Welcome to HollyFrontier Corporation's fourth quarter 2020 conference call and webcast. Hosting the call today from HollyFrontier is Mike Jennings, President and Chief Executive Officer. He's joined by Rich Voliva, Executive Vice President and Chief Financial Officer, Tim Go, Executive Vice President and Chief Operating Officer, Tom Creery, President, Refining and Marketing, and Bruce Lerner, President, HollyFrontier Lubricants and Specialties. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following the presentation. If you'd like to ask a question at that time, please press star one on your touch-tone phone. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. If you should require operator assistance, please press star zero. We do ask that you please limit yourself to one question and one follow-up. Additionally, we ask that you pick up your handset to allow optimal sound quality. Please note that this conference is being recorded. It is now my pleasure to turn the floor over to Craig Biery, Vice President, Investor Relations. Craig, you may begin. Thank you, James. Good morning, everyone, and welcome to HollyFrontier Corporation's fourth quarter 2020 earnings call. This morning, we issued a press release announcing results for the quarter ending December 31st, 2020. If you would like a copy of this press release, you may find one on our website at hollyfrontier.com. Before we proceed with remarks, please note the safe harbor disclosure statement in today's press release. In summary, the statements made regarding management expectations, judgments, or predictions are forward-looking statements. These statements are intended to be covered under the Safe Harbor provisions of federal security laws. There are many factors that could cause results to differ from expectations, including those noted in our SEC filings. The call also may include discussion of non-GAAP measures. Please see the press release for reconciliations to GAAP financial measures. Also, please note any time-sensitive information provided on today's call may no longer be accurate at the time of any webcast replay or rereading of the transcript. With that, I'll turn the call over to Michael Jennings. Great. Thank you, Craig. Good morning, everyone. 2020 was an unprecedented year for HollyFrontier. In the face of extraordinary challenges created by the COVID-19 pandemic, HollyFrontier persevered and took important steps to strengthen our business in both the short and long term. We controlled what we could, focusing on the fundamentals of the business, maintaining a disciplined approach to capital allocation, and continuing our efforts to further enhance reliability, safety, and efficiency. We made key investments in renewable initiatives that will enable HollyFrontier to capture new opportunities as our industry evolves, and our lubricants business realized strong earnings in the second half of the year, despite the global pandemic. We ended the year with a strong balance sheet, healthy liquidity, and high-quality assets that position us to capitalize on our competitive advantages. Looking ahead to 2021 and beyond, I believe that HollyFrontier is well-positioned for long-term success as our core businesses rebound and we continue our expansion into renewables. Turning to the fourth quarter results, we reported a net loss attributable to HollyFrontier shareholders of $118 million, or $0.73 per diluted share. These results reflect special items that collectively increased the net loss by $1 million. Excluding these items, adjusted net loss for the fourth quarter was $119 million or $0.74 per diluted share versus adjusted net income of $78 million or $0.48 per diluted share for the same period in 2019. Adjusted EBITDA for the period was negative $22 million, a decrease of $285 million compared to the fourth quarter of 2019. The refining segment reported Adjusted EBITDA loss of $112 million compared to $172 million earnings for the fourth quarter of 2019, and consolidated refinery gross margin of $4.02 per produced barrel was a 71% decrease compared to the same period last year. This decrease was primarily due to the impact of continued weak demand for transportation fuels, coupled with compressed crude differentials. Fourth quarter margins were also impacted by a year-end inventory LIFO charge of approximately $35 million, or $0.85 per barrel on a consolidated basis. Fourth quarter crude throughput was approximately 380,000 barrels per day at the top end of our guidance of 360,000-380,000. Despite the tremendous obstacles we faced in 2020, we achieved strong safety performance and operational availability within our refining segment. Our lubricants and specialty products business reported EBITDA of -$33 million compared to $35 million in the fourth quarter of 2019. This decrease was driven by a goodwill impairment charge of $82 million related to Sonneborn. Excluding the impairment, our Lubricants & Specialties segment reported Adjusted EBITDA of $49 million. rack forward adjusted EBITDA was $48 