Refining Segment
Our refining group operates a refinery in El Paso, Texas (the "El Paso refinery"),
a refinery near Gallup, New Mexico (the "Gallup refinery") and a refinery
in St. Paul Park, Minnesota (the "St. Paul Park refinery"). We supply
refined products to the El Paso area via WNRL and other logistics assets adjacent
to the El Paso refinery and to other areas including Tucson, Phoenix, Albuquerque
and Juarez, Mexico through third-party pipeline systems linked to our El Paso
refinery. We supply refined products to the Four Corners region and throughout
Northern New Mexico from WNRL operations in Albuquerque, Bloomfield and Gallup,
New Mexico. We supply refined products to the St. Paul Park area via WNRL and
through a third-party pipeline and terminal system that has facilities throughout
the Upper Great Plains region.
Our refining segment also includes our refined products marketing and distribution
operations in the Mid-Atlantic region. On September 15, 2016, we sold certain
assets consisting of terminals, transportation and storage assets and the related
land located at our St. Paul Park refinery and Cottage Grove tank farm to WNRL.
These assets primarily receive, store and distribute crude oil, feedstock and
refined products associated with the St. Paul Park refinery (the "St. Paul
Park Logistics Assets"). Prior to our sale of the St. Paul Park Logistics
Assets (the "St. Paul Park Logistics Transaction"), our refining segment
included the operations of the St. Paul Park Logistics Assets, and we have recast
historical financial and operational data of the refining segment, for all periods
presented, to reflect the sale of the St. Paul Park Logistics Assets to WNRL.
Retail Segment
Southwest Retail
Southwest Retail operates retail stores that sell various grades of gasoline,
diesel fuel and convenience store merchandise to the general public. Retail
also operates unmanned commercial fueling locations ("cardlocks")
that sell various grades of gasoline and diesel fuel to contract customers'
vehicle fleets. At December 31, 2016, Southwest Retail operated 259 retail stores
located in Arizona, Colorado, New Mexico and Texas and 51 cardlocks located
in Arizona, Colorado, New Mexico and Texas. We supply the majority of our retail
gasoline and diesel fuel inventories through WNRL and purchase general merchandise
as well as beverage and food products from various third-party suppliers.
The main competitive factors affecting Southwest Retail are the location of
the stores, brand identification and product price and quality. Our retail stores
compete with Alon USA Energy, ampm, Brewer Oil Company, Circle K, Maverik, Murphy
Oil, Quik-Trip, Shay Oil, Valero Energy Corporation and 7-2-11 food stores.
Large chains of retailers like Costco Wholesale Corp., Wal-Mart Stores, Inc.,
Kroger Company, Dollar General, Family Dollar and other large grocery retailers
compete in the motor fuel retail business. Our Southwest Retail operations are
substantially smaller than many of these competitors that are potentially better
able to withstand volatile conditions in the fuel market and lower profitability
in merchandise sales due to their size.