UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
(Mark one)
 
x☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: SeptemberJune 30, 20182019
Oror
¨☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to             
Commission File Number: 001-35764
Commission File Number: 333-206728-02
 

PBF ENERGY INC.
PBF ENERGY COMPANY LLC
(Exact name of registrant as specified in its charter)
 

DELAWAREDelaware
45-3763855
DELAWAREDelaware61-1622166
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
  
One Sylvan Way, Second Floor
ParsippanyNew Jersey07054
(Address of principal executive offices)(Zip Code)
(973) (973) 455-7500
(Registrant’s telephone number, including area code)
 


Securities registered pursuant to Section 12(b) of the Act.
Title of each classTrading SymbolName of each exchange on which registered
Common Stockpar value $.001PBFNew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports);, and (2) has been subject to such filing requirements for the past 90 days.  


PBF Energy Inc.                 Yes [x] No [ ]
PBF Energy Company LLC        Yes [x] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).


PBF Energy Inc.             Yes [x] No [ ]
PBF Energy Company LLC    Yes [x] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
PBF Energy Inc.
Large accelerated filerþ
☑
Accelerated filer o
 
Accelerated filer o
Non-accelerated filero
☐
Smaller reporting companyo
☐
Emerging growth companyo
☐
PBF Energy Company LLC
Large accelerated filer
☐
Accelerated filer o
 
Accelerated filer o
Non-accelerated filerþ
☑
Smaller reporting companyo
☐
Emerging growth companyo
☐


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
PBF Energy Inc.             o☐
PBF Energy Company LLC o☐


Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
PBF Energy Inc.             Yes [ ]☐ No [x]☑
PBF Energy Company LLC    Yes [ ]☐ No [x]☑

As of October 29, 2018,July 30, 2019, PBF Energy Inc. had outstanding 119,889,646119,894,441 shares of Class A common stock and 20 shares of Class B common stock. PBF Energy Inc. is the sole managing member of, and owner of an equity interest representing approximately 99.0% of the outstanding economic interest in PBF Energy Company LLC as of SeptemberJune 30, 2018.2019. There is no trading in the membership interest of PBF Energy Company LLC and therefore an aggregate market value based on such is not determinable. PBF Energy Company LLC has no common stock outstanding.
 






PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
FORM 10-Q FOR THE QUARTERLY PERIOD ENDED SEPTEMBERJUNE 30, 20182019
TABLE OF CONTENTS
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
34
     
PART I – FINANCIAL INFORMATION
 
    
  ITEM 1.
Financial Statements (Unaudited)
 
  PBF Energy Inc. 
   
Condensed Consolidated Balance Sheets as of SeptemberJune 30, 20182019 and December 31, 2017
5
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2018 and 2017
6
Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2018 and 2017
7
   
Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2019 and 2018
8
Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2019 and 2018
9
Condensed Consolidated Statements of Changes in Equity for the three and six months ended June 30, 2019 and 2018
10
Condensed Consolidated Statements of Cash Flows for the ninesix months ended SeptemberJune 30, 20182019 and 20172018
812
  PBF Energy Company LLC 
   
Condensed Consolidated Balance Sheets as of SeptemberJune 30, 20182019 and December 31, 20172018
1014
   
Condensed Consolidated Statements of Operations for the three and ninesix months ended SeptemberJune 30, 20182019 and 20172018
1115
   
Condensed Consolidated Statements of Comprehensive Income for the three and ninesix months ended SeptemberJune 30, 20182019 and 20172018
1216
   
Condensed Consolidated Statements of Changes in Equity for the three and six months ended June 30, 2019 and 2018
17
Condensed Consolidated Statements of Cash Flows for the ninesix months ended SeptemberJune 30, 20182019 and 20172018
1319
     
Notes to PBF Energy Inc. and PBF Energy Company LLC Condensed Consolidated Financial Statements
1521
  ITEM 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
4852
  ITEM 3.
Quantitative and Qualitative Disclosures about Market Risk
7883
  ITEM 4.
Controls and Procedures
8085
  
PART II – OTHER INFORMATION
 
    
  ITEM 1.
Legal Proceedings
8186
ITEM 1A.
Risk Factors
90
  ITEM 2.
Unregistered Sales of Equity Securities and Use of Proceeds
8590
  ITEM 6.
Exhibits
8691
SIGNATURES
8892


