UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

Commission file number 001-13175

Securities registered pursuant to Section 12(b) of the Act:

The following table indicates the headings in the 20212023 Proxy Statement where certain information required in PartPART III of this Form 10-K may be found.

Copies of all documents incorporated by reference, other than exhibits to such documents, will be provided without charge to each person who receives a copy of this Form 10-K upon written request to Valero Energy Corporation, Attn: Secretary, P.O. Box 696000, San Antonio, Texas 78269-6000.

We are a Fortune 500 company based in San Antonio, Texas. Our corporate offices are at One Valero Way, San Antonio, Texas, 78249, and our telephone number is (210) 345-2000. We were incorporated in Delaware in 1981 under the name Valero Refining and Marketing Company. We changed our name to Valero Energy Corporation in 1997. Our common stock trades on the New York Stock Exchange (NYSE) under the trading symbol “VLO.”

We sell our products on a wholesale basis through an extensive rack marketing network. The principal purchasers of our products from terminal truck racks are available in print to any stockholder that makes a written request to Valero Energy Corporation, Attn: Secretary, P.O. Box 696000, San Antonio, Texas 78269-6000.wholesalers, distributors, retailers, and truck-delivered end users throughout the U.S., Canada, the U.K., Ireland, and Latin America.

We strivealso sell our products through bulk sales channels in the U.S. and international markets. Our bulk sales are made to managevarious petroleum companies, traders, and bulk end users, such as railroads, airlines, and utilities. Our bulk sales are distributed primarily via pipeline, ship, and barge to major tank farms and trading hubs.

We own logistics assets (crude oil pipelines, product pipelines, terminals, tanks, marine docks, truck rack bays, and other assets) that support our businessrefining operations. Demand for transportation fuels in Latin America is expected to responsibly meetcontinue to grow. To support our wholesale rack operations in Latin America, we have invested in or grown our access to terminals and transloading facilities in Mexico and Peru. Our U.S. Gulf Coast refineries are well positioned to support export growth to Latin America and other countries around the world’s demandworld.

DGD is a joint venture that we consolidate. We entered into the DGD joint venture in 2011 and it began operations in 2013. See Note 11 of Notes to Consolidated Financial Statements regarding our accounting for reliable and affordable energy and have made multibillion-dollar investments to develop and grow our low-carbonDGD. We operate DGD’s renewable diesel plants and ethanol businesses. These renewable fuels businesses have made us one of the world’s largest renewable fuels producers. Even so, we continually seek to find ways to reduce the environmental impact of all of our operations and improve our ESG practices.perform certain management functions for DGD as an independent contractor under an agreement with DGD.

Renewable FuelsDiesel Plants

DGD began an expansion of the DGD St. Charles Plant in 2019 and Opportunities,operations commenced in the fourth quarter of 2021. This expansion increased the DGD St. Charles Plant’s renewable diesel production capacity by approximately 410 million gallons per year, which, is alignedat that time, brought DGD’s renewable diesel production capacity to approximately 700 million gallons per year, and provided DGD with the main principles outlinedability to produce approximately 30 million gallons per year of renewable naphtha.

The DGD Port Arthur Plant, which has a production capacity of approximately 470 million gallons of renewable diesel and approximately 20 million gallons of renewable naphtha per year was commissioned and commenced operations in the recommendationsfourth quarter of 2022. DGD’s combined renewable diesel and renewable naphtha production capacities increased to approximately 1.2 billion gallons and 50 million gallons, respectively, per year.

On December 31, 2020.2022, we had 9,743 employees. These employees were located in the following countries:

We believe that having diverse employees and inclusive teams provides strengths and advantages for our success, and our board of directors (Board) and management team strive to promote and improve diversity and inclusion. Of our total employees as of December 31, 2022, approximately 30 percent of our global professional employees were female, 11 percent of our hourly employees were female, and 19 percent of total employees were female. Approximately 37 percent of our U.S. employees are distributed via pipeline systemsHispanic or Latino, Black or African American, Asian, American Indian or Alaskan Native, Native Hawaiian or Other Pacific Islander, or two or more races. We strive to recruit and retain diverse employees and foster a culture of inclusion through various third-party terminals in Southern California, Nevada,efforts, including targeted recruiting strategies aimed at improving our outreach to underrepresented groups and Arizona.educational and training programs on diversity-related topics, such as objective hiring and the advantages of diverse employees. We are also committed to hiring and retaining veterans and reservists of the U.S. armed forces, who represent 12 percent of our U.S. employees as of December 31, 2022.

We believe that safety and reliability are extremely important, not only for the protection of New Orleans alongour employees, communities, and to the Mississippi River. The refinery successfully commissionedcultural values we aspire to as a new alkylation unitcompany, but also for operational success, as a decrease in the fourth quarternumber of 2020. The refinery processes sour crude oilsemployee and other feedstocksprocess safety events should generally reduce unplanned shutdowns and increase the operational reliability of our refineries and plants. This, in turn, should also translate into gasolinea safer workplace with fewer environmental incidents and diesel. The refinery receives crude oil over docksstronger community relations. We strive to improve safety and has accessreliability performance by offering year-round safety training programs for our employees and contractors and by seeking to promote the Louisiana Offshore Oil Port. Finished products are shipped over these dockssame expectations and throughculture of safety. We also seek to enhance our Parkway pipelinesafety performance by conducting safety audits, quality assurance visits, and the Bengal pipeline, which ultimately provide access to the Plantationcomprehensive safety and Colonial pipeline networks.

finished products are deliveredcaregiver support networks (including an on-site child care center at our headquarters) and support for children and parents with disabilities, a company 401(k) matching program, various company-sponsored pension plans, on-site employee wellness centers (also available to local, mid-continent U.S.eligible dependents at our headquarters), tuition reimbursement programs, fitness center access or a stipend, and northeastern U.S. markets through various pipelines, including the Colonial and Explorer pipelines.employee recognition programs.

