HollyFrontier Corp.’s lubricants and specialty products segment reported large increases in income and revenue from operations, and Clean Harbors’ Safety-Kleen segment posted higher revenues and larger waste oil collection volumes for the third quarter.
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Dallas-based HollyFrontier Corp.’s lubricants and specialty products segment reported $62.4 million in income from operations for the quarter ending Sept. 30, a 43% improvement from $43.6 million in 2020’s third quarter. Revenues from external customers grew 47% to $666 million in the third quarter, up from $452.9 million.
The lubricants and specialty products segment includes Petro-Canada Lubricants and its refinery in Mississauga, Ontario, which makes such products as base oils, white oils, specialty products and finished lubricants, along with specialty lubricants from HollyFrontier’s Tulsa refineries. Acquired companies Red Giant Oil Co. and Sonneborn are also part of the company’s lubricants and specialty products segment.
“HollyFrontier’s standout third quarter results were driven by continued refined product margin strength in our regions, healthy base oil prices and robust operational performance in the quarter,” the company’s president and CEO, Michael Jennings, said in the earnings news release.
Clean Harbors’ Safety-Kleen sustainability solutions segment – which includes oil rerefining – reported $207.6 million in third-party revenues for the third quarter, a 63% jump from $127.6 million in the same period in 2020. These third-party revenues include sales of base oil, blended products and reclaimed fuel oil and a small amount of byproducts.
“Demand for our base and blended oil was high throughout the quarter, leading to a healthy pricing environment,” Alan McKim, Clean Harbors’ chairman, president and CEO, said in the Norwell, Massachusetts-based company’s earnings news release today. “Market conditions, including the underlying impact of IMO 2020, enabled us to deliver the widest re-refinery spread in our history. Waste oil collections were strong at 60 million gallons, up from 50 million a year ago.” The International Marine Organization’s 2020 maritime emissions regulations that took effect at the start of 2020 led much of the shipping industry to shift to low-sulfur fuel oils, in turn causing a transition from base number 70 or BN 100 grades cylinder oils to novel BN 40 products.
McKim said that within the Safety-Kleen sustainability solutions segment, the wide spread between used oil and base oil pricing has continued into the back half of the year, based on marketing conditions.