million, representing an 11% Adjusted EBITDA margin. Despite typical seasonality in the fourth quarter, rack forward reported a solid quarter due to continued demand improvement in our industrial and transportation end markets. Sales volumes were essentially flat compared to the third quarter and were down only 2% versus the prior year. Within the rack back portion, demand for base oils remained healthy as margins strengthened to their highest levels since 2017. Holly Energy Partners reported EBITDA of $87 million for the fourth quarter, compared to $88 million in the fourth quarter of last year. Despite lower volumes year-over-year, HEP delivered strong fourth quarter earnings supported by long-term minimum volume commitment contracts. Looking to 2021, we're optimistic for better market conditions that will facilitate HollyFrontier's continued growth, evolution, and success. Within our refining segment for the first quarter of 2021, we expect to run between 350,000-380,000 barrels per day of crude oil. In addition to the continued weakness in demand resulting from the COVID-19 pandemic, the crude charge in the first quarter of 2021 has also been adversely impacted by scheduled maintenance at our Tulsa West and Woods Cross refineries, as well as reduced availability of natural gas due to the extreme recent cold weather throughout the mid-continent Southwest. We believe that demand for transportation fuels will strengthen as COVID-19 vaccines are distributed and the global economy recovers from the pandemic. We expect to adjust refinery production levels commensurate with market demand. Within our Lubricants and Specialties segment, underlying demand for both finished products and base oil remains strong, and we expect a normal seasonal rebound in the first quarter of 2021. However, we do not have enough visibility to issue 2021 guidance at this time. Similar to our Refining segment, we expect to adjust production levels commensurate with market demand. HEP, we expect to see demand for transportation and terminaling services grow with underlying demand for transportation fuels and crude oil. In 2021, HEP expects to hold the quarterly distribution constant at $0.35 per unit or $1.40 on an annualized basis. We remain committed to our distribution strategy focused on funding all capital expenditures and distributions within free cash flow and maintaining distributable cash flow coverage of 1.3 x or greater, with the goal of reducing leverage to 3.0x-3.5 x EBITDA. In our renewables segment, we're advancing our renewable diesel and pretreatment units in Artesia, New Mexico, and our renewable diesel unit in Cheyenne, Wyoming. We're on track to complete the projects on time and at the high end of our budgeted range, with the ability to produce over 200 million gallons of renewable diesel beginning in the first quarter of 2022. We ended 2020 with a solid operational performance and a strong financial foundation. We strategically maintain a conservative balance sheet, positioning HollyFrontier to withstand cyclicality while maintaining our strategic priorities. Our focus remains on generating high returns while operating safely and efficiently, further improving our refinery reliability, progressing our transition into renewables, enhancing our environmental and sustainability performance, and continuing to prudently deploy capital to advance our shareholders' best interests. With that, let me turn the call over to Rich. Thank you, Mike. As previously mentioned, the fourth quarter included a few unusual items. Pre-tax earnings were positively impacted by a lower of cost or market adjustment of $149 million, partially offset by goodwill and long-lived asset impairment charges totaling $108 million, in addition to costs related to the Cheyenne refinery conversion to renewable diesel production. These costs include decommissioning charges of $12 million, LIFO inventory liquidation costs of $3 million and severance costs totaling approximately $300,000. A table of these items can be found in our press release. Cash flow from operations was $67 million in the fourth quarter, which included $21 million of turnaround spending and $93 million of working capital gains. We were successfully able to draw down inventory in the fourth quarter to better manage working capital. HollyFrontier's standalone capital expenditures totaled $97 million for the quarter and $271 million for the full year of 2020. As of December 31st, 2020, our total liquidity stood at approximately $2.7 billion, comprised of a standalone cash balance of over $1.3 billion, along with our undrawn $1.35 billion unsecured credit facility. As of December 31st, we had $1.75 billion of standalone debt outstanding with a debt-to-cap ratio of 25% and a net debt-to-cap ratio of 6%. During the fourth quarter, we declared and paid a dividend of $0.35 per share, totaling $58 million. HEP distributions received by HFC during the fourth quarter totaled $21 million. HollyFrontier owns 59.6 million HEP limited partner units, representing 57% of