20192019 CITIZENSHIP REPORT HollyFrontier Corporation (HollyFrontier), headquartered in Dallas,...

CITIZENSHIP REPORT

2019

2019

CEO MESSAGE

ABOUT US

SAFETY

ENVIRONMENTAL PERFORMANCE

OUR PEOPLE

COMMUNITY INVOLVEMENT

CORPORATE GOVERNANCE

APPENDIX

01

03

09

15

25

31

39

43

At HollyFrontier, we’re proud of what we do and how we do it. Our products provide people with the mobility and tools to live dynamic lives.

In 2019, HollyFrontier continued our pursuit of excellence in both business results and corporate citizenship. We recognize that our company’s success is always tied to integrity in doing right by our people, neighbors and environment. We remain committed to delivering value to our stakeholders, even through periods of commodity price volatility and economic uncertainty, and to the long-term success of our business and communities.

Our 2019 HollyFrontier Citizenship Report highlights some of the strides we’ve made together for our safety, our employees, the environment, the communities where we live and work, and our economy.

HOLLYFRONTIER CORPORATION

A LETTER TO OUR STAKEHOLDERS

01

CEO MESSAGE

MICHAEL C. JENNINGSChief Executive Officer and President

2019 HIGHLIGHTS INCLUDE:

Safety. Safety continues to be one of our top priorities across all our operations. We achieved strong safety performance in 2019, with a 24% reduction in employee injury rates and a 23% reduction in Tier 1 and 2 process safety incident rates year over year.

Employees. Our people are what differentiates us from our peers. We are grateful our employees have chosen HollyFrontier and we seek to foster a culture of safety, integrity, teamwork and ownership so they can thrive here. We employed 4,087 people in 2019 and invested more than $4 million in professional development programs to support their growth.

Environment. Our industry can be cleaner and more sustainable as we go forward. That’s why we seek to reduce our environmental footprint, and improve emission control technology and waste reduction strategies when undertaking facility upgrades.

Regulatory requirements and consumer demand for cleaner fuels offer us an opportunity to produce lower-emission products. And, in November 2019, we announced a $350 million investment in renewable diesel production at our Navajo refinery in Artesia, New Mexico.

Community. We are committed to helping strengthen the communities where we live and work. In 2019, we contributed more than $2 million to our communities. Our employees continued to volunteer with organizations that focus on helping our neighbors, that keep our communities safe and that share our dedication to being better stewards of the environment.

Economy. We positively impact our local economies through job creation, taxes, revenues, capital improvements and community investments. In 2019, we dedicated $500 million of capital spend to sustaining, growing and enhancing our manufacturing facilities.

While our company made great strides in 2019, the business environment has changed considerably in 2020 due to COVID-19. The health and safety of our employees, communities and contractors has been our top priority as we navigate this challenging environment. We implemented precautionary measures to protect our workforce so that we could continue to safely operate our facilities. Through this uncertain period, our values of safety, integrity, teamwork and ownership will continue to provide the basis for how we think and behave. Thank you for walking alongside us as we navigate through the coming year. On behalf of our board of directors and our employees, we appreciate your support.

Michael C. Jennings Chief Executive Officer and President

2019 CITIZENSHIP REPORT02

CEO MESSAGE

ABOUT US

2019 CITIZENSHIP REPORT

HFLSP LUBRICANTS FACILITY

HEP TERMINAL/HFC PRODUCT MARKETS

HFC REFINERY + LUBRICANTS PRODUCTION

HFC REFINERIES

HFC PRODUCTMARKETS

CRUDE HUB

CRUDE GATHERING



HEP PRODUCTPIPELINES

HEP CRUDEPIPELINES

HFC REFINERY + LUBE PRODUCTION

HFC REFINERIES

PADD 1

Cushing

ROADRUNNER

CENTURIONN

SLC/FRONTIER

UNEV PIPELINE

PADD 5

PADD 4

PADD 2

PADD 3

�

Las Vegas

Phoenix

Tucson

Sioux Falls

Fargo

Boise

Spokane

Mountain Home

Omaha

Topeka

St Louis

Bloom� eld

Albuquerque

GuernseyCasper

Sidney Chicago

Minneapolis

Des Moines

Kansas CityCedar City

Moriarty

Denver

Council Bluffs

Petrolia

Spring� eld

Little Rock

Oklahoma City

Abilene

Wichita Falls

Duncan

Rogers

El PasoMidland

OrlaBig Spring

Catoosa

JoshuaMidland

Osage

OrlaAmsterdam

TULSA

SALT LAKE CITYCHEYENNE

ARTESIA

Mississauga

BELGIUM GERMANY

UKHQ

EL DORADO

SONNEBORN

NETHERLANDS

04

ABOUT US


HFC PRODUCT MARKETS

CRUDE HUB

CRUDE GATHERING

HEP PRODUCT PIPELINES

HEP CRUDE PIPELINES

U.S. INLAND REFINERIES

BARRELS OF CRUDE & PRODUCT STORAGE

MARKET LUBRICANTS AND SPECIALTY PRODUCTS IN MORE THAN COUNTRIES

GALLONS/DAY OF GASOLINE PRODUCED

BARRELS/DAY REFINING CAPACITY

PIPELINE MILES

BARRELS/DAY OF LUBRICANT AND SPECIALTY PRODUCTS PROCESSING CAPACITY

THIRD-PARTY OPERATED TERMINALS WORLDWIDE

LARGEST NORTH AMERICAN BASE OIL PRODUCER

5

15M

80

10M

79 LOADING RACKS

TERMINALS

457K

~3.4K

34K

30 5TH

REFINING

MIDSTREAM

LUBRICANTS AND SPECIALTY PRODUCTS

HFC PRODUCTMARKETS

CRUDE HUB

CRUDE GATHERING



HEP PRODUCTPIPELINES

HEP CRUDEPIPELINES

HFC REFINERY + LUBE PRODUCTION

HFC REFINERIES

PADD 1

Cushing

ROADRUNNER

CENTURIONN

SLC/FRONTIER

UNEV PIPELINE

PADD 5

PADD 4

PADD 2

PADD 3

�

Las Vegas

Phoenix

Tucson

Sioux Falls

Fargo

Boise

Spokane

Mountain Home

Omaha

Topeka

St Louis

Bloom� eld

Albuquerque

GuernseyCasper

Sidney Chicago

Minneapolis

Des Moines

Kansas CityCedar City

Moriarty

Denver

Council Bluffs

Petrolia

Spring� eld

Little Rock

Oklahoma City

Abilene

Wichita Falls

Duncan

Rogers

El PasoMidland

OrlaBig Spring

Catoosa

JoshuaMidland

Osage

OrlaAmsterdam

TULSA

SALT LAKE CITYCHEYENNE

ARTESIA

Mississauga

BELGIUM GERMANY

UKHQ

EL DORADO

SONNEBORN

NETHERLANDS

05


HollyFrontier Corporation (HollyFrontier), headquartered in Dallas, Texas, is an independent petroleum refiner and marketer that produces high value light products such as gasoline, diesel fuel, jet fuel and other specialty products.

Through our refining segment, we own and operate refineries located in Kansas, Oklahoma, New Mexico, Wyoming and Utah and market refined products principally in the Southwest U.S. and the Rocky Mountains extending into the Pacific Northwest and in other neighboring Plains States.

Our midstream segment is owned and operated through Holly Energy Partners, L.P. (HEP). HollyFrontier also owns a 57% limited partner interest and a non-economic general partner interest in HEP. HEP owns and operates substantially all of the refined product pipeline and terminalling assets that support our refining operations in the Mid-Continent, Southwest and Rocky Mountain Regions of the United States.

Our lubricants and specialty products segment (HFLSP) produces base oils and other specialized lubricants in the United States, Canada and the Netherlands, exporting products to more than 80 countries worldwide. In addition to specialty lubricant products produced at our Tulsa Refinery, HFLSP includes the operations of Petro-Canada Lubricants, Red Giant Oil and Sonneborn.

