PBF Energy 2013 Annual Report Download - page 152

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PBF ENERGY INC. AND
PBF HOLDING COMPANY LLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)
F- 56
The Company also enters into economic hedges primarily consisting of commodity derivative contracts that are
not designated as hedges and are used to manage price volatility in certain crude oil and feedstock inventories as
well as crude oil, feedstock, and refined product sales or purchases. The objective in entering into economic hedges
is consistent with the objectives discussed above for fair value hedges. As of December 31, 2013, there were
43,199,000 barrels of crude oil and no barrels of refined products (9,234,000 and 1,310,000, respectively, as of
December 31, 2012), outstanding under short and long term commodity derivative contracts not designated as
hedges representing the notional value of the contracts.
The following tables provide information about the fair values of these derivative instruments as of December 31,
2013 and December 31, 2012 and the line items in the consolidated balance sheet in which the fair values are
reflected.
Description
Balance Sheet
Location
Fair Value
Asset/
(Liability)
Derivatives designated as hedging instruments:
December 31, 2013:
Derivatives included with inventory supply arrangement obligations Accrued expenses $ (177)
Derivatives included with the inventory intermediation agreement
obligations Accrued expenses $ 6,016
December 31, 2012:
Derivatives included with inventory supply arrangement obligations Accrued expenses $ 5,595
Derivatives included with the inventory intermediation agreement
obligations Accrued expenses $ —
Derivatives not designated as hedging instruments:
December 31, 2013:
Commodity contracts Accrued expenses $(19,421)
December 31, 2012:
Commodity contracts Accounts
receivable $ 1,431
The Company’s policy is to net the fair value of the derivatives included with inventory supply arrangement
obligations and inventory intermediation agreement obligations against the liabilities related to inventory supply
arrangements and inventory intermediation agreements with the same counterparty as the legal right of offset exists.