This combined Quarterly Report on Form 10-Q is filed by PBF Energy Inc. (“PBF Energy”) and PBF Energy Company LLC (“PBF LLC”). Each Registrant hereto is filing on its own behalf all of the information contained in this report that relates to such Registrant. Each Registrant hereto is not filing any information that does not relate to such Registrant, and therefore makes no representation as to any such information. PBF Energy is a holding company whose primary asset is an equity interest in PBF LLC. PBF Energy is the sole managing member of, and owner of an equity interest representing approximately 99.0% of the outstanding economic interests in PBF LLC as of SeptemberJune 30, 2018.2019. PBF Energy operates and controls all of the business and affairs and consolidates the financial results of PBF LLC and its subsidiaries. PBF LLC is a holding company for the companies that directly and indirectly own and operate our business. PBF Holding Company LLC (“PBF Holding”) is a wholly-owned subsidiary of PBF LLC and PBF Finance Corporation (“PBF Finance”) is a wholly-owned subsidiary of PBF Holding. As of SeptemberJune 30, 2018,2019, PBF LLC also holds a 44.0%48.2% limited partner interest and a non-economic general partner interest and all of the incentive distribution rights in PBF Logistics LP (“PBFX” or the “Partnership”), a publicly traded master limited partnership. PBF Energy, through its ownership of PBF LLC, consolidates the financial results of PBFX and its subsidiaries and records a noncontrolling interest in its consolidated financial statements representing the economic interests of PBFX’s unit holders other than PBF LLC. Collectively, PBF Energy and its consolidated subsidiaries, including PBF LLC, PBF Holding, and PBFX are referred to hereinafter as the “Company” unless the context otherwise requires. Discussions or areas of this report that either apply only to PBF Energy or PBF LLC are clearly noted in such sections. Unless the context indicates otherwise, the terms “we,” “us,” and “our” refer to both PBF Energy and PBF LLC and its consolidated subsidiaries.




CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains certain “forward-looking statements”, as defined in the Private Securities Litigation Reform Act of 1995 (“PSLRA”), of expected future developments that involve risks and uncertainties. You can identify forward-looking statements because they contain words such as “believes,” “expects,” “may,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates,” or “anticipates” or similar expressions that relate to our strategy, plans or intentions. All statements we make relating to our estimated and projected earnings, margins, costs, expenditures, cash flows, growth rates and financial results or to our strategies, objectives, intentions, resources and expectations regarding future industry trends are forward-looking statements made under the safe harbor provisions of the PSLRA except to the extent such statements relate to the operations of a partnership or limited liability company. In addition, we, through our senior management, from time to time make forward-looking public statements concerning our expected future operations and performance and other developments. These forward-looking statements are subject to risks and uncertainties that may change at any time, and, therefore, our actual results may differ materially from those that we expected. We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, of course, it is impossible for us to anticipate all factors that could affect our actual results.
Important factors that could cause actual results to differ materially from our expectations, which we refer to as “cautionary statements,” are disclosed under “Management's Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Form 10-Q, the Annual Report on Form 10-K for the year ended December 31, 20172018 of PBF Energy and PBF LLC, which we refer to as our 20172018 Annual Report on Form 10-K, the PBF LLC financial statements for the year ended December 31, 2017 filed with PBF Logistics LP’s Registration Statement on Form S-4 filed on March 13, 2018 by PBF Logistics LP, and in our other filings with the SEC.U.S. Securities and Exchange Commission (“SEC”). All forward-looking information in this Quarterly Report on Form 10-Q and subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements. Some of the factors that we believe could affect our results include:
•supply, demand, prices and other market conditions for our products, including volatility in commodity prices;
•the effects of competition in our markets;
•changes in currency exchange rates, interest rates and capital costs;
•adverse developments in our relationship with both our key employees and unionized employees;
•our ability to operate our businesses efficiently, manage capital expenditures and costs (including general and administrative expenses) and generate earnings and cash flow;
•our indebtedness;
•our expectations with respect to our capital improvement and turnaround projects;
•our supply and inventory intermediation arrangements expose us to counterparty credit and performance risk;
•termination of our Inventory Intermediation Agreements with J. Aron, which could have a material adverse effect on our liquidity, as we would be required to finance our crude oil, intermediate and refined products inventory covered by the agreements. Additionally, we are obligated to repurchase from J. Aron certain crude, intermediates and finished products located at the Company’s storage tanks at the Paulsboro and Delaware City refineries’ storage tanksrefineries and at the PBFX East Coast Storage Facility upon termination of these agreements;agreements (all terms as defined in “Note 4 - Inventories” of our Notes to Condensed Consolidated Financial Statements);
•restrictive covenants in our indebtedness that may adversely affect our operational flexibility;
•payments by PBF Energy to the current and former holders of PBF LLC Series A Units and PBF LLC Series B Units under ourPBF Energy’s Tax Receivable Agreement (as defined in “Note 107 - Commitments and Contingencies” of our Notes to Condensed Consolidated Financial Statements) for certain tax benefits we may claim;