For more information about HollyFrontier and our financial performance, please see the 2019 HollyFrontier Annual Report on our corporate website, hollyfrontier.com.

COMPANY PROFILE

06

ABOUT US


Transportation Fuel

Hydraulic Oils

Roofing Shingles

Engine Oils

Food & Beverage

Locomotive Engine Oils

Pharmaceutical Products

Health & Beauty Sticky Notes

08

HOLLYFRONTIER PRODUCTS ARE IN MANY COMMON ITEMS, SUCH AS:

ABOUT US

SAFETY

OVERVIEW

We are dedicated to our “Goal Zero” vision and to making sure everyone working within our facilities returns home safely, every day. We do this by embedding our commitment to safety throughout our organization, from frontline employees and contractors to our executive leadership and board of directors. We aim to be an industry leader in safety and to reinforce those goals by actively engaging our employees to achieve our safety targets. Safety and reliability are fundamental to our operational success and to our commitment to the well-being of our workforce, communities and the environment.

OUR APPROACH TO SAFETY MANAGEMENT AND OVERSIGHT

Our Environment, Health and Safety (EHS) policy sets forth our commitments to workplace and process safety and emergency preparedness. The EHS policy is available on our company website. Our Operational Excellence Management System (OEMS) provides the framework through which we identify, monitor and reduce risks. Our EHS Leadership Council, composed of company executives including our CEO, business unit leaders and corporate safety specialists, meets quarterly to set EHS strategy and review performance. The Environmental, Health, Safety, and Public Policy Committee of the board of directors provides board-level oversight.

We continuously seek to improve safety performance through strong leadership and employee engagement. Anchored by our OEMS management system, our integrated programs promote consistent application with shared safety goals in mind. This systematic framework includes a formal process for identifying, quantifying and managing operational risk. It helps us maintain effective people, plants and processes. Key elements include:

1 A multi-layer approach to setting and monitoring safety goals. We drive toward achieving “Goal Zero” which embodies our belief that safe production can be achieved each and every day. We reinforce this with a specific worker injury rate goal set to make HollyFrontier better than the industry average – for 2020 we target a total recordable incident rate (TRIR) of less than 0.51 for employees and less than 0.34 for contractors.

2 Rigorous and regular safety training. We promote understanding and adherence to our Life-Saving Principles, Hazard Identification, Emergency Preparedness and regulatory requirements through ongoing education and training efforts. In addition to mandatory new-hire safety training, all employees and contractors must undergo at least annual workplace and process safety training. Each site designates certain safety-critical topics for in-person training as part of its training program.

3 Contractor safety requirements. All safety policies and programs apply equally to contractors. In addition, we seek to improve and sustain contractor safety performance through actions including in-depth selection criteria, contractual requirements to comply with our safety requirements, third-party evaluation and scoring of contractor safety, minimum safety training requirements and participation in local contractor safety councils.

4 Defining safe work procedures. Controls and safeguards are implemented to guide the safe execution of work. Sites must have a process in place to inspect the facility to identify, record and track mitigations for hazards identified. Safe work procedures for critical tasks are provided, offering clear expectations and requirements that must be met to perform the work safely.

5 Emergency management and response planning. Emergency Management and Response Plans and Processes are defined at the corporate and facility level. Employees are trained to perform their responsibilities, emphasizing the hierarchy of protection of people, the environment and property. Drills are conducted at least annually for experience, critique and continuous improvement.


SAFETY

https://s2.q4cdn.com/255514451/files/doc_downloads/2020/05/010-EHS-Policy.pdf

Our EHS Leadership Council provides executive-level safety management. Our Environmental, Health, Safety, and Public Policy Committee provides board-level oversight.

OUR 2020 CONTRACTOR TOTAL RECORDABLE INCIDENT RATE GOAL

<0.34

OUR 2020 EMPLOYEE TOTAL RECORDABLE INCIDENT RATE GOAL

<0.51

SAFETY PERFORMANCE

PROCESS SAFETY We strive to prevent incidents with effective process safety management. Process safety incidents are unplanned or uncontrolled releases of hazardous materials, measured as Tier 1 for the most serious type of incidents and Tier 2 for lesser loss of containment events.

We are a member of American Fuel & Petrochemical Manufacturers (AFPM) and partner of American Petroleum Institute (API). Through our involvement in both groups, we continuously explore opportunities to enhance safety, improve process safety performance throughout the industry and learn from each other. We chair and participate in several AFPM committees.

We participate in the AFPM and API’s “Advancing Process Safety” program, which includes a site assessment component.

per 200,000 hours worked

Employees

Contractors

Combined Rate

# of fatalities

Employees

Contractors

*PCLI data included beginning 2017; Sonneborn and Red Giant Oil data included beginning 2019

PERFORMANCE MANAGEMENT THROUGH USE OF TIER 3 AND TIER 4 METRICS

We utilize an EHS Data Management Platform to allow for employee and contractor reporting of unintended operational, process or occupational safety events. All of these events are reviewed by subject matter experts to determine the need for additional investigation or corrective action. The EHS data management system is utilized to track and report Tier 3 metrics, which include any challenges to safety systems. Additionally, Tier 4 metrics, or leading indicators, are used to monitor the health of various programs including management of change, pre-startup safety review, work permitting and action item closure.

WORKER FATALITY INCIDENT DATA

OSHA TOTAL RECORDABLE INCIDENT RATE

2016 2017 2018 2019

2016 2017 2018 2019

0

0.8

5

0.5

7 0.6

7

0.5

1

0.2

6 0.4

0

0.7

0

0.7

5

00 01

0 0 0

0.5

6

0.5

0

0.6

8

0.6

1

per 200,000 hours worked

Tier 1 Incident Rate Tier 2 Incident Rate

Tier 1 Incident Count Tier 2 Incident Count

PROCESS SAFETY INCIDENTS

*PCLI data included beginning 2017; Sonneborn and Red Giant Oil are not included

2016 2017 2018 2019

.08 0.1

6

0.1

5

0.1

44

8

9 9

0.2

1

0.4

7

0.3

6

0.2

4

10

23

21

16


SAFETY

PUBLIC SAFETY AND EMERGENCY RESPONSE

The safety of our employees, contractors and communities is an overarching priority. The Safety, Security and Emergency Response element standard within our OEMS provides the management system framework for how we identify, plan and train for a potential incident. It is modeled on the National Incident Management System (NIMS). Our vice president of corporate safety, health and OEMS has responsibility for our emergency response plans and readiness.

We define emergency management and response plans at the corporate and site-level. Refinery or Site Emergency Response Plans are documented and include: Incident Command System (ICS) for incident management, hazard identification and risk planning and crisis management system; employee training; drills; and Fire Brigade Standard Operating Procedures. At the corporate level we undertake periodic emergency response drills led by our Corporate Crisis Assessment and Management Team, which includes executive, EHS, legal and communications staff.

Our fully-staffed emergency response teams at each refinery play a key role in helping us stay safe and address incidents quickly. Team members receive comprehensive training in hazardous materials response, rescue and medical care and firefighting, including NFPA 1081 Advanced Exterior Firefighter certification. Most refineries also host meetings with a Community Advisory Panel to share important safety practices and processes and to allow for two-way communication with local stakeholders.

Over the years, we have invested in training for nearby municipal agencies so that assisting responders obtain the skills and knowledge to effectively support our first responders if the need arises. We also perform mock emergency drills with local hospital personnel and medical staff. In times of need, we are ready to step in and support local responders by providing firefighters, first aid and other services from our trained emergency response team.

CORPORATE FIRE SCHOOL

One of our most important public safety initiatives is our annual Corporate Fire School, located at the largest fire training facility in the world on Texas A&M University’s campus. Our refineries send our emergency response personnel to learn how to prepare for and respond to accidents, natural disasters and other emergency situations. Training incorporates protective equipment, rescue procedures, incident response and management, fire behavior and other response tactics. We also invite members of the municipal fire departments from each of our refinery communities to join us in the training.

