West regions Flexible refining system with fleet wide discount to WTI Premium niche product markets versus Gu
Slide 4: HollyFrontier Asset Footprint
HollyFrontier Asset Footprint 4 Expected 2Q21
Slide 5: Proximity to North American Crude Production Laid in Crude Advantage
5 Proximity to North American Crude Production Laid in Crude Advantage 1. Data from quarterly earnings calls. 2. Reflects removal of Cheyenne Refinery data due to conversion of Cheyenne to Renewable Diesel Facility in 3Q 2020. Beneficiary of inland coastal crude discount across entire refining sys
Slide 6: High Value Premium Product Markets
6 1. Gulf Coast: CBOB Unleaded 84 Octane Spot Price, Group 3: Unleaded 84 Octane Spot Price, Chicago: Unleaded CBOB 84 Octane Spot Price, Denver: CBOB 81.5 Octane Rack Price, Phoenix: CBG 84 Octane Rack Price, SLC: CBOB 81.5 Octane Rack Price, Las Vegas: CBOB 84 Octane Rack Price. Source: GlobalView
Slide 7: Refining Segment Earnings Power
7 Refining Segment Earnings Power $20.06 $13.86 $18.41 $19.88 $20.58 $11.83 $10 $15 $20 2015 2016 2017 2018 2019 2020 Mid-Cycle Refining EBITDA Gulf Coast 3-2-1 Crack $10.00 Brent/WTI Spread $4.00 Product Transportation to HFC Markets $3.00 HFC Index $17.00 Capture Rate 75% Realized Gross Margin Per
Slide 8: HollyFrontier Renewables Strategic Rationale
8 HollyFrontier Renewables Strategic Rationale Plan to expand the renewables segment to become a meaningful part of HollyFrontier’s cash flow and diversify from traditional petroleum fuels refining Consumer preference for low carbon fuels continues to grow, driving expansion of government renewa
Slide 9: HollyFrontier Renewable Diesel
9 HollyFrontier Renewable Diesel HollyFrontier is expected to produce over 200 million gallons per year of renewable diesel Renewable Diesel Defined Renewable diesel is a cleaner burning fuel with over 50% lower greenhouse (GHG) emissions than conventional diesel Renewable diesel is not biodiese
Slide 10: Artesia Renewable Diesel Unit
10 Artesia Renewable Diesel Unit 10 Expected capacity to produce ~120 million gallons per year of renewable diesel Project Details HFC to construct greenfield Renewable Diesel Unit (RDU) co-located at the Navajo refinery Includes rail infrastructure and storage tanks Existing hydrogen and util
Slide 11: Cheyenne Renewable Diesel Unit
11 Cheyenne Renewable Diesel Unit * Blenders tax credit Expected capacity to produce ~90 million gallons per year of renewable diesel Project Details HFC to convert existing hardware to produce renewable diesel Ceased crude refining operations in early August 2020 Utilizing existing infrastruc
Slide 12: Pre-Treatment Unit Feedstock Flexibility
12 Pre-Treatment Unit Feedstock Flexibility Pre-treatment capacity allows our renewable diesel plants to process a variety of feedstock Project Details HFC to construct pre-treatment unit to provide flexibility and upgrade of feedstock Designed to treat degummed “unrefined” soybean oil, bleachab
Slide 13: Holly Energy Partners Business Profile
13 Operate a system of petroleum product and crude pipelines, storage tanks, distribution terminals and loading rack facilities located near HFC’s refining assets in high growth markets Revenues are nearly 100% fee-based with de minimis commodity risk Customer base consisting of refining compani
Slide 14: Ownership Structure: Eliminated IDRs in 2017 to Simplify Structure
14 1. Unit Count as of December 31, 2021. 2. Based on HEP unit closing price on February 25, 2021. 14 100% Interest 45.3mm HEP units1 43% LP Interest $786M Value2 60.1mm HEP units1 57% LP Interest $1,042M Value2 HOLLYFRONTIER CORPORATION (HFC) GENERAL PARTNER (GP) HOLLY LOGISTIC SERVICES, L.L.C. HOL