•our assumptions regarding payments arising under PBF Energy’s Tax Receivable Agreement and other arrangements relating to our organizational structure are subject to change due to various factors, including,


among other factors, the timing of exchanges of PBF LLC Series A Units for shares of ourPBF Energy Class A common stock as contemplated by the Tax Receivable Agreement, the price of ourPBF Energy Class A common stock at the time of such exchanges, the extent to which such exchanges are taxable, and the amount and timing of our income;
•our expectations and timing with respect to our acquisition activity and whether such acquisitions are accretive or dilutive to shareholders;
•our expectations with respect to our capital improvement and turnaround projects;
•the status of an air permit to transfer crude through the Delaware City refinery’s dock;
•the impact of disruptions to crude or feedstock supply to any of our refineries, including disruptions due to problems at PBFX or with third partythird-party logistics infrastructure or operations, including pipeline, marine and rail transportation;
•the possibility that we might reduce or not make further dividend payments;
•the inability of our subsidiaries to freely pay dividends or make distributions to us;
•the impact of current and future laws, rulings and governmental regulations, including the implementation of rules and regulations regarding transportation of crude oil by rail;
•the impact of the newly enacted federal income tax legislation on our business;
•the effectiveness of our crude oil sourcing strategies, including our crude by rail strategy and related commitments;
• adverse impacts related to legislation by the federal government lifting the restrictions on exporting U.S. crude oil;
•adverse impacts from changes in our regulatory environment, such as the effects of compliance with the California Global Warming Solutions Act (also referred to as “AB32”), or from actions taken by environmental interest groups;
•market risks related to the volatility in the price of Renewable Identification Numbers (“RINs”) required to comply with the Renewable Fuel Standards and greenhouse gas (“GHG”) emission credits required to comply with various GHG emission programs, such as AB32;
•our ability to successfully integrate recently completedconsummate the pending Martinez Acquisition (as defined in “ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations”), the timing for the closing of such acquisition and our plans for financing such acquisition;
•our ability to complete the successful integration of the Martinez Acquisition and any other acquisitions into our business and to realize the benefits from such acquisitions;
•unforeseen liabilities arising from recent acquisitions that are unforeseen or exceed our expectations;associated with the Martinez Acquisition and any other acquisitions;
•risk associated with the operation of PBFX as a separate, publicly-traded entity;
•potential tax consequences related to our investment in PBFX; and
•any decisions we continue to make with respect to our energy-related logisticallogistics assets that may be transferred to PBFX.


We caution you that the foregoing list of important factors may not contain all of the material factors that are important to you. In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this Quarterly Report on Form 10-Q may not in fact occur. Accordingly, investors should not place undue reliance on those statements.
Our forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required by applicable law, including the securities laws of the United States, we do not intend to update or revise any forward-looking statements. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing.