The phrase “Goal Zero” emphasizes our belief that we can operate our facilities in a safe manner each and every day.

A Goal Zero Day at HollyFrontier is one that is free of any significant occupational or process safety events which pose potential risk to our employees, contractors or surrounding communities. Accomplishing Goal Zero takes diligence.

HOLLYFRONTIER CORPORATION 13

Safety information is shared and available as appropriate for our employees, customers, vendors and the community regarding the proper handling, transportation, use and disposal of our products.

We monitor regulatory standards as they evolve to aid in keeping employees informed with up-to-date training and product data sheets.

HEP’s Pipeline Excellence Program builds upon good practices and processes that are central to how our organization operates. Our comprehensive programs seek to advance organizational safety and performance, drive reliability and deliver strong results.

Our approach allows flexibility in unique operations and environments and provides a model for continuous improvement. It builds upon existing programs and furthers a strong culture of safety within HEP.

We are dedicated to transporting our refining, lubricant and petroleum products with utmost care by pipeline, rail, truck and barge. We evaluate transportation partners with the goal that they meet regulatory obligations related to health, the environment and safety.

Trained specialists help manage transportation of our products in accordance with regulations in North America and in the over 80 countries where we market lubricants and specialty products.

Pipelines are a vital component of our nation’s infrastructure, making it imperative to safeguard our pipelines against any type of damage. We’ve implemented rigorous awareness and damage prevention programs that aim to educate the public and other key stakeholders.

These programs are an integral part of our steadfast commitment to safety and HEP’s continued focus to protect lives, the environment and property.

PRODUCT STEWARDSHIP AND TRANSPORTATION SAFETY

HEP PIPELINE EXCELLENCE


SAFETY

At HollyFrontier, we are committed to minimizing our environmental impacts through board oversight, continuous improvement investments, centralized subject matter expertise, onsite specialists, regulatory compliance and industry and community group participation.

Our Environmental, Health and Safety (EHS) policy sets out our commitment to protect the environment and to comply with all applicable laws and regulations. Our policy sets forth our guiding principles, including monitoring, auditing and continuously improving our environmental, health and safety performance and management systems.

OUR APPROACH TO ENVIRONMENTAL MANAGEMENT AND OVERSIGHT

Our Operational Excellence Management System (OEMS) provides the framework through which we identify, monitor and reduce environmental risks. Our EHS Leadership Council, composed of company executives including our CEO and corporate environmental specialists, meets quarterly to set EHS strategy and review performance. Our board of directors provides high-level oversight of our environmental performance and compliance through its Environmental, Health, Safety, and Public Policy Committee, which receives quarterly updates from our management team.

Key tenants of our OEMS environmental framework include:

OVERVIEW

1 Objectives and goals. We strive to be an industry leader and to meet and exceed regulatory compliance requirements. We do this through managing our environmental matters strategically and being proactive in our approach. We set goals for environmental performance, such as Perfect Environment Days with a target for number of days without an incident at our refineries.

2 Environmental impact and risk identification, monitoring and reporting. We incorporate environmental considerations into projects of all sizes. All environmental regulatory requirements are identified and documented at a federal, state and local level and monitored for potential rule changes. Environmental Key Performance Indicators (KPIs) are established, monitored and communicated to stakeholders internally at all levels of the organization and externally through our public reporting.

3 Employee training. All sites must provide new hire on-boarding training and at least annual continual training for employees and contractors. Environmental staff participate in our internal OEMS Network, industry seminars and conferences to stay abreast of changing rules.

4 Auditing and continuous improvement. We check for effective compliance through periodic reporting, self-audits and third-party compliance audits. We use the feedback gained for continuous improvement.

Our corporate team supports our refineries in navigating complex environmental issues and leads a compliance audit program. Industry consultants and centralized in-house experts work together to provide oversight and establish and track key performance indicators.

At the local level, an environmental manager and team of specialists actively evaluate our performance and lead compliance and improvement initiatives for each site. We also coordinate with regulatory agencies on municipal, state/provincial and federal levels to address short-term and long-term environmental compliance needs. We participate with industry groups, such as AFPM, to guide and monitor legislative and regulatory activities.



ISO-14001 ENVIRONMENTAL MANAGEMENT CERTIFICATION

Petro-Canada Lubricants became the first white oils, specialty base oils and lubricants refiner and manufacturer in the world to achieve the newest International Organization for Standardization (ISO) 14001:2015 for environmental certifications. ISO 14001 specifies requirements for an effective environmental management system used to manage environmental aspects, fulfill compliance obligations, address risks and identify opportunities.

INVESTING IN ALTERNATIVE ENERGY SOURCES

As part of our energy efficiency commitment, we consider cost-efficient renewable and alternative energy sources when undertaking facility upgrade works.

Solar-Powered LNAPL Recovery System

We have installed a solar-powered LNAPL recovery system at our Tulsa refinery.

Converting Waste to Energy

The Covanta Tulsa Energy-from-Waste facility is a 22-acre site that processes 1,125 tons-per-day of solid waste, generating up to 16.8 megawatts of power along with 300,000 pounds per hour of steam. We purchase steam from their power generation process to help run our Tulsa refinery.

ENERGY CONSERVATION

We are continually exploring ways to manage our operations more efficiently and reduce energy consumption. Designated utility engineers oversee day-to-day energy processes at our refineries and monitor equipment — such as heaters and boilers — so we can operate efficiently and in compliance with regulations. Our corporate energy team also conducts heater and boiler efficiency assessments on an annual basis.

These initiatives have reduced the amount of energy required to refine a barrel of crude oil. We also conserve energy through cogeneration technology for select use in refining operations. For example, we have 40 megawatts of installed cogeneration capacity at our El Dorado site.

In 2019, our Cheyenne refinery continued training aimed at conserving energy in our furnaces, heaters and boilers. Our operations team learned more about reducing nitrogen oxide output and using complex controls safely and efficiently. The refinery also completed a multi-year effort of accredited course training for furnace operators, leveraging guidance from a third-party expert.

ENERGY CONSUMPTION

REFINERY ENERGY INTENSITY

Thousand BTU per barrel

Historic data recalculated to reflect updated reporting methodology.

MANAGING ENERGY USE

2016 2017 2018 2019

420

40

1

40

6

40

1



We understand our business is carbon intensive. As a result, we measure and strive to minimize our potential impact on climate of both our direct Scope 1 GHG emissions and Scope 2 GHG emissions from purchased electricity.

GROUP GHG EMISSIONS

Thousand metric tons of CO2e

2016 2017 2018 2019

Scope 1 GHG emissions 4,829 5,328 5,336 5,443

Scope 2 GHG emissions 913 944 846 826

Total GHG emissions 5,742 6,272 6,182 6,269

*PCLI data included beginning 2017; Sonneborn included beginning 2019; Red Giant Oil acquired in 2018 is not included

REFINERY SCOPE 1 GHG EMISSIONS INTENSITY

Thousand metric tons of carbon dioxide equivalent (CO2e) per million barrels

We understand that our communities place their trust in us as a good neighbor. We incorporate environmental, health and safety requirements in the design phase of our projects. We also develop and follow standard operating and maintenance procedures for safe and reliable operations.

HollyFrontier measures emissions from our operations, including nitrogen oxide (NOX), sulfur dioxide (SO2), carbon monoxide (CO), particulate matter (PM2.5) and volatile organic compounds (VOCs). Emissions vary year-to-year depending upon many factors, including process unit shutdowns and throughputs.