We offer a comprehensive training and development program for our employees in subjects such as engineering and technical excellence, safety, environmental, maintenance and machinery/equipment repair, ethics, leadership, and employee performance. We also require all employees to complete training on technical matters, such as cybersecurity and information technology security, and various compliance and corporate conduct matters, including business ethics, conflicts of interest, and anti-bribery and anti-corruption, among others. Our Texas City Refineryemployee development initiatives include customized professional and technical curriculums, efforts to engage our leadership in the employee’s development process, and providing employee performance discussions. We offer a robust virtual training curriculum, which allows for greater availability and access for employees located across our many facilities and enables just-in-time training.

We strive to promote the health and well-being of our employees and their families. Our Total Wellness Program serves as the umbrella program for all aspects of employee wellness and is located southeastthe program through which many of Houstonthe benefits referenced above are provided. The heart of our Total Wellness Program is the annual wellness assessment, which is intended to provide a detailed picture of an employee’s current health that may educate and inform health decisions by highlighting risk factors and providing information that can help save lives. Under our Total Wellness Program, educational sessions are also scheduled throughout the year on a variety of topics on health and finances. Our Total Wellness Program also supports the Houston Ship Channel. The refinery processes crude oils into gasoline, diesel,financial wellness of our employees through our financial benefit programs, depending on eligibility status and jet fuel. The refinery receives its feedstocks by pipelinework location.

We also offer a wide range of support to our employees through our confidential employee assistance program, helping employees and by ship or barge via deepwater docking facilities along the Houston Ship Channel. The refinery uses shipstheir families manage relationship challenges, counseling needs, and barges,substance abuse and recovery, as well as the Colonial, Explorer, and other pipelinesself-care programs for distributionvarious behavioral health challenges.

Our crude oil and other feedstocks are purchased through a combination of term and spot contracts. Our term supply contracts are at market-related prices and feedstocks are purchased directly or indirectly from various national oil companies as well as international and U.S. oil companies. The contracts generally

Marketing

We sell our gasoline and distillate products as well as other products, such as asphalt, lube oils, and natural gas liquids (NGLs), on a wholesale basis through an extensive rack marketing network. The principal purchasers of our refined petroleum products from terminal truck racks are wholesalers, distributors, retailers, and truck-delivered end users throughout the U.S., Canada, the U.K., Ireland, and Latin America.

We also sell our gasoline and distillate products as well as other products, such as asphalt, petrochemicals, and NGLs, through bulk sales channels in the U.S. and international markets. Our bulk sales are made to various oilpetroleum companies, traders, and bulk end users, such as railroads, airlines, and utilities. Our bulk sales are transporteddistributed primarily by pipelines, barges,via pipeline, ship, and tankersbarge to major tank farms and trading hubs.

Logistics

We own logistics assets (crude oil pipelines, refined petroleum product pipelines, terminals, tanks, marine docks, truck rack bays, and other assets) that support our refining operations. Demand for transportation fuels in Latin America is expected to continue to grow. To support our wholesale rack operations in Latin America, we have invested in or grown our access to terminals and transloading facilities in Mexico and Peru. Our U.S. Gulf Coast refineries are well positioned to support export growth to Latin America and other countries around the world.

Our Relationship with DGD

DGD is a joint venture that we consolidate. We entered into the DGD joint venture in 2011.2011 and it began operations in 2013. See Note 1311 of Notes to Consolidated Financial Statements which is incorporated herein by reference, regarding our accounting for DGD. We operate the DGD PlantDGD’s renewable diesel plants and perform certain management functions for DGD as an independent contractor under an agreement with DGD.

Renewable Diesel PlantPlants

DGD owns two renewable diesel plants. The first DGD Plantplant began operations in 2013 and is located next to our St. Charles Refinery in Norco, Louisiana, and its production capacity is 290 million gallons of renewable diesel per year. Renewable diesel is a low-carbon transportation fuel that is interchangeable with diesel produced from petroleum and is produced from rendered and recycled materials, including animal fats, used cooking oils, and other vegetable oils.

The DGD Plant receives renderedPlants receive waste and recycled materialsrenewable feedstocks primarily by rail, trucks, ships, and trucksbarges owned by third parties. DGD is party to a raw material supply agreement with Darling under which Darling is obligated to offer to DGD a portion of its feedstock requirements at competitivemarket pricing, but DGD is not obligated to purchase all or any part of its feedstock from Darling. Therefore, DGD pursues the lowest costmost optimal feedstock supply available. See Item 1A, “RISK FACTORS”—Risks Related

DGD began an expansion of the DGD St. Charles Plant in 2019 and operations commenced in the fourth quarter of 2021. This expansion increased the DGD St. Charles Plant’s renewable diesel production capacity by approximately 410 million gallons per year, which, at that time, brought DGD’s renewable diesel production capacity to Our Business, Industry,approximately 700 million gallons per year, and Operations—Our investments in joint ventures and other entities decrease ourprovided DGD with the ability to manage risk, and—Disruptionproduce approximately 30 million gallons per year of our abilityrenewable naphtha.

The DGD Port Arthur Plant, which has a production capacity of approximately 470 million gallons of renewable diesel and approximately 20 million gallons of renewable naphtha per year was commissioned and commenced operations in the fourth quarter of 2022. DGD’s combined renewable diesel and renewable naphtha production capacities increased to obtain crude oil, renderedapproximately 1.2 billion gallons and recycled materials, corn, and other feedstocks could adversely affect our operations, which are incorporated herein by reference.50 million gallons, respectively, per year.

Marketing

Ethanol Plants

Our ethanol business began in 2009 with the purchase of our first ethanol plants. We have since grown the business by purchasing additional ethanol plants. Our 1312 ethanol plants are located in the Mid-Continent region of the U.S., and they have a combined ethanol production capacity of 1.69approximately 1.6 billion gallons per year. Our ethanol plants are dry mill facilities that process corn to produce ethanol and various co-products, including livestock feed (dry distillers grains, or DDGs, and syrup), and inedible corn oil.

The following table presents the locations of our ethanol plants, their annual production capacities for ethanol (in millions of gallons) and DDGs (in tons), and their annual corn processing capacities (in millions of bushels).

We source our corn supply from local farmers and commercial elevators. We publish on our website a corn bid for local farmers and cooperative dealers to facilitate corn supply transactions. Our plants receive corn primarily byvia rail and truck.