PART I – FINANCIAL INFORMATION
Item 1. Financial Statements


PBF ENERGY INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands,millions, except share and per share data)
September 30,
2018		 December 31,
2017		June 30,
2019		 December 31,
2018
ASSETS      
Current assets:      
Cash and cash equivalents (PBFX: $18,022 and $19,664, respectively)$1,059,200
 $573,021
Cash and cash equivalents (PBFX: $20.0 and $19.9, respectively)$204.1
 $597.3
Accounts receivable1,067,811
 952,552
989.8
 718.2
Inventories2,561,106
 2,213,797
2,314.4
 1,865.8
Prepaid and other current assets61,489
 63,589
90.7
 55.6
Total current assets4,749,606
 3,802,959
3,599.0
 3,236.9
Property, plant and equipment, net (PBFX: $736,876 and $684,488, respectively)3,597,266
 3,479,213
Property, plant and equipment, net (PBFX: $856.0 and $862.1, respectively)3,919.1
 3,820.9
Deferred tax assets—
 53,638
—
 48.5
Operating lease right of use assets236.9
 —
Deferred charges and other assets, net868,538
 782,183
1,054.7
 899.1
Total assets$9,215,410
 $8,117,993
$8,809.7
 $8,005.4
LIABILITIES AND EQUITY      
Current liabilities:      
Accounts payable$483,127
 $578,551
$444.2
 $488.4
Accrued expenses2,151,131
 1,814,854
1,846.8
 1,623.6
Deferred revenue13,154
 8,933
25.3
 20.1
Note payable—
 5,621
Current operating lease liabilities80.2
 —
Current debt1,242
 10,987
1.3
 2.4
Total current liabilities2,648,654
 2,418,946
2,397.8
 2,134.5
Long-term debt (PBFX: $567,152 and $548,793, respectively)2,175,889
 2,175,042
Long-term debt (PBFX: $769.2 and $673.3, respectively)2,029.4
 1,931.3
Payable to related parties pursuant to Tax Receivable Agreement381,260
 362,142
373.5
 373.5
Deferred tax liabilities122,406
 33,155
60.1
 40.4
Long-term operating lease liabilities156.1
 —
Other long-term liabilities241,840
 225,759
279.7
 277.2
Total liabilities5,570,049
 5,215,044
5,296.6
 4,756.9
Commitments and contingencies (Note 10)
 
Commitments and contingencies (Note 7)

 

Equity:      
PBF Energy Inc. equity      
Class A common stock, $0.001 par value, 1,000,000,000 shares authorized, 119,951,719 shares outstanding at September 30, 2018, 110,565,531 shares outstanding at December 31, 2017105
 95
Class B common stock, $0.001 par value, 1,000,000 shares authorized, 20 shares outstanding at September 30, 2018, 25 shares outstanding at December 31, 2017—
 —
Preferred stock, $0.001 par value, 100,000,000 shares authorized, no shares outstanding at September 30, 2018 and December 31, 2017—
 —
Treasury stock, at cost, 6,172,428 shares outstanding at September 30, 2018 and 6,132,884 shares outstanding at December 31, 2017(153,968) (152,585)
Class A common stock, $0.001 par value, 1,000,000,000 shares authorized, 119,894,441 shares outstanding at June 30, 2019, 119,874,191 shares outstanding at December 31, 20180.1
 0.1
Class B common stock, $0.001 par value, 1,000,000 shares authorized, 20 shares outstanding at June 30, 2019, 20 shares outstanding at December 31, 2018—
 —
Preferred stock, $0.001 par value, 100,000,000 shares authorized, no shares outstanding at June 30, 2019 and December 31, 2018—
 —
Treasury stock, at cost, 6,315,761 shares outstanding at June 30, 2019 and 6,274,261 shares outstanding at December 31, 2018
(162.2) (160.8)
Additional paid in capital2,631,191
 2,277,739
2,800.4
 2,633.8
Retained earnings615,540
 236,786
350.8
 225.8
Accumulated other comprehensive loss(24,934) (25,381)(21.7) (22.4)
Total PBF Energy Inc. equity3,067,934
 2,336,654
2,967.4
 2,676.5
Noncontrolling interest577,427
 566,295
545.7
 572.0
Total equity3,645,361
 2,902,949
3,513.1
 3,248.5
Total liabilities and equity$9,215,410
 $8,117,993
$8,809.7
 $8,005.4




PBF ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands,millions, except share and per share data)
Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
2018 2017 2018 20172019 2018 2019 2018
Revenues$7,646,360
 $5,478,951
 $20,893,219
 $15,250,649
$6,560.0
 $7,444.1
 $11,776.2
 $13,246.9