HEP's LP units, with a market value of over $950 million as of last night's close. Looking ahead, in the first half of 2021, we anticipate recovering $50 million-$60 million in cash tax benefit from carryback of a net operating loss under the CARES Act and an additional $21 million to recover estimated tax payments that were made during 2020. With respect to capital spending, we have slightly increased our guidance for 2021, specifically in our renewables segment, to account for the timing of invoices from 2020 into 2021. We now expect to spend between $520 million and $550 million in renewables versus our original guidance of $500 million-$530 million. We still expect to spend between $190 million and $220 million for capital at HollyFrontier Refining, $40 million-$50 million at HollyFrontier Lubs and Specialties, and $320 million-$350 million for turnarounds and catalysts. HEP, we expect to spend $14 million-$18 million for maintenance capital, $30 million-$35 million for expansion capital, which includes our investment in the Cushing Connect joint venture, and $5 million-$8 million in refinery processing unit turnarounds. Beginning in the fourth quarter, activities associated with the conversion of HollyFrontier's Cheyenne Refinery to renewable diesel production, along with the construction of renewable diesel and pretreatment units in Artesia, New Mexico, are reported in HollyFrontier's corporate and other segments. For fiscal year 2021, we expect corporate segment operating expenses to be in the range of $100 million-$120 million, which includes decommissioning and severance costs related to the Cheyenne Refinery conversion in the range of $20 million-$30 million. With that, James, we're ready to take questions. The floor is now open for questions. At this time, if you have a question or comment, please press star one on your touch-tone phone. We ask that you please limit yourself to one question and one follow-up. If you have additional questions, we welcome you to rejoin the queue. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. Thank you. Our first question comes from the line of Manav Gupta with Credit Suisse. Go ahead, please. Your line is open. Hey, guys. I think when you envisioned the PCLI business, one of the key goals was that rack back should break even on an EBITDA, and then rack forward should generate the positive EBITDA. In terms of rack back, I think you have achieved your goal in this quarter. Rack back was neutral. Just trying to understand on the rack forward side, Q4 was good, but Q3 was better. From a run rate perspective, when we are thinking about the first half of 2021, would a Q3 run rate on for rack forward be a better guidance or a Q4 could be a better guidance, specifically as it relates to rack forward? Manav, it's Rich. A couple things happened in the fourth quarter. Keep in mind that there's always a little bit of a lag here. Base oil prices obviously rose throughout the fourth quarter, and we had to absorb that on the rack forward side. That did impact the quarter, and there is also always some annual seasonality around the year-end period. That really were the two things we can point to in the fourth quarter. I think to your point, demand is very strong. As Mike said, we cannot issue guidance at this time because we are still seeing obviously a lot of volatility in the market. In the long run, I'd take you back to our expectation that we're going to do $250 million to $300 million of EBITDA in this business, and that is our long-run belief. Okay. A quick follow-up here is, Rich, I think when you had first come up with the prospects of expanding your renewable diesel business, you had kind of given out a range of returns that you expected. Since then, a few things have happened. Ultra-low sulfur diesel prices have moved up as the global economy has recovered, as crude has moved up. RIN prices have moved up significantly, but so have the feedstock prices. I'm just trying to understand from the perspective of return, has there been any change under HollyFrontier on their internal rate of return calculation, considering the three parameters have moved in different directions? Yeah, Manav, this is Tom Creary. Yeah, we have seen that in the marketplace, and we've put that into our models and taken a look at it to see what the profitability and earnings would be on a go-forward basis. We don't really see that much variation in regard to what's happening now as to what our original plan was. Maybe I could sum it up as a rising tide floats all boats, but we have seen soybean oils go up in price. We've seen RINs go up in price. We've seen fats, oils, everything is going up in price along with crude oil and RINs as well. Yeah. The other piece of that is there's now probably an expectation that the Blenders' Tax Credit persists for longer than just 2022, and that was not baked into our original outlook. Overall higher, at least because of that. Yes. When we did our initial modeling, we only took Blenders' Tax Credit to the end of 2022 