Marketing

We sell our ethanol primarily to refiners and gasoline blenders under term and spot contracts in bulk markets such as New York, Chicago,in the U.S. Gulf Coast, Florida, and the U.S. West Coast. We also export our ethanol into the global markets. We distribute our ethanol primarily by rail (including(using some railcars owned by us), truck, ship, and third-party trucks, barges, and vessels.barge. We sell DDGs primarily to animal feed customers in the U.S., Mexico, and Asia, which are transporteddistributed primarily by third-partyvia rail, trucks,truck, ship, and vessels.barge.

Demand for gasoline, diesel, and asphalt is higher during the spring and summer months than during the winter months in most of our markets, primarily due to seasonal increases in highway traffic and construction. The demand for renewable diesel has not significantly fluctuated by season. Ethanol is primarily blended into gasoline, and as a result, ethanol demand typically moves in line with the demand for gasoline.

GOVERNMENT REGULATIONS

We incorporate by reference into this Item the disclosures on government regulations, including environmental regulations, contained in the following sections of this report:

Capital Expenditures Attributable to Compliance with Government Regulations. In 2020, our capital expenditures attributable to compliance with environmental regulations were $27 million, and they are currently estimated to be $13 million for 2021 and $24 million for 2022. The estimates for 2021 and 2022 do not include amounts related to capital investments at our refineries and plants that management has deemed to be strategic investments. These amounts could materially change as a result of governmental and regulatory actions. We have incurred significant capital expenditures in prior years to comply with government regulations; however, we do not believe that compliance

Compliance with government regulations, including environmental regulations, haddid not have a material effect on our capital expenditures in 2020,2022, and we currently do not expect that compliance with these regulations will have material effects on our capital expenditures in 2021.2023.

Because our business is heavily regulated, our costs for compliance with government regulations are significant and can be material, especially costs associated with environmental compliance programs, which are furtherthe Renewable and Low-Carbon Fuel Programs disclosed in Notes 2018 and 2119 of Notes to Consolidated Financial Statements, which are incorporated herein by reference.reference into this item.

HUMAN CAPITAL

We believe that our employees provide a competitive advantage for our success. We seek to foster a culture that supports diversity and inclusion, and we strive to provide a safe, healthy, and rewarding work environment for our employees with opportunities for professional growth and long-term financial stability.

Headcount

On JanuaryDecember 31, 2021,2022, we had 9,9649,743 employees. These employees were located in the following countries:

Safety

We believe that safety and reliability are extremely important, not only for the protection of our employees, communities, and to the cultural values we aspire to as a company, but also for operational success, as a decrease in the number of employee safety events and process safety events should generally reduce unplanned shutdowns and increase the operational reliability of our refineries and plants. This, in turn, should also translate into a safer workplace with fewer environmental incidents a safer workplace, lower environmental impacts, and betterstronger community relations. We strive to improve safety and reliability performance by offering year-round safety training programs for our employees and contractors and by seeking to promote the same expectations and culture of safety among all of our workers.safety. We also seek to enhance our safety complianceperformance by conducting safety audits, quality assurance visits, and comprehensive safety and risk assessments.assessments at our refineries and plants.

In assessingTo assess safety performance, we measure our annual total recordable incident rate (TRIR), which includes data with respect to our employees and contractors and is defined as the number of recordable injuries per 200,000 working hours. We also annually measure our Tier 1 Process Safety Event Rate, which is a metric defined by the American Petroleum Institute that looks atidentifies process safety events per 200,000 total employee and contractor working hours. We use these measures and believe they are helpful in assessing our safety performance because they evaluate performance relative to the numbers of hours being worked. These metrics are also used by others in our industry, which allows for a more objective comparison of our performance. In 2020, ourOur refinery employee and contractor TRIR for 2022 was 0.340.32 and 0.15, respectively, and our refinery Tier 1 Process Safety Event Rate for 2022 was 0.06. As a result, in 2020 we had one of our best years ever in terms of safety performance.0.08.

Compensation and Benefits

We believe that it is important to provide our employees with competitive compensation and benefits. The benefits we offer to employees, depending on work location and eligibility status, include, among others, healthcare plans that are generally available to all employees, extended sick leave, new-parent leave, access to financial planning, programs to support dual workingdual-working parents at different stages of their careers,

caregiver support networks (including an on-site child care center at our headquarters) and support for children and parents with disabilities, a company 401(k) matching program, avarious company-sponsored pension plan,plans, on-site employee wellness centers (also available to eligible dependents at our headquarters), tuition reimbursement programs, fitness center access or a stipend, and employee recognition programs.

We believe that it is important to reward employee performance and have an annual bonus program that rewards achievements of various operational, financial, and strategic objectives. While such objectives include more typical financial performance metrics, such as earnings per share and cash operating expenses, we believe ESG performance is also important and our annual bonus program rewards achievements in areas such as sustainability, diversity and inclusion, environmental stewardship, compliance, corporate citizenship, and corporate citizenship.community.

Training and Development

We offer a comprehensive training and development program for our employees in subjects ranging fromsuch as engineering and technical excellence, safety, environmental, maintenance and machinery/equipment repair, to ethics, leadership, and employee performance. We also require all employees to complete training on technical matters, such as cybersecurity and information technology security, and various compliance and corporate conduct matters, including business ethics, conflicts of interest, and anti-bribery and anti-corruption, among others. Our employee development initiatives include customized professional and technical curriculums, efforts to engage our leadership in the employee’s development process, and providing employee performance discussions. We offer a robust virtual training curriculum, which allows for greater availability and access for employees located across our many facilities and enables just-in-time training.

Wellness

We strive to promote the health and well-being of our employees and their families. Our Total Wellness Program serves as the umbrella program for all aspects of employee wellness and is the program through which many of the benefits referenced above are provided. The heart of our Total Wellness Program is the annual wellness assessment, which is intended to provide a detailed picture of an employee’s current health that may educate and inform health decisions by highlighting risk factors and providing information that can help save lives. A few of the many resources provided with this annual assessment may include a body composition analysis, an online nutritional analysis, lab work, and a sleep analysis. Under our Total Wellness Program, educational sessions are also scheduled throughout the year on a variety of topics on health and finances. Our Total Wellness Program also supports the financial wellness of our employees through our financial benefit programs, depending on eligibility status and work location.