CRITERIA POLLUTANTS

REFINERY EMISSIONS INTENSITY

Tons per million barrels

2011 Baseline

2016 2017 2018 2019

NOx 20 17 16 15 15

SOx 30 5 4 4 4

PM2.5 4 3 2 3 3

VOC 24 22 24 23 25

CO 18 15 15 16 16

GREENHOUSE GAS EMISSIONS (GHG)

AIR EMISSIONS

2011 Baseline

2016 2017 2018 2019

30

3131 3131

REDUCING OUR ENVIRONMENTAL IMPACTS

We evaluate energy and emission reduction opportunities when undertaking capital investment projects as part of our environmental Project Checklist. We have installed many control technologies to help decrease emissions from our operations, such as:

• Wet gas scrubbers are installed on all of our fluid catalytic cracking units. These scrubbers significantly reduce SO2 and particulate matter emissions.

• Many of our units also have NOx control technologies, which reduce pollutants 80–95% over uncontrolled levels.

• Flare gas recovery units have been installed at four of our refineries to recover waste gases, which are then treated and recycled for use as fuel gas in our combustion units.

• We have undertaken energy reduction activities at our lubricants facilities, including dewax exchanger cleaning, cooling tower upgrades, and boiler cleaning and chemistry changes.


WATER USE We carefully assess and manage water use from our operations and continue to explore short- and long-term opportunities to reduce and recycle water. Each site identifies opportunities to reduce water use at their specific location.

REFINERY FRESHWATER WITHDRAWAL INTENSITY

Gallons per barrel

IDENTIFYING AND PRIORITIZING WATER SCARCITY RISK

We recognize and monitor the risks water scarcity may pose to our operations. We have analyzed our water risk exposure through the WRI Aqueduct Water Risk Atlas and have identified that four of our 13 refining and manufacturing facilities are in overall “extremely high risk” or “arid and low water use” regions: our facilities in Artesia, New Mexico; Albuquerque, New Mexico; Glendale, Arizona; and Cheyenne, Wyoming. The assessment and monitoring of water scarcity risk falls under our standard environmental risk management process.

WATER SCARCITY EXPOSURE

# of facilities by “Overall” water scarcity risk exposure

CHEYENNE REFINERY SAVES 52 MILLION GALLONS OF WATER PER YEAR THROUGH CONSERVATION FOCUS

Conserving water at our high water risk exposure sites is a priority. For example, our Cheyenne, Wyoming refinery formed a Waste Water Minimization & Discharge Environmental Reliability Committee to identify and prioritize water reduction projects to reduce water purchases, reduce wastewater discharges and improve wastewater treatment plant performance, as well as be a better steward of precious water resources in arid Cheyenne, Wyoming. The team identified several projects and at least three have been completed and implemented.

The first project involved recycling waste condensate from the coker settling basin to be used at the fluid tank, which reduced water usage in the coker by approximately 10 gallons per minute (gpm). The second project involved recycling a stripped sour water stream to the desalter, saving approximately 75 gpm of water intake and release. The third project was forming a “steam team.” The steam team canvassed the entire refinery, identified leaking steam connections and completed repairs. These combined efforts have reduced water purchases by approximately 100 gpm – equal to over 52 million gallons of water per year.

Low Medium High Extremely High / Arid

8

4

1

0


2011 Baseline

2016 2017 2018 2019

51

47

38

44

41


We are committed to improving wastewater treatment plant operation by providing in-depth training to our wastewater treatment operators. We also provide training on wastewater treatment to the remaining operations staff so they understand how their activities impact our ability to effectively treat our wastewater.

REFINERY WASTEWATER DISCHARGE INTENSITY

Wastewater discharge (millions of gallons)

Wastewater discharge (gallons per barrel)

SOLID AND HAZARDOUS WASTE

REFINERY WASTE INTENSITY

Tons per million barrels

Hazardous waste Non-hazardous waste

WASTEWATER SPILLSWe believe that most incidents are preventable. We actively monitor our processes to identify loss of containment quickly. We work to prevent spills through means such as the rigorous inspection of our equipment, use of secondary containment, instrumentation to provide an extra layer of protection against tank, rail car and truck overfill, and through continued training and procedures. Spills are reported, captured on an incident log, remediated and investigated. We strive to clean spills as soon as safely possible by removing the spill material and impacted soil. Some spills are remediated using biological methods such as hydrocarbon-eating bacteria. To help us be prepared in case of an incident, we maintain an inventory of spill response equipment and regularly train our personnel on response activities to maintain preparedness.

SPILLS

Data covers spills >1 barrel

2016 2017 2018 2019

# of spills 47 75 61 41

Volume of spills (barrels)

459 699 1,018 3,9552011 Baseline

2016 2017 2018 2019

2016 2017 2018 2019

23

2,83

0

414

To

tal

337

Tota

l

320

To

tal

323

Tota

l

3,34

4 3,70

5

3,6

80

3,76

2

22

23 23

24

350

288

257

260

64

49 63 63


CLIMATE CHANGE RISK MANAGEMENT AND OPPORTUNITIESAt HollyFrontier, we are dedicated to meeting the world’s growing need for energy through dependable and affordable products. While we recognize the short-term impacts due to COVID-19, longer-term, the International Energy Agency estimates that global energy demand will continue to rise until peaking in 2040, with oil and natural gas expected to represent a substantial percentage of global energy use over that time. We anticipate renewable fuels and alternative powertrain vehicles will play an increasing role in transportation leading to changes in demand. We recognize the risks that climate change poses for society and our business – we are focused on managing those risks and prudently investing in a low-carbon future.

We are committed to providing transparency on our climate change risk management, governance and performance. The Task Force on Climate-related Financial Disclosures (TCFD) has developed voluntary, consistent climate-related financial risk disclosures that have informed our approach in providing information to stakeholders.

GOVERNANCE

Our board of directors has ultimate oversight for climate-related topics such as the risk of future carbon regulations and their potential direct or indirect costs. Issues such as the impact of current and potential federal and state regulation of carbon emissions are a regular topic of discussion by our board. Similarly, our senior executives regularly discuss the strategic risks and opportunities of issues such as renewable fuel standards and RIN credit requirements, carbon emissions fees and product demand from a shift to more fuel-efficient and electric vehicles.

STRATEGY

We have identified climate-related risks and opportunities that may affect our business over the short-, medium- and longer-term. The key risks include:

1 Regulatory risks: Greenhouse gas regulation may directly, such as through carbon fees, or indirectly, such as through vehicle fuel efficiency and electric vehicle mandates, impact our business. Any laws or regulations that may be adopted to restrict or reduce greenhouse gas emissions would likely require us to incur increased operating and capital costs.

2 Demand risks: Consumer shift to more fuel-efficient and electric vehicles could reduce demand for our products.

3 Physical risks: Extreme weather may impact our operations. We have taken actions to mitigate this including through evaluating and addressing flood and drought risks at our operations.

4 Renewable diesel opportunity: Regulatory requirements for cleaner fuels offer us an opportunity to produce lower-emission products. We have started construction of our renewable diesel plant in Artesia, New Mexico that is expected to be completed in 2022.

We are focused on investing strategically to profitably address these risks and opportunities. We expect continued global growth in gasoline and diesel demand, while prudently investing in lower-carbon alternatives.



ARTESIA RENEWABLE DIESEL – A STRATEGIC FOCUS ON LOW CARBON TRANSPORTATION FUELS

In 2019, we broke ground on a renewable diesel refinery in Artesia, New Mexico. Renewable diesel is not biodiesel: both use the same biomass feedstock, but have different production processes to produce different fuels. Renewable diesel is produced through hydrotreating and is chemically identical to conventional diesel meeting the ASTM D975 diesel standard. Therefore, renewable diesel is fully compatible with existing infrastructure and the existing diesel engine fleet can run 100% renewable diesel with no modification and no risk to engine operation. Biomass used to produce renewable diesel absorbs CO2 throughout the growing process offsetting emissions associated with production and combustion. Therefore, depending on feedstock, renewable diesel can have 50% to 80% lower net greenhouse gas emissions compared to conventional diesel.

We are currently investing approximately $350 million to construct the facility which we expect will begin producing 125 million gallons of renewable diesel annually in the first quarter of 2022. This investment will help us to meet the growing demand for lower-carbon liquid transportation fuels and further HollyFrontier’s efforts to reduce our environmental footprint.