and then forecasted zero thereafter. If Biodiesel Blenders' Tax Credit is extended, which most likely will be considering the stance of the Biden administration on renewables, that's straight $210 million of EBITDA to you, right? That is correct, yes. Thank you for taking my questions. Our next question comes from the line of Ryan Todd with Simmons Energy. Go ahead, please. Your line is open. Great. Thanks. Maybe a follow-up on the renewable diesel business. I guess quickly, what was the driver of the upward revision to CapEx for this year? Then as you move closer to completion of the RD plans, can you talk about some of your ongoing efforts to establish supply chains on the feedstock side? Are you in conversations with feedstock aggregators, particularly for low CI feedstocks? Can you talk a little bit about your confidence in your ability to efficiently access a range of feeds? No, really, it's just timing of some of these invoices and the cash flows being in 2021 versus late 2020. To give you some color here, we ended up spending about $120 million in 2020 instead of our guided $130 million-$145 million. We're about $20 million short in cash out the door in 2020, hence our guidance for 2021 has gone up by about that number. Really just timing. Morning, Ryan. In regard to your question about what agreements we've entered into and are looking at, yes, on the feedstock side, we've been talking to local tallow guys, as well as other feedstock providers of soybean oil and degummed soybean oil, soybean oil that's both refined and degummed, as well as other feedstocks, including corn oil. We've got one agreement in place in terms of the feedstocks already inked up. On the offtake agreement, we have several contracts that we have entered into for disposition to California, as you could well imagine, at pricing that is very favorable in our opinion as we go forward. We're in pretty good shape. We've been talking to co-ops. We've been talking to just about anybody, rendering plants, anybody that has feedstock available for supply issues. Part of the problem on the feedstocks that we're seeing is that it's difficult to enter into some of these agreements when we're still 10 months away, and some of these things will happen a lot faster as we get closer to completion, both mechanical and operational, and they see that we're there to do business. Great. Thanks. I appreciate that color. Maybe switching gears to the refining side. refining margins are obviously up significantly year-to-date, and although RIN pricing is probably going to cut into that there and what your outlook is for the next couple of quarters in terms of gasoline and distillate market dynamics? Sure. In terms of gasoline and other refined products, diesel. Before we went into this polar vortex situation, we were pretty pleased where demand was going. In gasoline, I would say that our best recovery has been in PADD 4 on gasoline and probably the worst, and it hasn't been that bad, was PADD 3, where when we compare it to 2019, the demand was probably off 4% or 5% in total. That's not much of a decrease compared to 2019. Distillate, on the other hand, we were very pleased with distillate. It was at or higher than all 2019 levels. Distillate was in good demand. In terms of crack, it's hard to forecast that on a go-forward basis, but we would expect cracks to improve as we get into the driving season as well as the ag season as they start to plant crops again. With what we're seeing in crop prices, whether it be soybean, corn, or anything else, I think the farmers will be in a busy this summer. With the relaxation of COVID and vaccinations, more people will be moving around both by car, truck, and hopefully by airplane. That should help in terms of crack as we move forward. Okay. Thank you. Our next question comes from the line of Paul Cheng with Scotiabank. Go ahead, please. Your line is open. Thank you. Good morning, guys. Hi, Paul. I'm just curious that when we're looking at that now, the renewable diesel plan budget you think is going to be at the high end of the range. What's the risk factor end up we may see much higher than the budget? If we recall, say, a number of years ago, when you did the major black wax expansion and upgrade in your Woods Cross, end up that the capital cost turned out to be much higher than the original budget. What's the risk factor here? How big is that risk? Secondly- Paul, you have a long memory, so I'll address that. Look, the risk factor, we provide a range for these capital projects, and as more engineering is completed, that range tends to narrow on a single number, leaving basically field construction as the principal risk factor for which we provide a contingent high end of our range as we've completed most of our engineering and are ready to basically start issuing what we call IFC ISOs. Basically, piping circuits for construction to start taking them out to the field. We're quite far along in terms of the engineering and initial phases of construction. We're getting more confident