              
Cost and expenses:              
Cost of products and other6,816,095
 4,352,061
 18,400,732
 13,154,521
5,955.8
 6,452.5
 10,165.0
 11,584.6
Operating expenses (excluding depreciation and amortization expense as reflected below)424,331
 402,823
 1,268,161
 1,266,879
433.2
 417.7
 912.2
 843.8
Depreciation and amortization expense90,732
 75,948
 263,753
 197,800
104.2
 89.7
 207.2
 173.0
Cost of sales7,331,158
 4,830,832
 19,932,646
 14,619,200
6,493.2
 6,959.9
 11,284.4
 12,601.4
General and administrative expenses (excluding depreciation and amortization expense as reflected below)69,920
 58,259
 191,418
 143,147
53.6
 58.7
 111.2
 121.5
Depreciation and amortization expense2,594
 2,572
 7,871
 10,355
2.9
 2.6
 5.7
 5.3
(Gain) loss on sale of assets(43,745) 28
 (43,072) 940
Loss on sale of assets0.8
 0.6
 0.8
 0.7
Total cost and expenses7,359,927
 4,891,691
 20,088,863
 14,773,642
6,550.5
 7,021.8
 11,402.1
 12,728.9
              
Income from operations286,433
 587,260
 804,356
 477,007
9.5
 422.3
 374.1
 518.0
              
Other income (expense):              
Change in Tax Receivable Agreement liability7,763
 565
 7,763
 565
Change in fair value of catalyst leases1,630
 473
 5,783
 (1,011)0.5
 4.1
 (2.6) 4.1
Debt extinguishment costs—
 —
 —
 (25,451)
Interest expense, net(42,289) (36,990) (128,935) (114,871)(42.1) (43.4) (81.6) (86.6)
Other non-service components of net periodic benefit cost278
 (103) 833
 (305)—
 0.2
 (0.1) 0.5
Income before income taxes253,815
 551,205
 689,800
 335,934
Income tax expense61,349
 203,979
 167,836
 112,889
Net income192,466
 347,226
 521,964
 223,045
Income (loss) before income taxes(32.1) 383.2
 289.8
 436.0
Income tax (benefit) expense(10.5) 95.5
 70.0
 106.5
Net income (loss)(21.6) 287.7
 219.8
 329.5
Less: net income attributable to noncontrolling interests12,928
 32,861
 39,907
 49,420
10.6
 15.6
 22.8
 27.0
Net income attributable to PBF Energy Inc. stockholders$179,538
 $314,365
 $482,057
 $173,625
Net income (loss) attributable to PBF Energy Inc. stockholders$(32.2) $272.1
 $197.0
 $302.5
              
Weighted-average shares of Class A common stock outstanding              
Basic117,029,486
 109,724,595
 113,597,970
 109,634,921
119,181,845
 112,875,813
 119,885,386
 111,853,774
Diluted120,405,315
 113,882,240
 117,375,170
 113,791,542
119,181,845
 116,409,273
 122,020,444
 115,749,927
Net income available to Class A common stock per share:       
Net income (loss) available to Class A common stock per share:       
Basic$1.53
 $2.86
 $4.24
 $1.58
$(0.27) $2.41
 $1.64
 $2.70
Diluted$1.50
 $2.85
 $4.16
 $1.57
$(0.27) $2.37
 $1.63
 $2.66
       
Dividends per common share$0.30
 $0.30
 $0.90
 $0.90





PBF ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited, in millions)

 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
 2019 2018 2019 2018
Net income (loss)$(21.6) $287.7
 $219.8
 $329.5
Other comprehensive income (loss):    
 
Unrealized (loss) gain on available for sale securities0.3
 (0.2) 0.3
 (0.2)
Net gain on pension and other post-retirement benefits0.2
 0.2
 0.4
 0.5
Total other comprehensive income0.5
 —
 0.7
 0.3
Comprehensive income (loss)(21.1) 287.7
 220.5
 329.8
Less: comprehensive income attributable to noncontrolling interests10.8
 15.5
 22.9
 27.0
Comprehensive income (loss) attributable to PBF Energy Inc. stockholders$(31.9) $272.2
 $197.6
 $302.8

PBF ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(unaudited, in millions, except share and per share data)