We are also proud to offer no-cost assistance and a wide range of support to our employees through our confidential employee assistance program, helping employees and their families manage relationship challenges, counseling needs, and substance abuse and recovery, as well as self-care programs for various behavioral health challenges. In addition, during times of crisis (such as the COVID-19 pandemic), certain of our benefit partners offer toll-free, 24-hour access to emotional support help lines.

PROPERTIES

Our principal properties are described in “OUR OPERATIONS” above under the caption “VALERO’S OPERATIONS,” and that information is incorporated herein by reference.reference into this item. We believe that our properties are generally adequate for our operations and that our refineries and plants are maintained in a good state of repair. As of December 31, 2020,2022, we were the lessee under a number of cancelable and noncancelable leases for certain properties. Our leases are discussed in Note 64 of Notes to Consolidated Financial Statements, which is incorporated herein by reference.reference into this item. Financial information about our properties is presented in Note 75 of Notes to Consolidated Financial Statements, which is incorporated herein by reference.reference into this item.

You should carefully consider the following risk factors in addition to the other information included in this report. Each of these risk factors could adversely affect our business, operatingfinancial condition, results of operations, and/or financial condition,liquidity, as well as adversely affect the value of an investment in our common stock or debt securities.

Some of these factors can vary by region and may change quickly, adding to market volatility, while others may have longer-term effects. The longer-term effects of these and other factors on product margins are uncertain. We do not produce crude oil, waste and renewable feedstocks, corn or all of our other primary feedstocks and must purchase nearly all of the feedstocks we process. We generally purchase our feedstocks long before we process them and sell the resulting products. Price level changes during the period between purchasing feedstocks and selling the resulting products has had, and in the future could continue to have, a significant effect on our financial results. A decline in market prices as was experienced during much of 2020, negatively impacted,has had and may continuecould again have a negative impact to negatively impact, the carrying value of our inventories.

Economic turmoiluncertainty, inflation, cybersecurity incidents, and political unrest or hostilities, including the threat of future terrorist attacks, could affect the economies of the U.S. and other countries. Lower levels of economic activity could result in declines in energy consumption, including declines inreduce the demand for and consumption of our products, which could cause our revenues and margins to decline, and limit our future growth prospects.prospects and affect our capital allocation decisions. Inflation could negatively impact our operating costs and increased product prices could result

in demand destruction. Refining, renewable diesel, and ethanol margins also can be significantly impacted by additional conversionchanges in the worldwide production capacity throughof such products, whether due to the expansion, closure, or transition of existing facilities, or the construction of new refineries or plants. Worldwide refiningfacilities, and those product margins will be adversely affected if the worldwide production capacity expansions may result in refining production capability exceeding refined petroleum product demand, which would have an adverse effect on refining margins.for such products exceeds demand.

Many state, provincial, and national governments across the world have imposed, and may impose in the future, increases in fuel economy standards, low-carbon fuel standards, restrictions on vehicles using petroleum-based fuel, and other policies or regulations (such as tax incentives or subsidies) aimed at steering the public towards less petroleum-dependent modes of transportation, which could reduce demand for our products. For example, in September 2020 the governor of California issued an executive order seeking to require that sales of all new passenger vehicles be zero-emission by 2035 and medium to heavy duty vehicles be zero-emission by 2045 where feasible. The executive order also requires state agencies to build out sufficient electric vehicle charging infrastructure. Other governmental authorities, such as the U.K. and Quebec, have also announced intentions to adopt similar restrictions with respect to the sale of new combustion-engine vehicles. A reduction in the demand for our products could also result from a shifttransition by consumers to alternative fuel vehicles, such as electric vehicles (EVs) and hybrid vehicles, whether as a result of technologicalgovernment mandates or scientific advances,incentives, industry developments, or consumer or investor sentiment towards our productsfossil fuels and their relationship to the environment,GHG emissions. New developments may make alternative fuel vehicles more affordable or legislation or regulation mandating or encouraging the usedesirable, including improvements in battery and storage technology, increases in driving ranges, increased availability of charging stations and other infrastructure, expanded and more reliable supply chains, increased inventory, and improvements in hydrogen fuel cell technology. Any such developments could increase consumer acceptance and result in greater market penetration of alternative energy sources. It is not possible at this time to predict the ultimate form, timing, or extent of any such governmental, consumer, or investor actions. However, a reduction in the demand for our products as a result of any of the foregoing events could materially and adversely affect our business, financial condition, results of operations, and liquidity.fuel vehicles.

There have been efforts inIn recent years, whicha number of advocacy groups, both in the U.S. and internationally, have intensified during the COVID-19 pandemic, aimedcampaigned for government and private action to promote climate and other ESG-related change, particularly at thepublic companies, through investment community, includingand voting practices of investment advisors, sovereign wealth funds, public pension funds, universities,endowments, and other groups, to promotestockholders. These activities have included promoting the divestment of securities of energyfossil fuel companies as well as to pressureand pressuring lenders, insurers, and other financial services companies to limit or curtail activities with energyfossil fuel companies. As a result, some financial intermediaries, investors, and other capital markets participants have reduced or ceased lending to, or investing in, or insuring companies that operate in industries with higher perceived environmental exposure, such as the energyfossil fuel industry. For example, in December 2020, the state

Responding to such ESG-focused activism has been and will likely continue to be costly and time-consuming. Such response efforts could also result in the implementation of certain ESG practices or disclosures that may present a heightened level of legal and regulatory risk, or that threaten our credibility with other investors and stakeholders. The methodologies and standards for tracking and reporting on ESG matters are relatively new, have not been standardized, and continue to evolve. As a result, our ESG-related disclosures, metrics, and targets may not necessarily be calculated in the same manner or comparable to similarly titled measures presented by us in other contexts, or by other companies suchor third-party estimates. While we believe that our ESG disclosures and methodologies reflect our business strategy and are reasonable at the time made or used, as ours forour business or applicable methodologies, standards, or regulations develop and evolve, we may revise or cease reporting or using certain disclosures and methodologies if we determine that they are no longer advisable or appropriate. If our ESG performance before investingdisclosures and methodologies are or are perceived by government authorities, investors, or stakeholders to be inadequate, inaccurate, or non-compliant with applicable standards or regulations, or if we discover material inaccuracies therein, our reputation could be negatively impacted, and we could be exposed to litigation and other regulatory actions.