and at the same time narrowing our range, but at the higher end. If we want to contrast it to a project from years ago, the issue was simply the engineering wasn't done. Prior to making a finer point estimate and as the engineering evolved the project through. These projects are fairly distinct from that. We're following a stage gate process. We're really near to ordering. We've ordered all the heavy equipment, the major equipment, if you will, vessels, compressors, et cetera. We have fixed prices on all that. The engineering is largely complete, and what's in front of us is field construction. There's some risk around field construction during COVID. The COVID numbers are down, and that's good, and we've padded the estimates to reflect different practices to maintain a safe workforce. Okay. Second question is on the lubricant. After the last several years of the ownership, I think we have run through things like that from time to time. The rack forward looked really good and then rack back was challenging. In this quarter, the rack back finally is in break even and rack forward, on the other hand, margin go down. Are we still really truly believe this is a business that we can generate $250 million-$300 million in EBITDA? In hindsight, is that something that we have learned after the last several years that perhaps may be different than the original expectation to make you to either that more optimistic or more pessimistic about this business? Do we really have the necessary skill and the organization and the people to really make this as a profitable business for you? Yeah. The short answer is yes. We have a really talented team running this business, Paul. I think the big difference between expectations and reality through the last couple of years has been a commodity base oils business, that went through a deep recession, okay? When you get to Group I, Group II cracks versus vacuum gas oil of $10, $11 a barrel, that was not our expectation. That's not a healthy margin for the industry. The team that we have in place understands the business, is capable of growing the rack forward business, the finished lubricants and specialties business intelligently in the markets where we have advantage. The base oil piece appears to be more constructive now. That's going to be the commodity part of the business. It'll be more volatile through time. Today's dynamic is actually really favorable. I would guess I'd caveat it and say the base oils will be variable, and we'll continue to grow our effectiveness and margin in rack forward. I thought that Exxon is going to add a quite substantial sum of base oil, in a couple of years' time. I think we've seen that in broader PADD and on the Gulf Coast, Paul. What continues to come will depend on their own investment plans, but, for the time being, I think we're pretty stable. Mm-hmm. All right. Thank you. Our next question comes from the line of Phil Gresh with JP Morgan. Hi. Good morning. Thanks for taking my question. The first one is just on, if we look at refining and the capture rates there, any color you could share just on the impact of RINs, whether it's just kind of the ongoing expense effect or some kind of mark-to-market, obviously, RINs going up 4Q over 3Q, I'm sure impacted the capture rates there. What is your view about where RINs will go? I feel like we're getting the question a lot. Do you think, as renewable diesel starts up, that we start to see RINs prices dissipate later this year and into 2022? Hey, Phil. It's Rich. Let me do the capture impact. To be honest, it was not that big in the fourth quarter. Please keep in mind that we use a weighted average inventory cost methodology here, so our RIN cost will lag the spot market. Our RIN expense in the fourth quarter is about $40 million versus $34 million in the third quarter. Let me hand it to Tom and Tim to talk about the market outlook. Yeah, Phil, this is Tim. Let me just mention on the MidCon capture as well. We had a year-end revaluation cost that Mike mentioned in his opening remarks. That was $32.5 million, specifically in the MidCon, that impacted the gross margin. Translates to about $1.39 a barrel. Without that inventory valuation, the capture rate would've been 45% for the MidCon. The total of, what is that? $330, I think, on that, $332 on general gross margin. We also had some lower gasoline margins that further impacted the capture contribution in the MidCon. As you know, when cracks are lower, the percent of fixed costs tend to impact the capture rate more so than when cracks are higher. Those were the issues that were affecting the MidCon. On the west side, demand was more impacted in the fourth quarter by COVID, with the hotspots in that area, in the southwest area of the country. Gasoline margins were specifically impacted on margin contribution, probably more than normal. We also had higher laid-in crude costs that impacted the margin capture in the southwest. Phil, I get the dubious distinction of trying to figure out where RINs are going from