 Class A
Common Stock		Class B
Common Stock		Additional
Paid-in
Capital		Retained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)		Treasury StockNoncontrolling
Interest		Total
Equity
 SharesAmountSharesAmountSharesAmount
Balance, December 31, 2018119,874,191
$0.1
20
$—
$2,633.8
$225.8
$(22.4)6,274,261
$(160.8)$572.0
$3,248.5
Comprehensive Income—
—
—
—
—
229.3
0.2
—
—
12.1
241.6
Exercise of warrants and options5,025
—
 —
0.1
—
—
—
—
—
0.1
Taxes paid for net settlement of equity-based compensation—
—
—
—
(1.0)—
—
—
—
—
(1.0)
Distributions to PBF Energy Company LLC members—
—
—
—
—
—
—
—
—
(0.4)(0.4)
Distributions to PBF Logistics LP public unitholders—
—
—
—
—
—
—
—
—
(13.2)(13.2)
Stock-based compensation(1,410)—
—
—
6.2
—
—
—
—
1.0
7.2
Dividends ($0.30 per common share)—
—
—
—
—
(36.0)—
—
—
—
(36.0)
Issuance of additional PBFX common units—
—
—
—
82.4
—
—
—
—
(82.4)—
Treasury stock purchases(29,671)—
—
—
1.0
—
—
29,671
(1.0)—
—
Balance, March 31, 2019119,848,135
$0.1
20
$—
$2,722.5
$419.1
$(22.2)6,303,932
$(161.8)$489.1
$3,446.8
Comprehensive Income (loss)—
—
—
—
—
(32.4)0.5
—
—
10.8
(21.1)
Exercise of warrants and options2,500
—
 —
0.1
—
—
—
—
—
0.1
Distributions to PBF Energy Company LLC members—
—
—
—
—
—
—
—
—
(1.9)(1.9)
Distributions to PBF Logistics LP public unitholders—
—
—
—
—
—
—
—
—
(16.8)(16.8)
Stock-based compensation45,635
—
—
—
7.7
—
—
—
—
3.4
11.1
Dividends ($0.30 per common share)—
—
—
—
—
(35.9)—
—
—
—
(35.9)
Issuance of additional PBFX common units—
—
—
—
69.6
—
—
—
—
62.9
132.5
Exchange of PBF Energy Company LLC Series A Units for PBF Energy Class A common stock10,000
—
—
—
0.1
—
—
—
—
—
0.1
Treasury stock purchases(11,829)—
—
—
0.4
—
—
11,829
(0.4)—
—
Other—
—
—
—
—
—
—
—
—
(1.8)(1.8)
Balance, June 30, 2019119,894,441
$0.1
20
$—
$2,800.4
$350.8
$(21.7)6,315,761
$(162.2)$545.7
$3,513.1





PBF ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMECHANGES IN EQUITY (continued)
(unaudited, in thousands)millions, except share and per share data)


 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
 2018 2017 2018 2017
Net income$192,466
 $347,226
 $521,964
 $223,045
Other comprehensive income:    
 
Unrealized (loss) gain on available for sale securities(77) (1) (312) 69
Net gain on pension and other post-retirement benefits254
 288
 763
 862
Total other comprehensive income177
 287
 451
 931
Comprehensive income192,643
 347,513
 522,415
 223,976
Less: comprehensive income attributable to noncontrolling interests12,929
 32,871
 39,911
 49,452
Comprehensive income attributable to PBF Energy Inc. stockholders$179,714
 $314,642
 $482,504
 $174,524
 Class A
Common Stock		Class B
Common Stock		Additional
Paid-in
Capital		Retained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)		Treasury StockNoncontrolling
Interest		Total
Equity
 SharesAmountSharesAmountSharesAmount
Balance, December 31, 2017110,565,531
$0.1
25
$—
$2,277.7
$236.8
$(25.4)6,132,884
$(152.6)$566.3
$2,902.9
Comprehensive Income—
—
—
—
—
30.3
0.3
—
—
11.5
42.1
Exercise of warrants and options45,257
—
 —
—
—
—
—
—
—
—
Distributions to PBF Energy Company LLC members—
—
—
—
—
—
—
—
—
(1.0)(1.0)
Distributions to PBF Logistics LP public unitholders—
—
—
—
—
—
—
—
—
(11.7)(11.7)
Stock-based compensation1,054
—
—
—
4.3
—
—
—
—
0.8
5.1
Dividends ($0.30 per common share)—
—
—
—
—
(33.3)—
—
—
—
(33.3)
Effects of exchanges of PBF LLC Series A Units on deferred tax assets and liabilities and tax receivable agreement obligation—
—
—
—
0.8
—
—
—
—
—
0.8
Exchange of PBF Energy Company LLC Series A Units for PBF Energy Class A common stock539,288
—
(3)—
—
—
—
—
—
—
—
Treasury stock purchases(32,149)—
—
—
1.0
—
—
32,149
(1.0)—
—
Other—
—
—
—
10.9
—
—
—
—
—
10.9
Balance, March 31, 2018111,118,981
$0.1
22
$—
$2,294.7
$233.8
$(25.1)6,165,033
$(153.6)$565.9
$2,915.8
Comprehensive Income—
—
—
—
—
272.2
—
—
—
15.5
287.7
Exercise of warrants and options557,659
—
 —
11.7
—
—
—
—
—
11.7
Taxes paid for net settlement of equity-based compensation—
—
—
—
—
—
—
—
—
(0.3)(0.3)
Distributions to PBF Energy Company LLC members—
—
—
—
—
—
—
—
—
(0.4)(0.4)
Distributions to PBF Logistics LP public unitholders—
—
—
—
—
—
—
—
—
(11.9)(11.9)
Stock-based compensation11,190
—
—
—
5.2
—
—
—
—
2.7
7.9
Dividends ($0.30 per common share)—
—
—
—
—
(34.0)—
—
—
—
(34.0)
Effects of exchanges of PBF LLC Series A Units on deferred tax assets and liabilities and tax receivable agreement obligation—
—
—
—
(3.2)—
—
—
—
—
(3.2)
Exchange of PBF Energy Company LLC Series A Units for PBF Energy Class A common stock2,148,763
—
(2)—
—
—
—
—
—
—
—
Treasury stock purchases(6,865)—
—
—
—
—
—
6,865
—
—
—
Other—
—
—
—
—
—
—
—
—
(1.0)(1.0)
Balance, June 30, 2018113,829,728
$0.1
20
$—
$2,308.4
$472.0
$(25.1)6,171,898
$(153.6)$570.5
$3,172.3