Some capital markets participants are increasingly using ESG as a factor in their assessments, which could impact our common stockcost of capital or debt securities, or lendingaccess to us. Over the past few years therefinancing. There has also been an acceleration in investor demand for ESG investing opportunities, and many large institutional investors have committed to increasing the percentage of their portfolios that are allocated towards ESG-focused investments. As a result, there has been a proliferation of ESG-focused investment funds and market participants seeking ESG-oriented investment products.

A significant portion ofWe source our refining feedstock requirements is satisfied through supplies originating inthroughout the Middle East, Africa, Asia, North America, and South America.world. We are, therefore, subject to the political, geographic, and economic risks attendant to doing business with suppliers located in, and supplies originating from, thesediverse areas. If one or more of our supply contracts were terminated, or if political or other events were to disrupt our traditional feedstock supply, we believe that adequate alternative supplies would be available, but it is possible that we would be unable to find adequate or optimal alternative sources of supply. Our refineries and plants without access to waterborne deliveries or offtake must rely on rail, pipeline, or ground transportation and thus may be more susceptible to such risks. If we are unable to obtain adequate or optimal volumes or are able to obtain such volumes only at unfavorable prices, our business, financial condition, results of operations, and liquidity could be materially adversely affected, including from reduced sales volumes of products or reduced margins as a result of higher costs.

(such as in response to the Russia-Ukraine conflict) have impacted and may continue to impact trade flows, and have limited and may continue to limit our ability to gain access to business opportunities in various countries. Actions by both the U.S. and other countries have affected our operations in the past and will continue to do so in the future.

WhileAlthough Darling, ourthe other joint venture partnermember in DGD, supplies some of DGD’s waste feedstock at competitive pricing, DGD must still secure a significant amount of supplyits waste and renewable feedstock requirements from other sources. Should Darling’s supply be disrupted or should supply from other sources become limited or only available aton unfavorable terms, DGD could be required to develop alternate sources of supply. Whilesupply, and it could be required to increase its utilization of waste and renewable feedstocks that produce lower margin products. As the volume of renewable diesel produced continues to increase, the competition for waste and renewable feedstocks will likely increase, which could place downward pressure on the margins associated with our Renewable Diesel segment’s products. DGD does not believewill also likely be required to satisfy a greater amount of its waste and renewable feedstock supplies from international sources as the competition for these feedstocks continues to increase, which would increase its exposure to the political, geographic, regulatory, and economic risks attendant to doing business with suppliers located in, and supplies originating from, such areas. Should DGD’s feedstock supply is likely to be disrupted, such an event could have an adverseadversely impact on DGD’s,its and therefore our business, financial position,condition, results of operations, and liquidity.

WeIn addition to our own logistic assets, we use the services of third parties to transport feedstocks to our refineries and plants and to transport theour products we manufacture to market. If we experience prolonged interruptions of supply or increases in costs to deliver our products to market, or if the ability of the pipelines, vessels, trucks, or railroadslogistics assets used to transport our feedstocks or products is disrupted because of weather events, water levels of key waterways for trade, rail disruptions, cybersecurity incidents, accidents, derailments, collisions, fires, explosions, governmental regulations,spills, public health crises, hostilities, or other government or third-party actions (including protests), it could have a material adverse effect on our business, financial position,condition, results of operations, and liquidity.

The refining and marketing industry is highly competitive with respect to both feedstock supply and refined petroleum product markets. We compete with many companies for available supplies of crude oil and other feedstocks, and for third-party retail sitesoutlets for our refined petroleum products. We do not produce any of our crude oilprimary feedstocks and we do not have a company-owned retail network. ManySome of our competitors, however, obtain a significant portion of their feedstocks from company-owned production and some have extensive networks of retail sites. Such competitors are at times able to offset losses from refiningliquid transportation fuels production operations with profits from producing or retailingsuch other operations, and they may be better positioned to withstand periods of depressed refiningproduct margins or feedstock shortages.

Our refineries, renewable diesel plant,plants, and ethanol plants are our principal operating assets. As a result, ourassets and are subject to planned and unplanned downtime and interruptions. Our operations could also be subject to significant interruption if one or more of our refineries or plants were to experience a major accident or mechanical failure, be damaged by severe weather or other natural disasters (such as hurricanes) or man-made disaster, suchdisasters (such as an actcybersecurity incidents or acts of terrorism,terrorism), or otherwise be forced to shut down.down or curtail operations. If any refinery or plant, or related pipeline or terminal, were to experience an interruption in operations, our earnings from the refinery or plant could be materially and adversely affected (to the extent not recoverable through insurance) because of lost productionproductivity and repair and other costs. Significant interruptions in our refining, renewable diesel, or ethanol systemsoperations could also lead to increased volatility in prices for crude oil, rendered and recycled materials, corn,the price of our feedstocks and many of our products. We have experienced certain of these events in the past, and although we focus on maintaining safe, stable, and reliable operations, we may experience additional events in the future.

We may engage in capital projects based on the forecasted project economics, political and level ofregulatory environments, and the expected return on the capital to be employed in the project.employed. Large-scale projects take many years to complete, during which time the political and regulatory environment or other market conditions canmay change from our forecast. Supply chain disruptions may also delay projects or increase the costs associated therewith. As a result, we may be unable tonot fully realize our expected returns, which could negatively impact our business, financial condition, results of operations, and cash flows.liquidity.