Slide 15: HEP history and growth timeline
15 2004 2005 2006 2007 2008 2009 MLP IPO (July 2004) Holly intermediate feedstock pipeline dropdown (July 2005) 25% JV with Plains for SLC pipeline (Mar 2009) Holly Tulsa dropdown of loading rack (Tulsa West) (Aug 2009) Holly crude oil and tankage assets dropdown (Feb 2008) Alon pipeline and termina
Slide 16: HEP Avenues for Growth
16 HEP Avenues for Growth ORGANIC EXTERNAL TRANSACTIONS DROPDOWNS FROM HFC Leverage HEP’s existing footprint Contractual PPI/FERC Escalators Replace incumbent HFC service providers with HEP Pursue logistics assets in HEP’s current geographic region Replace incumbent HFC service providers w
Slide 17: Cushing Connect Joint Venture Deal Highlights
17 Deal Highlights JV estimated total capital of $130 million with expected initial EBITDA1 multiple of 8x-9x. HEP to build and operate pipeline, PAA to build terminal connections and operate terminal HFC entered into 15 year minimum volume commitment of 100 KBPD with HEP, which will commence upon c
Slide 18: HF Lubricants & Specialty Products Integrated Model from Crude to Finished Products
18 Mississauga Base Oil Plant Base Oil Production Blending & Packaging RACK BACK MarketingDistribution R&D RACK FORWARD VGO/HCB HF Lubricants & Specialty Products Integrated Model from Crude to Finished Products Base Oil White Oils Specialty Products Waxes Finished Lubricants & Greases • Rack Back c
Slide 19: HF Lubricants & Specialty Products Global End Markets
19 HF Lubricants & Specialty Products Our Product Portfolio Serves a Variety of Global End Markets Adhesives Agriculture Construction Automotive Packaging Food & Beverage Forestry & Saw Mill Energy Manufacturing Health & Beauty Heavy Duty Mining Transportation Pharmaceutical Plastic Processors Railr
Slide 20: HF Lubricants & Specialty Products Diverse Suite of Products
20 Brands Product Type • Finished Lubricants & Greases • Specialty Products • Waxes • White Oils • Base Oils • Finished Lubricants & Greases • Waxes • White Oils • Petrolatums • Specialty Products • Finished Products & Greases • Specialty Products • Waxes • Base Oils Customer Base • Consumer Discret
Slide 21: 2020 Product Slate by Volume
21 2020 Product Slate by Volume Finished Lubricants & Greases Petrolatums Waxes White Oils Specialty Products Base Oils Margin Value $/bbl Converting one barrel of Base Oil sales into Finished Product sales results in an average margin uplift of ~$50/bbl Opportunity Across the Value Chain Upgrade Ex
Slide 22: Rack Forward Adjusted EBITDA Margin Stability
22 30 58 58 55 53 40 48 47 56 52 57 49 52 64 51 61 77 23 79 48 9% 16% 16% 16% 14% 10% 13% 13% 14% 12% 13% 12% 12% 13% 11% 13% 16% 7% 19% 11% 0% 5% 10% 15% 20% $0 $20 $40 $60 $80 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Adjusted EBITDA Adjust
Slide 23: Rack Forward Multiple Up-Lift
23 Rack Forward Multiple Up-Lift Segment(s) Multiple Margin Profile Peer Group Refining & Rack Back 5-7x Variable Integrateds: BP, CVX, RDS, XOM Refiners: CLMT, CVI, DK, MPC, PBF, PSX, VLO MLP 6-9x Stable DKL, MPLX, PBFX, PSXP Note: Multiple represents range of EV/EBITDA multiples for referenced pee
Slide 24: Mid-Cycle Rack Forward Adjusted EBITDA
24 Mid-Cycle Rack Forward Adjusted EBITDA ($ in millions) $265 Target Multiple 11x Enterprise Value ($ in millions) $2,915 Mid-Cycle Rack Forward EBITDA RF EBITDA Margin 11-16% Annual SG&A $190 - $200MM Annual DD&A $80 - $90MM Upside with Organic Growth and M&A Opportunities 11x multiple in-
