HollyFrontier 2015 Annual Report Download - page 76

Download and view the complete annual report

Please find page 76 of the 2015 HollyFrontier annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 122

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122

Table of Contents HOLLYFRONTIER CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Continued
68
The carrying amounts and estimated fair values of investments in marketable securities, derivative instruments and senior notes
at December 31, 2015 and December 31, 2014 were as follows:
Fair Value by Input Level
Financial Instrument Carrying
Amount Fair Value Level 1 Level 2 Level 3
(In thousands)
December 31, 2015
Assets:
Marketable securities $ 144,019 $ 144,019 $ — $ 144,019 $ —
NYMEX futures contracts 3,469 3,469 3,469 — —
Commodity price swaps 37,097 37,097 — 37,097 —
HEP interest rate swaps 304 304 — 304 —
Total assets $ 184,889 $ 184,889 $ 3,469 $ 181,420 $ —
Liabilities:
Commodity price swaps $ 98,930 $ 98,930 $ — $ 98,930 $ —
HEP senior notes 296,752 295,500 — 295,500 —
HEP interest rate swaps 114 114 — 114 —
Total liabilities $ 395,796 $ 394,544 $ — $ 394,544 $ —
Fair Value by Input Level
Financial Instrument Carrying
Amount Fair Value Level 1 Level 2 Level 3
(In thousands)
December 31, 2014
Assets:
Marketable securities $ 474,110 $ 474,110 $ — $ 474,110 $ —
NYMEX futures contract 17,619 17,619 17,619 — —
Commodity price swaps 208,296 208,296 — 208,296 —
HEP interest rate swaps 1,019 1,019 — 1,019 —
Total assets $ 701,044 $ 701,044 $ 17,619 $ 683,425 $ —
Liabilities:
Commodity price swaps $ 196,897 $ 196,897 $ — $ 196,897 $ —
HollyFrontier senior notes 154,144 155,250 — 155,250 —
HEP senior notes 295,986 291,000 — 291,000 —
HEP interest rate swaps 1,065 1,065 — 1,065 —
Total liabilities $ 648,092 $ 644,212 $ — $ 644,212 $ —
Level 1 Financial Instruments
Our NYMEX futures contracts are exchange traded and are measured and recorded at fair value using quoted market prices, a
Level 1 input.
Level 2 Financial Instruments
Investments in marketable securities and derivative instruments consisting of commodity price swaps and HEP's interest rate swaps
are measured and recorded at fair value using Level 2 inputs. The fair values of the commodity price and interest rate swap contracts
are based on the net present value of expected future cash flows related to both variable and fixed rate legs of the respective swap
agreements. The measurements are computed using market-based observable inputs, quoted forward commodity prices with respect
to our commodity price swaps and the forward London Interbank Offered Rate (“LIBOR”) yield curve with respect to HEP's
interest rate swaps. The fair value of the marketable securities and senior notes is based on values provided by a third party, which
were derived using market quotes for similar type instruments, a Level 2 input.