PBF Energy 2013 Annual Report Download - page 24

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As is the case with all companies engaged in industries similar to ours, we face potential exposure to future
claims and lawsuits involving environmental matters. These matters include soil and water contamination, air
pollution, personal injury and property damage allegedly caused by substances which we manufactured, handled,
used, released or disposed of.
Current and future environmental regulations are expected to require additional expenditures, including
expenditures for investigation and remediation, which may be significant, at our refineries and at our other facilities.
To the extent that future expenditures for these purposes are material and can be reasonably determined, these costs
are disclosed and accrued.
Our operations are also subject to various laws and regulations relating to occupational health and safety.
We maintain safety training and maintenance programs as part of our ongoing efforts to ensure compliance with
applicable laws and regulations. Compliance with applicable health and safety laws and regulations has required
and continues to require substantial expenditures.
In connection with each of our acquisitions, we assumed certain environmental remediation obligations. In
the case of Paulsboro, a trust fund established to meet state financial assurance requirements, in the amount of
approximately $12.1 million, the estimated cost of the remediation obligations assumed based on investigation
undertaken as of the acquisition date, was acquired as part of the acquisition. The short term portion of the trust
fund and corresponding liability are recorded as restricted cash and accrued expenses, the long term portion is
recorded in other assets and other long-term liabilities. In connection with the acquisition of Delaware City, the
prior owners remain responsible subject to certain limitations, for certain environmental obligations including
ongoing remediation of soil and groundwater contamination at the site. Further, in connection with the Delaware
City and Paulsboro acquisitions, we purchased two individual ten-year, $75.0 million environmental insurance
policies to insure against unknown environmental liabilities at each refinery. In connection with the acquisition of
Toledo, the seller, subject to certain limitations, initially retains remediation obligations which will transition to
us over a 20-year period. However, there can be no assurance that any available indemnity, trust fund or insurance
will be sufficient to cover any ultimate environmental liabilities we may incur with respect to our refineries, which
could be significant.
We cannot predict what additional health, safety and environmental legislation or regulations will be enacted
or become effective in the future or how existing or future laws or regulations will be administered or interpreted
with respect to our operations. Compliance with more stringent laws or regulations or adverse changes in the
interpretation of existing requirements or discovery of new information such as unknown contamination could
have an adverse effect on the financial position and the results of our operations and could require substantial
expenditures for the installation and operation of systems and equipment that we do not currently possess.
GLOSSARY OF SELECTED TERMS
Unless otherwise noted or indicated by context, the following terms used in this Annual Report on Form 10-
K have the following meanings:
“ASCI” refers to the Argus Sour Crude Index, a pricing index used to approximate market prices for sour,
heavy crude oil.
“Bakken” refers to both a crude oil production region generally covering North Dakota, Montana and
Western Canada, and the crude oil that is produced in that region.
“barrel” refers to a common unit of measure in the oil industry, which equates to 42 gallons.
“blendstocks” refers to various compounds that are combined with gasoline or diesel from the crude oil
refining process to make finished gasoline and diesel; these may include natural gasoline, FCC unit gasoline,
ethanol, reformate or butane, among others.
“bpd” refers to an abbreviation for barrels per day.