Slide 25: Environmental, Social, and Governance (ESG)
25 Environmental, Social, and Governance (ESG) Board leadership provides significant industry expertise, alongside diverse business, financial and EHS expertise • Environmental, Health, Safety, and Public Policy Committee at Board level • 10 of 11 directors independent, including chair • 2 female bo
Slide 26: Appendix
A P P E N D I X
Slide 27: Capital Allocation Strategy
27 Capital Allocation Strategy New Growth Opportunity and Shareholder Return Initiatives Reinvest & Maintain our Existing Assets Promote safe and reliable operations Maintain a Healthy Balance Sheet & Investment Grade Credit Profile Target ~$500 million minimum cash balance Investment grade ra
Slide 28: Capital Allocation Strategy: Disciplined Approach
Capital Allocation Strategy Disciplined Approach to Capital Allocation to Create Shareholder Value Investment Grade Rating ● Target $500 million Cash ● $2.7 billion Current Liquidity2 C a s h F ro m O p e ra ti o n s $375mm Capital Investments1: Sustaining Maintenance Turnarounds $225mm Regular Divi
Slide 29: 2021 Capex Guidance
2021 Capex Guidance Refining - $190 – $220 million Lubricants & Specialties - $40 – $50 million Renewables - $520 – $550 million Turnarounds & Catalysts - $320 – $350 million HEP - $49 – $61 million Refining 17% Lubricants & Specialties 6% Renewables 46% Turnarounds & Catalysts 29% HEP 5%
Slide 30: Strong Track Record of Cash Returns
Strong Track Record of Cash Returns 30 • Strong track record in returning excess cash to shareholders • Committed to maintaining competitive cash yield versus peers • Share repurchase program funded by Free Cash Flow generation 1. Share price as of February 25, 2021 closing prices. 2. Total Cash yie
Slide 31: HollyFrontier Capital Structure
HollyFrontier Capital Structure 31 Investment Grade Rating from S&P (BBB-), Moody’s (Baa3), and Fitch (BBB-) Cash and Short Term Marketable Securities $1,368 HOLLYFRONTIER CORPORATION HFC Credit Agreement (matures 2/2022) $- HFC 2.625% Senior Notes due 2023 $350 HFC 5.875% Senior Notes due 2026 $1,0
Slide 32: HollyFrontier Credit Profile
Investment Grade Rating - S&P BBB- - Moody’s Baa3 - Fitch BBB- $1.4 billion cash as of 12/31/20 $1.75 billion outstanding debt as of 12/31/20 - excludes non-recourse HEP debt Total debt to capital ratio 25% as of 12/31/20 Target 1x Net Debt/EBITDA (ex HEP) • Debt to Capital is calculated b
Slide 33: Definitions
Definitions Internal Rate of Return (IRR): a metric used in capital budgeting to estimate the profitability of potential investments. The internal rate of return is a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. Includes management’s
Slide 34: HollyFrontier Index
Please see p. 35 for disclaimer and www.HollyFrontier.com/investor-relations for most current version. HollyFrontier Index 34 34
Slide 35: HFC Index Disclosure
HFC Index Disclosure 35 HFC's actual pricing and margins may differ from benchmark indicators due to many factors. For example: • Crude Slate differences – HFC runs a wide variety of crude oils across its refining system and crude slate may vary quarter to quarter. • Product Yield differences – HFC’
Slide 36: HollyFrontier Corporation Contact Information
HollyFrontier Corporation (NYSE: HFC) 2828 N. Harwood, Suite 1300 Dallas, Texas 75201 (214) 954-6510 www.hollyfrontier.com Craig Biery | Vice President, Investor Relations investors@hollyfrontier.com 214-954-6510 Trey Schonter | Investor Relations investors@hollyfrontier.com 214-954-6510