With refinery operations in Oklahoma, Kansas, New Mexico and Utah, Holly Energy Partners, L.P. announced improved net income of $64.4 million or 61 cents a basic and diluted limited partner unit while revenues declined in the first quarter 2021.
The $64.4 million in net income compared to $24.9 million in the first quarter of 2020 for the Dallas-based company. Distributable cash flow was $73.2 million for the quarter, an increase of $2.5 million, or 3.5% compared to the first quarter of 2020.
“During the quarter, refined product volumes improved and we are optimistic for continued improvement of refined product demand in our markets as we head into the summer driving season. Looking forward, we believe we are well positioned to continue reducing leverage after capital investments and distributions,” said Michael Jennings, Chief Executive Officer.
The company depends on the demand for various petroleum products that Holly Energy Partners transports, terminals and stores in its markets. The firm stated the COVID-19 pandemic created diminished demand for refined products and crude oil transportation but over the past three quarters, demand for transportation showed improvement over the second quarter of 2020.
Revenues for the first quarter were $127.2 million, a decrease of $0.7 million compared to the first quarter of 2020. The decrease was mainly due to a 9% reduction in overall crude and product pipeline volumes.
Holly Energy also reported its refined product pipelines revenues totaled $28.5 million, a decrease of $6.4 million compared to the first quarter of 2020. Shipments averaged 164,000 barrels a day compared to nearly 180,000 barrels a year earlier.
Revenues from its crude pipelines were $30.5 million, up $2.4 million from the first quarter of last year. The revenue increase was mainly attributable to higher volumes on our crude pipeline systems in Wyoming and Utah. Those volume increases were more than offset by decreased volumes on the company’s crude pipeline systems in New Mexico and Texas.
Holly’s refinery processing units had revenues of $22.5 million, an increase of $2.6 million from the previous year. Volumes averaged 60.7 nmbpd compared to 69.8 mbpd for the first quarter 2020. The drop in volume was largely due to extreme weather at the Woods Cross and El Dorado processing units where revenue increased because of the higher recovery of natural gas costs.
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