RISK MANAGEMENT

At a group level, risks, including those related to climate and other environmental and resource-related risks (e.g. energy, climate, water and infrastructure), are managed by our environmental management team including our EHS Leadership Council. We rely on our OEMS framework to identify and guide climate risk identification and management.

METRICS

The climate change metrics we have identified as important to our business are greenhouse gas emissions, purchase of biofuel RIN credits and our revenue and production of renewable diesel. As discussed above, we are committed to minimizing our operational greenhouse gas emissions. With the expected 2022 completion of our renewable diesel project we expect to cover a majority of our annual RIN purchase obligation under current conditions, as well as generate revenue from sale of lower-carbon renewable diesel fuel.

LOWERING THE CARBON FOOTPRINT OF OUR SUPPLY CHAIN

We consider the environmental impacts in our supply chain and have undertaken programs that reduce our indirect emissions, including:

• Our Mississauga facility implemented an oil cube return program that increases the reuse and return of steel totes. Our goal is to halve the number of steel cubes we need from 2018 to 2020, saving 12,500 kg of steel annually.

• Our Mississauga facility constructed a dedicated marine line to receive imported Vacuum Gas Oil (VGO) that allows us to substitute trucking with more carbon-efficient marine delivery. In 2019, we received approximately 11,000 metric tons of VGO by marine, which resulted in a reduction of more than 100 metric tons of CO2 emissions.



OUR PEOPLE

At HollyFrontier, we believe in our company and we seek to foster an environment that is rewarding and allows our employees to thrive. Our employees receive competitive pay, performance-based bonuses, comprehensive benefit programs and retirement savings plans, topped off with a generous company match.

2019 EMPLOYMENT NUMBERS

OVERVIEW

CANADA735

UNITED STATES 3,107

EUROPE & ASIA

245

TOTAL 4,087

TURNOVER PERFORMANCE

Employee turnover

2016 2017 2018 2019

7.33% 6.80%7.67%

8.16%


OUR PEOPLE

2019 Leading the HFC Way Event

We place a high value on cultivating growth and offer training, development programs and engagement events across every level of our organization. In 2019, we continued to expand our training and development offerings, investing more than $4 million to help foster new learning opportunities for our employees.

To support our more than 4,000 employees, we launched a new talent development leadership curriculum called HFC LEAD. It stands for Leadership Excellence and Development and is a series of programs that align to our specific training requirements, our One HFC Culture and business objectives.

HFC LEAD is part of our investment in the organization to develop current and future leaders. The goal is to make certain leaders possess competencies to help achieve the company’s strategy, continue to mature our organizational culture and inspire the workforce. The curriculum is driven by employee and leader feedback, reflecting our commitment to continuously improve as a company and individuals.

HFC LEAD is focused on individual development needs while providing a structured approach to support performance excellence. HFC LEAD is comprised of the following leadership programs and events:

1 Future HFC Leader Development program aims to advance emerging talent by providing self-awareness and defined growth objectives. Participants are selected based on their demonstration of our One HFC Culture and their determination and performance in their current role.

2 Front Line Leader program delivers practical skills that are essential to preparing our managers and supervisors to meet HollyFrontier’s standard for leadership excellence. Participants are typically frontline leaders and supervisors directing the work of others. Participants can self-enroll in sessions, or their supervisor can recommend that their employees attend a session.

3 Operational Front Line Leadership Development prepares our operational frontline leaders to meet HollyFrontier’s standard for leadership excellence.

4 Managers of Managers program creates commitment and immediate action in a problem-solving, skills-learning environment. Participants are typically managers who direct supervised teams and functions. Participants are nominated by an executive sponsor.

5 Enterprise Leader program features strategic business events and individualized development focused on advanced leaders in strategic roles. Participation is sponsored by an executive leader.

6 Leading the HFC Way event provides an interactive experience focused on our One HFC Culture and leadership expectations. The event is geared toward recently promoted leaders or leaders who are new to the HollyFrontier family. Participants are selected based on eligibility requirements.

DEVELOPING OUR PEOPLE


2019 Culture Workshop with Dallas employees.

We continue to focus on the four key values of our One HFC Culture – safety, integrity, teamwork and ownership. These values influence our decisions and shape our behaviors. In 2019, we facilitated interactive culture workshops for all of our existing and new employees, showcasing outstanding examples of our culture in action throughout our organization. Workshop participants also worked in teams to identify and present recommendations on how we could further strengthen our One HFC Culture. In many sites, employees formed committees specifically to prioritize and implement the recommendations made by culture workshop participants.

In 2020, we will further this initiative by leveraging the diverse insight from our employee committees and executing our cultural action plans at the local level and across the entire organization.

DIVERSITY AND INCLUSION

In 2019, HollyFrontier made many strides toward expanding our diversity and inclusion efforts. We strategically focused our efforts on increasing the number of minority employees in engineering roles in our refineries and corporate office by introducing diversity awareness programming.

From a campus recruiting perspective, our university recruiting team partnered with various diversity and inclusion organizations at universities. Activities included sponsorship at university events honoring diversity achievement within the colleges of engineering, architecture, engineering and technology where students could share their career aspirations and resumes.

Looking ahead, HollyFrontier is in the process of partnering with historically black colleges and universities for full-time and summer internship opportunities, sponsoring the North Texas Women’s Energy Network and participating in the annual National Society of Black Engineers Convention.

FOSTERING A CULTURE OF OWNERSHIP AND GROWTH


OUR PEOPLE

EMPLOYEE RESOURCE GROUPS

In 2019, we formed two new employee resource groups focused on strengthening our support of women and veterans in the workplace.

The WiE group launched with a mission of creating a network within HollyFrontier to introduce opportunities for learning and most importantly to further enhance our great culture through collaborative events. Their first kickoff featured HollyFrontier director Anna Catalano discussing unconscious bias. As part of their ongoing efforts, the WiE group organizes companywide meetings with guest speakers and supports events and initiatives throughout the year.

The veterans’ employee resource group was also formed in 2019. Its mission is to maintain a voluntary, employee-driven group organized around a shared interest in driving veteran hiring and retention. The group launched November 7, commemorating Veterans Day and Remembrance Day with a breakfast for our U.S. and Canadian employees. The event featured a speech by a former Navy Seal in partnership with the nonprofit Carry the Load and highlighted photos from our employees of themselves, family members or loved ones who served in the armed forces.

2019 Culture Workshop at our El Dorado, Kansas refinery.

We want to inspire and empower our employees to feel confident in their long-term well-being because we understand that the health of HollyFrontier is linked to the performance and health of our people. That’s why we provide a comprehensive and competitive total rewards offering.

We are committed to paying employees competitive total compensation, as benchmarked against our peers. Consistent with our culture of ownership and growth, we provide employees the opportunity to develop their career by enhancing skills and capabilities consistent with the needs of the business and rewarding them appropriately.

HollyFrontier strives to be recognized as a leader in employee benefits because we care about the health and financial future of our employees and their

families. While our benefit offerings vary depending on each country’s market practices, they are designed to support employee health, financial and emotional needs. Our benefits include comprehensive coverage for health care, a competitive retirement savings benefit, vacation and holiday time and other income protection and work life benefits. We are responsive to our employees through the continuous analysis of our benefits program to meet our needs both now and in the future.

HollyFrontier also provides tools to help recognize and reward employee performance consistent with our One HFC Culture. Our recognition platform helps acknowledge achievements and shows employees they are valued.

HollyFrontier is committed to maintaining a positive working relationship with our local unions and their members. We believe it is in the best interest of both the employees and the company to work together in order to create a collaborative working environment. As of December 31, 2019, approximately 35% of our employees were represented by labor unions under collective bargaining agreements.

TOTAL REWARDS

LABOR PRACTICES

OUR PEOPLE




HollyFrontier positively impacts the areas where we live and work as a good employer and neighbor.