We conduct some of our operations through joint ventures in which we may share control over certain economic, legal, and business interests with ourother joint venture partners.members. We also conduct some of our operations through entities in which we have a minority or no ownership. Ourequity ownership interest, such as the variable interest entities (VIEs) described in Note 11 of Notes to Consolidated Financial Statements. The other joint venture partnersmembers and the third-party equity holders of the VIEs may have economic, business, or legal interests, opportunities, or goals that are inconsistent with or different from our opportunities, goals, and interests, or may have different liquidity needs or financial condition characteristics than our own, be subject to different legal or contractual obligations than we are, or be unable to meet their obligations. For instance,example, while we operate the DGD PlantPlants and perform certain day-to-day operating and management functions for DGD as an independent contractor, we do not have full control with respect toof every aspect of DGD’s business and certain large actionssignificant decisions concerning DGD, including, among others, the acquisition or disposition of assets above a certain value threshold, making certain changes to DGD’s business plan, raising debt or equity capital, DGD’s distribution policy, and entering into particular transactions, which currentlyalso require certain approvals from Darling. Additionally, although we consolidate certain VIEs, we do not have full control of every aspect of these VIEs, or the actions taken by their third-party equity holders, some of which may affect our business, legal position, financial condition, results of operations, and liquidity. Failure by us, or an entity in which we have a joint venture interest, or the VIEs to adequately manage the risks associated with joint ventures,such entities, and any differences in views among us and ourother joint venture partners, whichmembers or the third-party equity holders in the VIEs, could prevent or delay actions that are in the best interest of us, or the joint venture, or the VIE, and could have a material adverse effect on our or our joint ventures’, financial position,condition, results of operations, and liquidity.

We currently use commodity derivative instruments, and we expect to continue their use in the future. If the instruments we use to hedge our exposure to various types of risk are not effective or increase our exposure to unexpected events or risks, we may incur losses. In addition, we may be required to incur additional costs in connection with any future regulation of derivative instruments to the extent it is applicable to us.

These actions have contributed to a number of U.S. federal rulemakings aimed at regulating transportation GHG emissions, many of which ignore or downplay the full life cycle carbon footprint of EVs, and thereby seek to inappropriately advantage them over internal combustion engine vehicles. For example, in December 2021, the EPA finalized its “Revised 2023 and Later Model Year Light-Duty Vehicle Greenhouse Gas Emission Standards,” revising the GHG emissions standards for light-duty vehicles for 2023 and later model years at a level that cannot be achieved by internal combustion engine vehicles through improvements in combustion efficiency. The National Highway Traffic Safety Administration also finalized a rule in May 2022 increasing the corporate average fuel economy and carbon dioxide standards for certain passenger cars and light-duty trucks such that automakers cannot demonstrate compliance without increasing the use of EVs. Together, these federal regulations seek to increase the market penetration of EVs and other alternative fuel vehicles, such that these vehicles would be expected to comprise 17 percent of model year 2026 passenger vehicle sales. The EPA states that its final rule is projected to reduce gasoline consumption by more than 360 billion gallons by 2050, reaching a 15 percent reduction in annual U.S. gasoline consumption in 2050. Moreover, the EPA has indicated that it intends in the near future to pursue more stringent GHG emissions standards for model year 2027 and later passenger vehicles and to seek GHG emissions reductions for medium and heavy-duty vehicles pursuant to its “Clean Truck Plan.” Additionally, in July 2022, the Federal Highway Administration proposed rules that would require certain U.S. state departments of transportation and metropolitan planning organizations to establish declining carbon dioxide emissions targets for motor vehicle tailpipe carbon dioxide emissions that align with the current administration’s net-zero targets. The IRA, which was

passed in August 2022, also includes substantial subsidies to promote EVs and other alternative fuel vehicles.

Moreover, in 2005, the Kyoto Protocol to the 1992 United Nations (U.N.) Framework Convention on Climate Change, which establishes a binding set of GHG emissions targets, became binding on all countries that had ratified it. In 2015, the U.N. Climate Change Conference in Paris resulted in the creation of the Paris Agreement, which requires countries to review and “represent a progression” in their nationally determined contributions, which set emissions reduction goals every five years beginning in 2020. The terms of the Paris Agreement and the other executive orders and regulations discussed above are expected to result in additional regulatory actions, which could have a material adverse effect on our business. Incentives to conserve energy or use alternative energy sources in many locations where we currently operate, or may operate in the future, could negatively impact our business. Government authorities across the world are also considering, or have announced, profits or windfall taxes or penalties on fossil fuel companies, or have announced or imposed GHG emissions fees or changes that are adverse to refinery operations. For example, in environmental laws, includingSeptember 2022, the EU passed legislation imposing a profits tax and penalty on certain fossil fuel companies, and similar taxes and penalties have been proposed in California.

These and other legal, political, regulatory, and international accord matters and developments regarding climate change, GHG or other air emissions, fuel efficiency, or the environment, including executive orders that mandate or encourage the use of electric, hybrid, and other alternative fuel vehicles or discourage or ban the use of internal combustion engine vehicles, may increase consumer preferences for, and adoption of, alternative fuel vehicles and decrease demand for our liquid fuels. These legal, political, and regulatory developments, as well as other similarly focused laws and regulations, such as, among others, the California and Quebec cap-and-trade programs, the U.K. Emissions Trading Scheme, the U.K. Renewable Transport Fuel Obligation, the South Coast Air Quality Management District’s Rule 1109.1 – Emissions of Oxides of Nitrogen from Petroleum Refineries and Related Operations, CARB’s Control Measure for Ocean-Going Vessels At Berth Rule, reductions in the National Ambient Air Quality Standards, bans or restrictions on certain chemicals or processes, and other laws related to climate, changeGHG emissions, environmental, health, or safety matters could result in increased costs and capital expenditures, among other impacts, to (i) operate and maintain our facilities, (ii) install new emission controls at our facilities, and (iii) administer and manage any emissions or blending programs, including obtaining emission credits, allowances, or allotments. Such risks are particularly acute in California due to the pace and scope of anti-fossil fuel developments there.

Many of these legal, political, regulatory, and international accord matters and developments are subject to considerable uncertainty due to a number of factors, including technological and economic feasibility, legal challenges, and potential changes in law, regulation, or policy, and it is not currently possible to predict the ultimate effects of these matters and developments on us. However, a reduction in the demand for our products or an increase in costs or capital expenditures as a result of any of the foregoing events could materially and adversely affect our business, financial condition, results of operations, and liquidity. Such events could cause us to make changes with respect to our business plan, strategy, operations, and assets, that may impact our business and financial performance, including our current financial and accounting estimates and assumptions, and could result in negative publicity and litigation, which could materially and adversely affect our business, financial condition, results of operations, and liquidity.

