Fiscal period ending 2025-12-31 versus 2024-12-31
— view filing on EDGAR →
Regulatory risk is the dominant escalation: proposed RFS Set II rules — with higher RVOs, a 50% RIN haircut on foreign feedstocks, and reduced equivalency values — combined with LCFS caps and Canadian protectionist measures, materially compress the economics of both the Refining and Renewable Diesel segments. Operational harm is no longer prospective: DGD's foreign feedstock supply has already been curtailed by tariffs, and Texas refineries face capital-intensive water challenges, while new project disclosures cite realized low-carbon failures and California enforcement exposure. Competitive, geopolitical, litigation, and cybersecurity risks each broadened in scope, producing a pervasive but sub-existential worsening across the risk profile.
5 company-specific
· 3 common-mode
Company-specific changes
Revised
Proposed RFS Set II rules introduce materially adverse changes: increased RVOs for 2026-2027, 50% reduction in RINs from foreign feedstocks, reduced equivalency values for biomass-based diesel/renewable diesel, and potential reallocation of SRE-exempted volumes. EPA explicitly states these could be "infeasible" and significantly impact Refining and Renewable Diesel segments. Combined with tariff impacts, LCFS caps, and Canadian protectionist measures, regulatory risk has substantially escalated.
We are subject to risks arising from the Renewable and Low-Carbon Fuel Programs, and other regulations, policies, international certifications, and standards impacting low-carbon fuels. As described…
Revised
New federal class-action lawsuit in California alleging antitrust and consumer protection claims related to LCFS compliance. Escalated litigation exposure with specific new material claim.
We are subject to risks arising from litigation, government action, and mandatory disclosure rules related to climate- and other sustainability-related matters, or aimed at the fossil fuel industry.…
Revised
Water supply added as material operational risk; Texas refineries experiencing ongoing water challenges requiring capital expenditures and additional costs.
We are subject to risks arising from the availability and prices of natural gas, electricity, and water. Our operations depend on the reliable supply of natural gas, electricity, and water. We…
Revised
Revised disclosure adds concrete impacts: DGD's foreign feedstock supplies already impacted by tariffs, reduced margins, curtailed production, and competitive disadvantages. Prior year was prospective; this year documents realized harm.
The availability and prices of our feedstocks and other critical supplies expose us to risks. We source our petroleum-based and low-carbon fuel feedstocks, as well as many other critical supplies…
Revised
Revised language escalates project risks: adds specific reference to recent low-carbon project failures, inflation impacts, portfolio optimization/asset divestitures, and California operations challenges with litigation and enforcement risks.
Our pursuit of capital and other strategic projects and actions exposes us to various risks. We engage in capital and other strategic projects based on many factors, including the forecasted project…
Also disclosed — common-mode (Geopolitical macro uncertainty, Generative AI competition disruption, AI cybersecurity escalation)
Geopolitical macro uncertainty
Revised
Expanded scope: added specific compliance risks (anti-bribery, FCPA), price controls, terrorist designations, Mexico judiciary/hydrocarbon changes, low-carbon fuel policies, de-globalization, and supply chain unreliability. Materially broadens disclosed geopolitical and regulatory exposures.
We are subject to risks arising from our operations and business activities outside of the U.S. We have operations and business activities, including marketing activities, outside of the U.S.…
Generative AI competition disruption
Revised
Added explicit risks: foreign dumping, autonomous driving, ethanol competition, and government support dependency. Escalates competitive and demand pressures.
Industry, market, and other developments could decrease the demand for our products. A reduction in the demand for our products could result from events and trends such as increases in fuel…
AI cybersecurity escalation
Revised
New explicit disclosure of AI-enabled threats and vendor AI platform risks escalates cybersecurity threat profile materially.
CYBERSECURITY AND PRIVACY RELATED RISKS We are subject to risks arising from a significant breach of our information systems. Our information systems and network infrastructure have been and continue…