We enhance our communities economically by providing quality jobs and making capital expenditures in our facilities. As part of our commitment to continue to operate in those communities, we invested over $500 million in modernizing and upgrading our facilities in 2019.

We also seek to create a better future for our people, families and communities. Each year, we contribute volunteer time and donations to many worthy causes. Our strong relationships with local officials, schools and philanthropic organizations help move the needle on important community initiatives and solidify our role as a valued corporate citizen.

In 2019, HollyFrontier championed great causes through $2 million in donations to charitable organizations, helping to create a better future for our people, our families and our communities.

OVERVIEW

$2M

250+

IN CHARITABLE CONTRIBUTIONS

COMMUNITY ORGANIZATIONS

COMMUNITY

STEM & EDUCATION FINANCIAL LITERACY

SAFETY ENVIRONMENTAL

$500 MILLION

INVESTMENT IN OPERATIONS

UPGRADES


Historic flooding in May 2019 caused significant destruction in Tulsa, Oklahoma and changed thousands of lives. HollyFrontier is one of the largest employers in Eastern Oklahoma with more than 650 employees in Tulsa. Each of our Tulsa employees watched as the flood waters took over their city, place of work and for some, their homes. There was no question that helping others who were impacted by the flooding was the right thing to do.

In an effort to help the community start to rebuild, HollyFrontier contributed $100,000 to support Tulsa storm relief and restoration after the devastating effects of the flooding. Contributions supported recovery efforts funded through the Disaster Relief Fund for Eastern Oklahoma and restored equipment used by Tulsa’s wheelchair basketball team, the Rollin’ Roustabouts.

Seventy-five thousand dollars of the donation were allocated to the Disaster Relief Fund for Eastern Oklahoma. The fund was established by the Tulsa Area United Way and the Tulsa Community Foundation to provide assistance and support to residents of eastern Oklahoma.

Tulsa Area United Way makes a powerful impact on the community year-round and we’re proud to regularly support their work with donations and volunteer time. The Disaster Relief Fund for Eastern Oklahoma was designed to specifically assist with mid- and long-term recovery needs of affected areas long after the storms had passed.

We awarded $25,000 to Tulsa’s wheelchair basketball team, the Rollin’ Roustabouts. The team experienced tens of thousands of dollars in damage to performance wheelchairs when their facility was destroyed by flooding. The donation allowed the team to replace all damaged equipment and jumpstart their 2020 season. It’s important to rally alongside groups that help our neighbors rebuild in times of need and also give a helping hand to organizations like the Rollin’ Roustabouts so they may continue to thrive and give athletes with disabilities a special place to compete in Tulsa.

We recognize that it truly takes the community coming together in times of need and are thankful for the opportunity to do our part.

$100,000 DISASTER RELIEF DONATION HELPS TULSA REBUILD

Tulsa Community Foundation and

Rollin’ Roustabouts accept donations

from HollyFrontier.



EL DORADO HELPS BUILD HOPE FOR CHILDREN AT RISK

Our El Dorado refinery supports at-risk children and families through their partnership with Sunlight Children’s Advocacy and Rights Foundation (SCARF) and has been an active contributor since 2012.

SCARF provides a safe haven and crucial resources for many vulnerable and abused children in El Dorado. HollyFrontier El Dorado has served the organization by volunteering, serving on the board, sponsoring SCARF’s annual Buckaroo Ball fundraiser and giving two donations in 2019. These contributions have helped the organization dream bigger and impact even more children.

The first donation of $65,000 came from HollyFrontier El Dorado’s annual golf tournament. Employees worked hard to raise half of the amount and the other half came from a company match.

This gift helped SCARF expand existing programs and implement new ones. A portion went to purchasing a child abuse prevention curriculum that SCARF then took to local schools for early awareness training for students. The three-month pilot program touched the

lives of a several students who received urgent support from SCARF’s Child Advocacy Center. The donation also funded new programs such as expanded, free mental health services and a certified therapy dog initiative to serve as a calming presence for children.

The second gift of $30,000 supported SCARF’s new Children’s Advocacy Center. This new facility provides an opportunity to walk alongside children in their toughest moments and let them know someone is willing to listen. The donation provided full funding for the building’s welcome center, which was named after HollyFrontier. It includes a conference room, waiting room and children’s play area.

HollyFrontier helped with the new building’s construction by providing electrician support, saving SCARF an estimated $20,000. Employees also came together during a volunteer day to paint the center.

We are proud to play our part in this pivotal cause by partnering with SCARF to positively impact the lives of even more children in the future.

“Because of you, we were allowed to dream a little

bigger and because of you we were able to directly

help children that we would otherwise not have known

were crying for help.” – SCARF CEO

Tulsa Community Foundation and

Rollin’ Roustabouts accept donations

from HollyFrontier.

El Dorado refinery employees volunteer

to paint the new Children’s Advocacy

Center at SCARF.


At HollyFrontier, we believe science, technology, engineering and mathematics (STEM) are important because they impact every part of our lives and industry. Our Navajo refinery is a long-time supporter of local STEM projects and programs and is excited to continue partnering with Lovington and Artesia public schools on even more initiatives in the future.

For the past five years, our Navajo refinery has partnered with Lovington Schools to enhance STEM programs. HollyFrontier funded the installation and addition of new equipment at a STEM lab at the Quest Center in Lovington for the RoboCats middle and high school robotics team.

Our annual investment of $45,000 to the Lovington STEM lab has provided an entire woodworking shop, a 3D printer and about five virtual reality workstations that allow them to experience activities such as going inside a volcano or dissecting a heart. We also invest $20,000 annually to support the RoboCats students by financing their travel to numerous competitions each year. HollyFrontier employees proudly travel to attend competitions to cheer on the team as well. The refinery hosts a three-day robotics camp each year, investing $8,000 annually in this event.

We are also partnering with Artesia Public Schools and investing $125,000 toward the future development of new a district-wide STEM initiative and relevant professional development for teachers.

As a part of that initiative, all five Artesia public elementary schools will be equipped with a new discovery center accessible to all grades as part of their weekly curriculum. Each center will provide hands-on learning experiences and mobile STEM labs where students can design, build and program through CAD software, create products on a 3D printer, explore robotics/coding and discover the world of virtual reality through zSpace computers.

We are excited to see how these programs inspire students, empower innovation and engage them in essential high-level thinking. These collaborative partnerships also embody our commitment to build strong, positive relationships with our local public schools by showing up to support students and teachers, in addition to monetary donations.

NAVAJO EMPOWERS STUDENTS WITH STEM CONNECTIONS

Left: Employees at our Lovington facility come

together to teach students about refining.

Right: Employees give tours to the Lovington STEM/Robotics

team, all 5th graders from the five Artesia elementary schools, NMSU Engineering

students and Texas Tech university students.



A cross-functional group of employees at our Mississauga facility worked together to host their annual Community Connect campaign, which raises awareness for six local charitable organizations through fundraising events and volunteer opportunities.

Members of the 2019 campaign hosted more than five fundraising events throughout the two-week period, including a motorcycle rally, soccer tournament and an employee barbecue. Through employee contributions ($72,600), vendor support ($85,000), and company donations ($21,000), we were pleased to present the following six local charitable organizations with donations totaling $178,600 CAD:

• Armagh: a second-stage housing program that offers secure and affordable housing to abused women, with or without children, for up to one year.

• The Compass: offers immediate food assistance and works with clients offering practical and spiritual support to the challenges that often come along with a low income.

• Credit Valley Conservation: a community-based environmental organization, dedicated to protecting, restoring and managing the natural resources of the Credit River Watershed.

• Ian Anderson House: Ontario’s first in-resident cancer hospice offering quality end-of-life palliative care in a home-like setting to individuals diagnosed with terminal cancer and a limited life expectancy.

• Interim Place: a shelter that provides support services for women in Peel Region.

• United Way Greater Toronto: the largest non-governmental supporter of social services in the region, dedicated to creating the opportunities people need to improve their lives.