Our operations are subject to extensive environmental, health, and safety laws and regulations, including those relating to the discharge of materials into the environment, waste management, pollution prevention measures, GHG emissions, and characteristics and composition of fuels, including gasoline and diesel.fuels. Certain of these laws and regulations could impose obligations to conduct assessment or remediation efforts at our refineries and plants, as well as at formerly owned properties or third-party sites where we have taken wastes for disposal or where our wastes may have migrated. The principal environmental risks associated with our operations are emissions into the air, handling of waste, and releases into the soil, surface water, or groundwater. Environmental laws and regulations also may impose liability on us for the conduct of third parties or for actions that complied with applicable requirements when taken, regardless of negligence or fault. If we violate or fail to comply with these laws and regulations, we could be fined or otherwise sanctioned.

We could also face increased climate‐related litigation with respect to our operations, disclosures, or products. GovernmentalGovernments and other entities in various U.S. states such as California and New Yorkprivate parties across the world have filed lawsuits or initiated regulatory action against coal, gas, oil,fossil fuel companies. Such lawsuits and petroleum companies. The lawsuitsactions often allege non-compliance with applicable laws or

regulations, or damages as a result of climate change, and the plaintiffs seek damages andand/or abatement under various tort and other theories. Similar lawsuits and regulatory actions may be filedbrought in these and other jurisdictions. While weGovernments and private parties are currently not a partyalso increasingly filing lawsuits or initiating regulatory action based on allegations that certain public statements and disclosures by companies regarding climate change and other ESG matters are false and misleading “greenwashing” that violate deceptive trade practices, consumer protection statutes, or other similar laws and regulations, or are fraudulent or misleading under applicable corporate, securities, stock exchange, or other similar laws and regulations. Similar issues can also arise relating to any of these lawsuits, theyaspirational statements such as net-zero or carbon neutrality targets that are made without an adequate basis to support such statements. Such suits or actions present a high degree of uncertainty regarding the extent to which energyfossil fuel companies face an increased risk of liability stemming from climate change or other ESG matters.

In addition to voluntary disclosures in response to investor and stakeholder requests, many governments have also proposed or adopted regulations that impose disclosure obligations with respect to various climate change and other ESG matters. For example, in March 2022, the SEC proposed sweeping and novel disclosure obligations with respect to climate change and GHG emissions reporting for U.S. publicly-traded companies. Also, in November 2022, various U.S. federal agencies jointly proposed an amendment to the Federal Acquisition Regulation that would require government contractors to publicly disclose their GHG emissions, respond to a climate disclosure questionnaire, and set and disclose GHG emissions reduction goals, in each case based on or utilizing specified private third-party frameworks or standards that have not been widely adopted. Other countries where we operate or do business, such as the U.K., have also recently passed laws requiring, or announced their intention to mandate, various climate disclosures and targets by companies. Some governments have also adopted regulations, or are launching investigations and requesting information, based on pricing practices in the fossil fuel industry. For example, in September 2022, California adopted the Oil Refinery Cost Disclosure Act (SB 1322), which will require refineries in California to report monthly on the volume and cost of the crude oil they buy, the quantity and price of the wholesale gasoline they sell, and the gross gasoline margin per barrel, among other information, some or all of which data could become publicly available. Our efforts to comply with these and other requests and regulations could subject us to risk would also adversely impactby requiring disclosure of information that (i) is protected trade secrets and/or competitively sensitive information, (ii) exposes us to litigation and government investigations related to anti-trust laws or other applicable pricing or non-disclosure laws or obligations, (iii) is inconsistent with other government regulations or our current disclosures that may utilize different methodologies or standards, and (iv) can be used to advance agendas that disfavor the oil and gasfossil fuel industry.

The previous U.S. presidential administration questioned certain existing and proposed trade agreements. For example, thethat administration withdrew the U.S. from the Trans-Pacific Partnership. In addition, the previousthat administration implemented and proposed various trade tariffs, which have resulted in foreign governments responding with tariffs on U.S. goods.

We are subject to extensive tax liabilities imposed by multiple jurisdictions, including income taxes, indirect taxes (excise/duty, sales/use, gross receipts, and value-added taxes (VAT))taxes), payroll taxes, franchise taxes, withholding taxes, and ad valorem taxes. New tax laws and regulations and changes in

Our information technology systems and network infrastructure may be subject to unauthorized access or attack which(and we are frequently subject to such attempts), including ransom-related incidents that could result in (i) a loss of intellectual property, proprietary information, or employee, customer or vendor data; (ii) public disclosure of sensitive information; (iii) increased costs to prevent, and be prepared to respond to or mitigate cybersecuritysuch events, such as deploying additional personnel and protection technologies, training employees, and engaging third-party experts and consultants;consultants. Such events could also result in (i) a loss of intellectual property, proprietary information, or employee, customer, supplier, or vendor data, (ii) public disclosure of sensitive information, (iii) systems interruption, (iv) systems interruption; (v) disruption of our business operations; (vi)operations, (v) remediation costs forand repairs of system damage; (vii)damage, (vi) reputational damage that adversely affects customer, supplier, or investor confidence;confidence, and (viii)(vii) damage to our competitiveness, stockthe price of our securities, and long-term stockholder value. A breach could also originate from or compromise our customers’ and, vendors’, suppliers’, or other third-party networks outside of our control.control that could impact our business and operations, as occurred with the Colonial Pipeline cybersecurity incident in May 2021. Although we implement stringent controls on third-party connectivity to our systems, we have limited control over ensuring their systems consistently enforce strong cybersecurity controls. Increased risks of such attacks and disruptions also exist because of the continuing Russia-Ukraine conflict. A breach may also result in legal claims or proceedings against us by our shareholders,stockholders, employees, customers, vendors, and governmental authorities (U.S. and non-U.S.).government authorities. There can be no assurance that our current or future infrastructure protection technologies and disaster recovery plans can prevent a technology systems breachsuch breaches, cyber, and ransom-related incidents, or systems failure,failures, any of which could have a material adverse effect on our business, financial position orcondition, results of operations. Furthermore, theoperations, and liquidity. The continuing and evolving threat of cyberattackscybersecurity incidents has also resulted in increased regulatory focus on prevention. Toprevention and disclosure, such as the extent we face increased regulatory requirements, wedirective issued by the U.S. Transportation Security Administration following the Colonial Pipeline cybersecurity incident, the obligations imposed by the U.S. Cyber Incident Reporting for Critical Infrastructure Act adopted in March 2022, and the SEC’s proposed cybersecurity disclosure rule. We may be required to expend significant additional resources to meetcomply with such requirements.laws and regulations, incur fines for noncompliance, and otherwise be exposed to litigation and regulatory action as a result thereof.