here. Sorry. With declining gasoline demand, there is a fear in the marketplace that we're going to be short of reaching the 15 billion gallons of D6 RINs that are required. As a result, what's going to happen is that people are going to start using D4s to retire D6 obligations. We can see that in the marketplaces because D6s are climbing and getting closer to D6 all the time, that the spread is a lot less than it was before. That begs the question, well, what the hell's happening with D4s? That's a lot to do with rising soybean prices. The soybean price has been going up. What we've seen is on a bushel basis, it's gone from [$19.9] to $14 a bushel, that's basically because of China. As they replenish their pig population from the swine flu outbreak, they're having a higher demand of soybean. We're also seeing some weather impacting South American supply. Going forward, there's a lot of that is already baked into the market. Those are the main factors that driven the RIN price to where it is now. I think in the event that we get more gasoline demand and there's more D6 RINs generated as a result, what that's going to do is increase the supply and help temper the prices from going any further on the D6s. The D4s are just going to do their own thing, on the basis of the BOHO spread as it moves forward. That's going to be more of a relationship driven than a political decision at this point in time. I think we've seen big increases on the D6s and the D4s to date. I don't think we're going to see those kinds of increases as we go through the year as a lot of these factors are already built into the marketplace. Got it. I appreciate you taking a shot at that. Rich, just to clarify with the lag effect, do you have an estimate or expectation of if prices stay where they are, what the RINs expense would be in 1Q or 2021? No. It would trend higher as well, assuming, a lot of this revolves around volume and blend rate, but directionally, you would expect it to trend higher with higher spot prices. Okay. You gave the throughput for 1Q. Other companies have talked about OpEx headwinds from higher natural gas. Are you seeing any of those types of impacts on the refining side at this point? More muted for you guys, or just any color there would be helpful. Phil, this is Tim again. Our MidCon plants were actually in part of the coldest temperatures associated with Storm Uri and the polar vortex. Tulsa was already in planned maintenance. The storm effects will basically just extend the downtime that we had there a little bit longer. Other than that, the other plants had some individual unit outages that occurred. Two of the plants are completely back to normal, and the third one will be back to normal later this week. The guidance of 350,000 to 380,000 barrels a day that Mike mentioned in the prepared remarks reflect both the impact and the planned maintenance as well as the unplanned cold weather impacts. Would there be a specific natural gas price effects that you would anticipate as well? Not one that we'd call out, Phil. These were extreme spikes. They were very transitory. Nothing we'd offer now as guidance. Okay. Thank you. Our next question comes from the line of Theresa Chen with Barclays. Go ahead, please. Your line is open. Morning. Wanted to turn back to the LSP segment, and if you could share further in terms of details related to end market demand beyond what you're seeing in industrial and transportation. How is the personal care segment doing, and what is your outlook in terms of from here, what needs to happen for you to issue guidance again? Is it just a matter of volumes returning to a more normalized level? Is it something else? Any color there would be great. Good morning. In terms of the traditional demand markets for personal care, pharmaceutical, and those related food also type markets, demand is very robust. We have high asset utilization in both facilities. Actually, all three facilities making those products which encompass white oils, petrolatums, and waxes. Demand remains very robust and really was not heavily impacted by the COVID-19 in the same way that refined gasoline and diesel and so forth were. In terms of any questions related to guidance expectations, I would defer Rich to follow on. Not much to offer there, Theresa. As Bruce mentioned, things are getting better. I think kind of similar to what we're seeing everywhere. We expect it to get better as the coronavirus restrictions on the economy are lifted here. Got it. In terms of the weather impact, just following up on Phil's questioning. I don't believe Salt Lake was impacted, in particular, just from your earlier call on the midstream entity. The questions would be around what implications does that have on capture for that area if you were able to really increase throughput during that time and take advantage of the wider cracks? Yeah, Theresa, Salt Lake City was the least impacted in terms of temperature and impacts from the storm. Salt Lake City is running normal and will continue to see maybe a