In addition, 80 employees located in the Greater Toronto Area attended 11 volunteer opportunities in support of these local organizations throughout 2019, totaling more than 290 volunteer hours.

MISSISSAUGA EMPLOYEES CONNECT FOR THE COMMUNITY

Left: Employees at our Lovington facility come

together to teach students about refining.

Right: Employees give tours to the Lovington STEM/Robotics

team, all 5th graders from the five Artesia elementary schools, NMSU Engineering

students and Texas Tech university students.

Six local organizations, including Interim Place,

received funds from the Community

Connect campaign.


In September 2019, our Woods Cross refinery employees volunteered during United Way’s annual Day of Caring event benefitting the Bountiful Food Pantry. The team spent the day landscaping, painting and helping with other maintenance needs. HollyFrontier also donated $10,000 to the organization to support the community. We are proud to see our employees model what it means to be a good neighbor and lend a helping hand to those in need.

WOODS CROSS SUPPORTS NEIGHBORS IN NEED WITH LOCAL FOOD PANTRY

DALLAS GIVES BACK TO LOCAL CHILDREN

Our Cheyenne employees volunteer with Rooted, a non-profit organization, to plant trees in neighborhoods near the refinery. Rooted’s mission is to support a more diverse and resilient urban canopy and cultivate greener, healthier, more livable neighborhoods through a long-term tree planting program.

CULTIVATING A GREENER CHEYENNE

Dallas employees build 150 fully stocked backpacks to be donated to at-risk

children in the care of a local charity, Community Partners of Dallas.

Volunteers from our Woods Cross refinery cleaned and helped beautify the

outskirts of the Bountiful Food Pantry.



We believe that good governance policies and practices provide an important foundation for the long-term viability of our companies. HollyFrontier and HEP’s boards of directors and senior management believe that one of their primary responsibilities is to promote a culture of accountability, responsibility and ethical conduct throughout our companies.

To help guide governance practices and policies, the HollyFrontier and HEP boards of directors have each appointed a lead independent director and have the following committees:

HOLLYFRONTIER

Audit

Compensation

Environmental, Health, Safety, and Public Policy

Finance

Nominating/Corporate Governance

HEP

Audit

Compensation

Conflicts

Our independent directors possess a diverse mix of skills, professional experiences, viewpoints and backgrounds. The HollyFrontier board of directors is comprised of 10 directors, nine of whom are independent. The HEP board of directors is comprised of five directors, four of whom are independent. On each board of directors, 20% of the directors are women.

BOARD OF DIRECTORS

At HollyFrontier and HEP, we uphold the highest standards of business ethics and promote good governance. HollyFrontier and HEP each operate under their respective organizational documents, code of business conduct and ethics, governance guidelines and board committee charters, which form the governance framework for each company.


HollyFrontier and HEP regularly assess and manage a variety of risks inherent to our business, such as key economic, social, regulatory and environmental issues. Management is responsible for evaluating and mitigating risk, but the board of directors and the board committees of HollyFrontier and HEP are responsible for providing high-level oversight of the risk exposure for their respective company.

The risk management oversight committee is made up of management personnel who monitor the risk environment for each company as a whole. Each board receives input from its company’s risk management oversight committee on potential and actual risks.

RISK MANAGEMENT

COMPLIANCE

Our longstanding commitment to ethical behavior is inherently tied to how we do business. It is our job to do what is right for our employees, investors, communities and the environment. Our Code of Business Conduct and Ethics is our commitment to conduct our business with integrity and in compliance with all applicable laws. The Code is the basis for a common set of values and standards to which all directors, officers and employees must adhere.

We expect our valued partners to share our commitment to doing business ethically. We have established codes of conduct for both our suppliers and distributors which reflect the same standards to which we hold ourselves. The codes set forth our expectations in areas such as conflicts of interest, gifts, travel and entertainment and human rights. We expect that these partners will comply with these codes, as well as applicable laws, rules and regulations as a part of our business relationship and we provide periodic training to these groups on these principles.

In addition, our Anti-Corruption Policy sets forth our commitment to conducting our business operations throughout the world fairly, honorably and with integrity. The policy prohibits bribes in any form and requires compliance with all applicable laws regarding bribery and corruption.

We respect human rights provisions of the countries where we operate, including laws against human trafficking, forced labor and child labor, and those

prohibiting discrimination based upon race, color, religion, sex, sexual orientation, gender identity, national origin, age, disability or veteran status. We do not knowingly conduct business with any individual or company that participates in discrimination, the exploitation of children (including child labor), physical punishment, forced or prison labor or human trafficking.

ETHICS AND COMPLIANCE HOTLINE

We strive to create a workplace environment in which everyone feels comfortable raising concerns. We encourage employees, vendors, customers and other business partners to ask questions and report any suspected violations of the law or company policies. We know it takes courage to come forward and share concerns. We do not tolerate retaliation against anyone who raises questions or concerns; anyone who promptly and in good faith reports an alleged violation of the Code, the company’s policies and procedures or the applicable laws or regulations; or anyone who participates or cooperates honestly and completely in the investigation of a report.

We provide a toll-free compliance hotline and compliance reporting website address to communicate violations of the codes. Reports received through the compliance hotline or website are kept confidential and anonymous at the request of the reporting person to the extent possible. We review and respond to all reports of suspected violations as appropriate.


As individuals and as a company, we collectively strive to make the right business decisions regarding safety, the environment and our communities.

HollyFrontier operates in a complex, regulated industry. We know the decisions made today will shape the laws and regulations under which we operate tomorrow. As such, we believe it is vital to be engaged with our federal, state/provincial and local governments. HollyFrontier works with lawmakers and regulators at all levels of government to keep them apprised of impacts existing and proposed laws and regulations may have on our industry.

In 2019, we kept a clear focus on several policy debates that are critical to HollyFrontier, including:

• The Renewable Fuel Standard (RFS)

• Trade related issues such as the United States Mexico Canada Agreement (USMCA) and global tariffs

• Pipeline Reauthorization

• Tax extenders such as the biodiesel blenders tax credit

As an example of how public policies impact our business: complying with the RFS cost HollyFrontier approximately $150 million in 2019 alone. This program was borne out of an era defined by energy scarcity and is no longer consistent with today’s economy of energy abundance. We continue to advocate for comprehensive reforms of the biofuels mandate to reflect the current market dynamics and needs of the transportation fuel industry going forward. While we disagree with the premise of the program, we are making investments to reduce our overall compliance costs with the RFS.

Our advocacy efforts include HollyFrontier Corporation’s Political Action Committee (HFC PAC). HFC PAC is employee-led, non-partisan and supported by voluntary contributions. HFC PAC takes an active role in both federal and state elections. Through this resource, HFC PAC seeks to identify and support candidates whose ideals and objectives align with our own. Additional information on HFC PAC, including monthly filings, may be accessed online at fec.gov.

PUBLIC POLICY AND ADVOCACY



APPENDIX

TASK FORCE ON CLIMATE-RELATED FINANCIAL DISCLOSURES INDEX

GOVERNANCE

a) Board Oversight

Our board of directors has ultimate oversight for climate-related topics such as the risk of future carbon regulations and their potential direct or indirect costs. Issues such as the impact of current and potential federal and state regulation of carbon emissions are a regular topic of discussion by our board.

b) Management Role

Our senior executives regularly discuss the strategic risks and opportunities of issues such as renewable fuel standards and RIN credit requirements, carbon emissions fees and product demand from shifts such as to more fuel-efficient and electric vehicles.

STRATEGY

a) Climate-Related Risks and Opportunities

We have identified climate-related risks and opportunities that may affect our business over the short-, medium- and longer-term. The key risks include:

Regulatory risks: Greenhouse gas regulation may directly, such as through carbon fees, or indirectly, such as vehicle fuel efficiency and electric vehicle mandates, impact our business. Any laws or regulations that may be adopted to restrict or reduce GHG emissions would likely require us to incur increased operating and capital costs.

Demand risks: Consumer shift to more fuel-efficient and electric vehicles could reduce demand for our products.