Along with our own data and information in the normal course of our business, we collect and retain certain data that is subject to specific laws and regulations. The transfer and useprocessing of this data both domestically and transferring of this data across international borders is becoming increasingly complex. This data is subject to governmental regulation at the federal, state, international, provincial, and localvarious levels of government in many areas of our business and in jurisdictions across the world, including data privacy and security laws such as the California Consumer Privacy Act (CCPA), the California Privacy Rights Act (CPRA), the EU General Data Protection Regulation (GDPR), the U.K. and General Data Protection Regulation (U.K. GDPR), the standard contractual clauses (SCC) recently adopted by the European Commission and the California Consumer Privacy Act (CCPA).

Our ability to obtain credit and capital depends in large measure on capital markets and liquidity factors that we do not control. Our ability to access credit and capital markets may be restricted at a time when we would like, or need, to access those markets, which could have an impact on our flexibility to react to changing economic and business conditions. In addition, the cost and availability of debt and equity financing may be adversely impacted by rising interest rates, inflation, unstable or illiquid market conditions. Protracted uncertainty and illiquidityconditions, or adverse changes in these markets also could have an adverse impact on our lenders, commodity hedging counterparties,credit profile or our customers, causing them to fail to meet their obligations to us. In addition, decreased returns on pension fund assets may also materially increase our pension funding requirements.

From time to time, our cash needs may exceed our internally generated cash flow, and our business could be materially and adversely affected if we were unable to obtain necessary funds from financing activities. From time to time, we may need to supplement our cash generated from operations with proceeds from financing activities.activities or provide letters of credit in certain commercial transactions. We have existing revolving credit facilities, committeduncommitted letter of credit facilities, and an accounts receivable sales facility intended to provide us with available financing to meet our ongoing cash needs.needs and commercial requirements. In addition, we rely on the counterparties to our commodity hedging and derivative instruments to fund their obligations under such arrangements. Uncertainty and illiquidity in financial markets may materiallycould have an adverse impact the ability of the participatingon our lenders, financial institutions, commodity hedging and otherderivative counterparties, and customers, causing them to fundfail to meet their commitmentsobligations to us, under our various financing facilities or our derivative instruments, which could have a material adverse effect on our business, financial position,condition, results of operations, and liquidity.

Severe weather events, such as storms, hurricanes, droughts, or floods, could have an adverse effect on our operations and could increase our costs. For instance,example, severe weather events can have an impact on cropscrop production and reduce the supply of, or otherwise increase our costs to obtain, feedstocks for our ethanolEthanol and renewable dieselRenewable Diesel segments. We have incurred and expect to continue to incur additional costs and expenses to keep our facilities performing and to mitigate and reduce the risk of severe weather to our operations. If climate changes result in more intense or frequent severe weather events occur, the physical and disruptive effects could have a material adverse impact on our operations and assets.

Certain workersemployees at five of our U.S. refineries, as well as at each of our CanadianCanada and U.K. refineries, and one of our terminals, are covered by collective bargaining or similar agreements, which generally have unique and independent expiration dates. To the extent we are in negotiations for labor agreements expiring in the future, there is no assurance an agreement will be reached without a strike, work stoppage, or other labor action. Any prolonged strike, work stoppage, or other labor action at our facilities or at facilities owned or operated by third parties that support our operations could have an adverse effect on our business, financial condition, or results of operations. In addition, futureoperations, and liquidity. Future U.S. federal, state, or foreigninternational labor legislation could result in labor shortages and higher costs, especially during critical maintenance periods.costs.

Our operations are subject to various hazards common to the industry, including explosions, fires, toxic emissions, maritime hazards, and natural catastrophes. As protection against these hazards, we maintain insurance coverage against some, but not all, potential losses and liabilities. We may not be able to maintain or obtain insurance of the type and amount we desireneed, or at reasonableacceptable rates. As a result of market conditions, premiums and deductibles for certain of our insurance policies could increase substantially. In some instances, certain insurance could become unavailable or available only for reduced amounts of coverage. For example, coverage for hurricane damage is very limited, and coverage for terrorism and cyber risks includes veryhave broad exclusions. If we were to incur a significant loss or liability for which we wereare not fully insured, it could have a material adverse effect on our business, financial position,condition, results of operations, and liquidity.

None.

LITIGATION

We incorporate by reference into this Item our disclosures made in Part II, Item 8 of this report included in Note 1 of Notes to Consolidated Financial Statements under the caption “Legal Contingencies.”

While it is not possible to predict the outcome of the following environmental proceedings, if any one or more of them were decided against us, we believe that there would be no material effect on our financial position,condition, results of operations, orand liquidity. We are reporting these proceedings to comply with U.S. SEC regulations, which require us to disclose certain information about proceedings arising under U.S. federal, state, or local provisions regulating the discharge of materials into the environment or protecting the environment if we reasonably believe that such proceedings have the potential to result in monetary sanctions of $300,000 or more.

None.

Our common stock trades on the NYSE under the trading symbol “VLO.”

As of January 31, 2021,2023, there were 4,9824,562 holders of record of our common stock.

Dividends are considered quarterly by the board of directors,Board, may be paid only when approved by the board,Board, and will depend on our financial condition, results of operations, cash flows, prospects, industry conditions, capital requirements, and other factors and restrictions our boardBoard deems relevant. There can be no assurance that we will pay a dividend in the future at the rates we have paid historically, or at all.

The following table discloses purchases of shares of our common stock made by us or on our behalf during the fourth quarter of 2020.2022.