CVR Refining, LP CVRR
today announced that the proposed U.S. Environmental Protection Agency Tier
III sulfur regulations will have no impact on the company's previously
announced full year 2013 distribution guidance of $5.50 to $6.50 per common
unit. The midpoint of this guidance represents a distribution yield of 19
percent based on the company's closing common unit price on April 2, 2013, of
$31.47.
Further, the company also announced that estimated costs to meet Tier III
standards are less than $20 million. The full amount of this upgrade was
reserved as cash on the company's balance sheet at the close of its IPO on
Jan. 23, 2013.
CVR Refining's 70,000 barrel per day Wynnewood refinery currently has the
capability to meet Tier III standards without further investment. The
company's 115,000 barrel per day Coffeyville refinery will require an
approximate $20 million upgrade to its ultra-low sulfur gasoline unit. This
project is expected to be completed during the refinery's next scheduled
turnaround in 2016.
Operating cost increases as a result of the higher desulfurization levels of
gasoline are not expected to be material to the company's performance.
EPA has proposed regulations that gasoline contain no more than 10 parts per
million of sulfur on an annual average basis by Jan. 1, 2017.
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