Physical risks: Extreme weather may impact our operations. We have taken actions to mitigate this including through evaluating and addressing flood and drought risks at our operations.

Renewable diesel opportunity: Regulatory requirements for cleaner fuels offers us an opportunity to produce lower-emission products. We have started construction of our renewable diesel plant in Artesia, New Mexico that is expected to be completed in 2022.

We are committed to providing transparency on our climate change risk management, governance and performance. A summary of our response to the TCFD-recommended disclosures is below.

b) Impact on Strategy

We are focused on investing strategically to profitably address identified climate-related risks and opportunities. We expect continued global growth in gasoline and diesel demand, while prudently investing in lower-carbon alternative.

c) Climate Resilience

We actively monitor changing regulatory, demand and physical risks to our business, as well as new opportunities. Our management and board is focused on prudently investing for the future to meet consumer demand.

RISK MANAGEMENT

Our leadership team and board of directors are focused on managing the risks to our business, including climate change-related risks. At a group level, risks, including those related to climate and other environmental and resource-related risks (e.g. energy, climate, water and infrastructure), are managed by our environmental management team including our EHS Leadership Council. We rely on our OEMS framework to identify and guide climate risk identification and management. We monitor and assess these risks to help inform our operating and investment decisions.

METRICS

a) Metrics

We monitor absolute energy use and Scope 1 + Scope 2 emissions, and intensity per barrel.

b) Scope 1 and Scope 2 GHG emissions

Scope 1 emissions (2019): 5,442,634 metric tons of CO2e Scope 2 emissions (2019): 826,020 metric tons of CO2e

c) Targets

We target renewable diesel production and avoided RIN credit purchases from our Artesia, New Mexico project expected to be completed in 2022.

SASB INDEX AND PERFORMANCE DATA

METRIC SASB CODE 2016 2017 2018 2019

Greenhouse Gas Emissions

Greenhouse gas emissions (kt CO2e) -- 5,742 6,272 6,182 6,269

GHG Scope 1 emissions (kt CO2e) EM-RM-110a.1 4,829 5,328 5,336 5,443

GHG Scope 2 emissions (kt CO2e) -- 913 944 846 826

Energy Management

Facilities energy consumption (GWh) -- 20,714 23,294 22,777 23,156

of which, grid electricity (GWh) -- 1,618 1,838 1,815 1,808

Air Quality

NOx (tons) EM-RM-120a.1 2,631 3,205 3,055 3,204

SO2 (tons) EM-RM-120a.1 805 1,390 1,406 1,404

PM2.5 (tons) EM-RM-120a.1 403 358 447 437

VOCs (tons) EM-RM-120a.1 3,470 3,973 3,795 4,058

CO (tons) -- 2,389 2,542 2,574 2,676

Water Management

Fresh water withdrawal (million gallons) EM-RM-140a.1 7,693 19,698 19,478 19,358

Process water (million gallons) -- 7,693 7,287 7,042 7,410

Once-through cooling water (million gallons) -- 12,410 12,435 11,948

Water discharge (million gallons) -- 3,469 10,562 11,222 12,393

Waste Management

Waste generation (tons) -- 64,233 68,293 55,664 77,953

Hazardous waste (tons) EM-RM-150a.1 9,875 8,678 11,488 11,003

Non-hazardous waste (tons) -- 54,358 59,615 44,176 66,951

Workforce Health & Safety

Combined Total recordable Incident Rate (per 200,000 hours worked) 0.56 0.50 0.68 0.61

Employees (per 200,000 hours worked) EM-RM-320a.1 0.85 0.57 0.67 0.51

Contractors (per 200,000 hours worked) EM-RM-320a.1 0.26 0.40 0.70 0.75

Fatalities (#) 0 1 0 0

Employees (#) EM-RM-320a.1 0 1 0 0

Contractors (#) EM-RM-320a.1 0 0 0 0

Discussion of management systems used to integrate a culture of safety EM-RM-320a.2 See Safety section

HollyFrontier Group Data

Environmental and safety data includes PCLI beginning 2017 and Sonneborn facilities beginning 2019, following respective acquisitions.

Environmental data includes asphalt operations beginning 2019 (excluding waste and water data).

Red Giant Oil, acquired in 2018 and providing blending and distribution services, is excluded from environmental data.

PCLI and Sonneborn Amsterdam air emissions data partially estimated for 2019 due to COVID-19 operational-related impacts on finalizing data.

* Spills data monitored at refinery and asphalt facilities.

METRIC SASB CODE 2016 2017 2018 2019

Management of the Legal & Regulatory Environment

Discussion of corporate positions related to government regulations and/or policy proposals that address environmental and social factors affecting the industry

EM-RM-530a.1 See Corporate Governance – Public Policy and Advocacy section

Critical Incident Risk Management

Tier 1 incident rate (per 200,000 hours worked) EM-RM-540a.1 0.08 0.16 0.15 0.14

Tier 1 incident count (#) -- 4 8 9 9

Tier 2 incident rate (per 200,000 hours worked) EM-RM-540a.1 0.21 0.47 0.36 0.24

Tier 2 incident count (#) -- 10 23 21 16

Spills >1 barrel (barrels)* -- 459 699 1,018 3,955

Spills >1 barrel (#)* -- 47 75 61 41

Activity Metric

Refining throughput (MMBBL) EM-RM-000.A 154.67 160.09 157.53 156.25

Refining operating capacity (MBPD) EM-RM-000.A 457 457 457 457

REFINERY ENVIRONMENTAL PERFORMANCE DATA

METRIC 2016 2017 2018 2019

Greenhouse Gas Emissions

Greenhouse gas emissions (kt CO2e) 5,667 5,745 5,661 5,636

GHG Scope 1 emissions (kt CO2e) 4,829 4,896 4,904 4,905

GHG Scope 2 emissions (kt CO2e) 838 849 757 731

Refinery GHG intensity (Scope 1 kt CO2e/MMBBL) 31 31 31 31

Energy Management

Energy Consumption (GWh) 20,577 20,547 20,027 19,826

of which, grid electricity (GWh) 1,481 1,516 1,492 1,454

Refinery energy intensity (MBTU/BBL) 402 420 406 401

Air Quality

NOx (tons) 2,631 2,497 2,342 2,370

SOx (tons) 805 715 633 554

PM2.5 (tons) 403 306 432 416

VOCs (tons) 3,470 3,834 3,652 3,930

CO (tons) 2,389 2,462 2,498 2,525

Refinery Intensity

NOx intensity (tons per MMBBL) 17 16 15 15

SOx intensity (tons per MMBBL) 5 4 4 4

PM2.5 intensity (tons per MMBBL) 3 2 3 3

VOCs intensity (tons per MMBBL) 22 24 23 25

CO intensity (tons per MMBBL) 15 15 16 16

Water Management

Fresh water withdrawal (million gallons) 7,245 6,998 6,477 6,010

Wastewater discharge (million gallons) 3,344 3,705 3,680 3,762

Refinery Intensity

Fresh water withdrawal intensity (gallons/BBL) 47 44 41 38

Wastewater discharge intensity (gallons/BBL) 22 23 23 24

Waste Management

Waste generation (tons) 64,233 54,063 50,453 50,414

Hazardous waste (tons) 9,875 7,885 9,912 9,773

Non-hazardous waste (tons) 54,358 46,178 40,541 40,641

Refinery Intensity

Waste generation (tons/MMBBL) 414 337 320 323

Hazardous waste (tons/MMBBL) 64 49 63 63

Non-hazardous waste (tons/MMBBL) 350 288 257 260


2828 N. Harwood, Suite 1300 | Dallas, TX 75201 | hollyfrontier.com

20192019 CITIZENSHIP REPORT HollyFrontier Corporation (HollyFrontier), headquartered in Dallas,...

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Transcript of 20192019 CITIZENSHIP REPORT HollyFrontier Corporation (HollyFrontier), headquartered in Dallas,...