slightly stronger demand as a result of the storms, but it's probably isolated more so from the Gulf than probably what you're thinking. Yeah. Theresa, it's Rich. To Tim's point, when he said Salt Lake is impacted, the entire valley was unimpacted, right? There was really no market dynamic at work there, good or bad, frankly, from the storm. Thank you. Our next question comes from the line of Matthew Blair with Tudor, Pickering, and Holt. Go ahead, please. Your line is open. Hey, good morning, everyone. Could you talk about how construction is progressing on the renewable diesel side? Was it impacted by this winter storm? Exactly what are you thinking in terms of startup for, I guess the Artesia RD as well as the pretreatment unit? Good morning, Matthew, it's Tom. Looking at Cheyenne was in the middle of a Wyoming winter, and it wasn't much different than it is every other year up in Cheyenne, and it wasn't affected to any great degree by the polar vortex that hit the middle part of the country. Construction is going well. We are moving dirt. We're leveling for the rail facilities to go in. We've got a lot of the permits in place, so we don't expect any delays from that standpoint as we move forward on construction. Artesia, there again, there was some effects of the winter storm, but nothing major. We are proceeding with construction. Tanks are going up. Rail lines are going in. We're making good progress. We are on schedule. To your ultimate question, we don't see any deviations from meeting the schedule as previously released at this point in time. Sounds good. On the refining side, your West OpEx came in, I believe, at $97 million without Cheyenne. Is that a good run rate that we can roll forward into 2021? Yeah. We saw a little bit of a higher natural gas price in the fourth quarter than probably what we had seen in the third quarter. We had a few year-end accruals that hit us as we typically do at the end of the year. Maybe it was a little bit higher than what we'd normally see on a normal run rate basis. That's probably fairly close. Got it. Thank you very much. Our next question comes from the line of Doug Leggate with Bank of America. Go ahead, please. Hey, guys. Good morning. This is Kalei on for Doug. A lot has already been hit here. I've got a couple. As you guys thought about your renewable diesel sourcing strategy, I'm wondering if you've ever considered going upstream for feedstock, i.e., contracting the farming of your own plant-based feedstock, which would in turn insulate you guys from market-based pricing. If you guys have thought about that, what are the pros and cons? Yeah, this is Tom Creary. Quick answer is, yes, we have looked at going upstream. We've looked at crush plants and what involved in there, but we've basically stopped at that point in terms of soybean. I think it would be a stretch for us to get into farming or the rendering of cattle at this point in time. We don't want to go too far upstream, but like I said, we have looked at crush plants, and if that's going to be a constraint going forward, it would be something that we might invest in because it's part of the value chain in our business. Great. That's great. That's what we've looked at so far. Okay. Perfect. Can you also provide an update on the sustaining capital, including the renewable diesel plants? Kalei, generally sustaining capital, we continue to see that as, call it 175, $200 million a year across the Corporation with a lot of volatility, obviously driven by turnaround schedule. In a five-year cycle, that would probably be the average. The reality is the renewable diesel business will not add a lot in terms of sustaining capital. Turnaround costs there are relatively minor. You do have catalyst change-outs on a similar cycle to a refinery, but it doesn't look anything like a turnaround of fuels refinery. Got it. The $175-$200 includes turnaround, correct? Sorry, you're breaking up, Kalei. The $175 million-$200 million includes the turnaround, that's correct? Correct. Perfect. Thank you, guys. Again, as a reminder, if you would like to ask a question, please press star and then one on your telephone keypad. Our next question comes from the line of Jason Gabelman with Cowen. Go ahead please, your line is open. Yeah. Hey. Morning, everyone. Two questions. One just on the working capital benefit that you mentioned in Q4. What drove that? Is that a durable benefit or do you expect that to reverse over the course of 2021? The second question just on going back to the renewable diesel business. Is there a desire or an interest to sell some of the stake in the renewable diesel plants maybe as you get closer to completion just to kind of offset some of the capital costs and maybe that could be another angle to helping secure advantage feedstock? Thanks. Hey, Jason. It's Rich. Let me speak to working capital. In the fourth quarter, obviously we managed inventory really well and ran some barrels down. We had the tail end of Cheyenne inventories, which is a permanent reduction