VALERO ENERGY CORP/TX (VLO)

Valero Energy Corporation is a multinational manufacturer and marketer of petroleum-based and low-carbon liquid transportation fuels and petrochemical products. It was incorporated in Delaware in 1981 as Valero Refining and Marketing Company and took its current name in 1997. Its common stock trades on the NYSE under the symbol "VLO," and its headquarters are at One Valero Way in San Antonio, Texas. The company's strategy is to be a low-cost, efficient and reliable supplier of liquid fuels, and it uses its refining expertise and marketing and distribution platform to support its low-carbon fuels businesses. It reports that it has invested $6.0 billion in those businesses.

Operations are managed through three reportable segments. The Refining segment covers 15 petroleum refineries in the U.S., Canada and the U.K., with combined throughput capacity of about 3.2 million barrels per day, plus the associated marketing and supporting logistics assets. The refineries produce gasoline (including California-specification blendstocks), diesel, jet fuel, asphalt, aromatics, heating oil and fuel oils. The company has approved a plan to idle the Benicia Refinery by the end of April 2026. The Renewable Diesel segment is DGD, a joint venture with Darling Ingredients that Valero consolidates. It operates two Gulf Coast plants with about 1.2 billion gallons per year of production capacity, producing renewable diesel and neat sustainable aviation fuel. A completed project at the Port Arthur plant allows about half of its 470 million gallon renewable diesel capacity to be upgraded to neat SAF. The Ethanol segment operates 12 plants in the U.S. Mid-Continent with about 1.7 billion gallons per year of capacity and markets ethanol and co-products. The company is also evaluating carbon capture and sequestration projects at certain ethanol plants.

Valero sells primarily in the U.S., Canada, the U.K., Ireland and Latin America. Refined products are sold in wholesale rack and bulk markets to wholesalers, distributors, retailers and truck-delivered end users. Most rack volume moves through unbranded channels. The rest goes to independently owned branded sites supplied under multi-year contracts, and about 7,000 outlets carry its brands. Those brands are Valero, Beacon, Diamond Shamrock and Shamrock in the U.S., Ultramar in Canada, Valero and Texaco in the U.K. and Ireland, and Valero in Mexico. Demand for its low-carbon fuels is supported by government programs, including the U.S. Renewable Fuel Standard, California's Low Carbon Fuel Standard, Canada's Clean Fuel Regulations and the U.K. Renewable Transport Fuel Obligation. These programs also impose compliance costs on the refining business, and U.S. clean fuel production tax credits apply to qualifying fuels.

Crude oil and other feedstocks are bought under term and spot contracts from national oil companies and international and U.S. oil companies. Term contracts are at market-related prices, mostly at the producer's official stated price. Refineries receive feedstocks and ship products through marine docks, pipelines, rail, truck and barge, and connect to common-carrier pipelines such as Colonial and Explorer. The company also owns logistics assets including the Parkway and Bengal pipelines, the Mainline Pipeline in the U.K., and terminals in Canada. Its operations are supported by proprietary management systems for operational excellence, environmental risk assessment and fuels regulatory compliance.