obviously. We'll continue to stay very vigilant given the macroeconomic situation and our cash flow on working capital realistically, right? Any rising crude price environment, you're going to see working capital benefit. We're optimistic about the economy, ergo, we would expect crude prices to rise and ergo we would expect to continue to see working capital benefit. Hey, Jason. On the renewable portfolio side. We're committed to building it out, developing this as a part of our company. At the same time, we're capitalists and we're conscious that these things trade at a high multiple. We're going to evaluate that through time. I think what we know to be fact is that we need to complete the projects, get them up and running and demonstrate the value before we have any real alternatives to separately recognize that value other than as a part of HollyFrontier Corporation. So for the time being, we're in the mode of building this business, building the commercial and supply chain aspects of it, and obviously securing feedstocks and markets, and we're really not spending any time looking to sell it at this point. Okay. Thanks for the answers. Yep. Our next question comes from the line of Neil Mehta with Goldman Sachs. Go ahead please, your line is open. Good morning, guys. First question is just around HEP and midstream and less about whether you want to fold this in and just more about the strategy around the midstream business over the next couple of years. Is the goal here to basically run the business for free cash flow, pay out the distribution, not necessarily focus on the top line? Do you see top-line opportunities here as well? Hey, Neil, it's Rich. I think we're in an interesting position right now in the midstream business and generally industry. Our near term, call it for the next 12-18 months focus here is getting the Cushing Connect Pipeline up and running and then continuing to de-lever to get to our leverage target of 3x to 3.5x. We think that's going to put us in a great position to have flexibility to either increase distributions, repurchase units, or if there are opportunities to grow the business, go ahead and pursue those. We'd like to grow the business. The reality, right, is the midstream space was incredibly frothy the last five years, and it feels like we're coming out of that. We're optimistic there'll be opportunity, but the good news is if there isn't, we don't see an opportunity to grow that creates unitholder value, we'll go ahead and increase distributions. Thanks, guys. The follow-up here might be for Tom, but just your outlook on key crude differentials. One, your perspective on Brent WTI. Do you see a path for this kind of sustaining in the $3-$4 level or do we need U.S. production as refining utilization comes back with demand as opposed to freeze offs? Thoughts on WCS where there are a number of competing forces between OPEC barrels coming back but also line of sight to pipes coming on. Yeah. On Brent WTI, Neil, I think what we're looking at is probably that $3-$3.50 in the short to medium term as we move forward. A lot of this is going to have to do not only on the Brent WTI differential, but on the WCS differential is what happens with OPEC and the quotas as we move forward. I guess our expectation is WCS differential is probably trading in the range of $11-$14 for the remainder of this year. Particularly what we've seen on WCS is we've seen the rise of rail movements out of Alberta in the fourth quarter and into the first quarter. That's going to put an artificial floor or real floor on differentials because of rail economics and getting it to the Gulf Coast. We still see pretty good demand numbers and pretty good delivered prices in the Gulf Coast, and that's partly due to the OPEC and Venezuela situation. That's what we're looking for as we move forward. Just to finish that off, on Midland and crude differentials, we see that continuing to trade over Cushing anywhere from $0.50 to $1.00 for the remainder of this year. Thank you so much, all. There are no further questions at this time. I'd like to turn the call back over to Michael Jennings for some final comments. Great. Thank you very much. Thank you all for, pardon me, participating with us this morning. In summary, HFC is really well equipped with its investment-grade balance sheet, $2.7 billion of standalone liquidity, and then really ready to stage a comeback in our core fuels business. Our Lubricants business continues to show strength and resiliency, has posted another solid quarter of earnings, and is operating really in a favorable base oils environment. Finally, we're progressing our renewables projects across the board, which are going to further diversify our asset base, strengthen our earnings power, and allow us to participate in a new and I think very lucrative market for the long term. Thanks for participating today. Look forward to talking to you soon. Thank you. This does conclude today's teleconference. Please disconnect your lines at this time and have a wonderful day.