PBF ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)millions)
Nine Months Ended 
 September 30,		Six Months Ended 
 June 30,
2018 20172019 2018
Cash flows from operating activities:      
Net income$521,964
 $223,045
$219.8
 $329.5
Adjustments to reconcile net income to net cash provided by operating activities:   
Adjustments to reconcile net income to net cash (used in) provided by operating activities:   
Depreciation and amortization277,663
 215,052
218.4
 182.3
Stock-based compensation18,608
 18,064
20.0
 13.0
Change in fair value of catalyst leases(5,783) 1,011
2.6
 (4.1)
Deferred income taxes167,013
 111,325
68.2
 105.7
Change in Tax Receivable Agreement liability(7,763) (565)
Non-cash change in inventory repurchase obligations10,701
 (26,659)35.0
 2.5
Non-cash lower of cost or market inventory adjustment(300,456) (97,943)(324.0) (245.7)
Debt extinguishment costs—
 25,451
Pension and other post-retirement benefit costs35,536
 31,682
22.4
 23.7
(Gain) loss on sale of assets(43,072) 940
Loss on sale of assets0.8
 0.7
      
Changes in operating assets and liabilities:      
Accounts receivable(115,259) (155,838)(271.6) (81.5)
Inventories(46,853) (349,189)(124.6) (80.8)
Prepaid and other current assets2,100
 78,838
(35.1) 8.4
Accounts payable(109,847) (102,471)(33.5) 61.7
Accrued expenses318,848
 415,862
197.8
 7.6
Deferred revenue4,221
 (9,005)5.2
 (4.1)
Other assets and liabilities(7,292) (57,377)(28.8) (11.0)
Net cash provided by operating activities720,329
 322,223
Net cash (used in) provided by operating activities$(27.4) $307.9
      
Cash flows from investing activities:      
Expenditures for property, plant and equipment(192,152) (267,151)(206.1) (115.7)
Expenditures for deferred turnaround costs(201,029) (341,598)(261.9) (179.2)
Expenditures for other assets(16,946) (31,096)(33.9) (12.3)
Acquisition of Toledo Products Terminal by PBFX—
 (10,097)
Acquisition of Knoxville Terminals by PBFX(58,000) —
—
 (58.0)
Purchase of marketable securities—
 (75,036)
Maturities of marketable securities—
 115,060
Proceeds from sale of assets48,290
 —
Net cash used in investing activities$(419,837) $(609,918)$(501.9) $(365.2)





PBF ENERGY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(unaudited, in thousands)millions)
Nine Months Ended 
 September 30,		Six Months Ended 
 June 30,
2018 20172019 2018
Cash flows from financing activities:      
Net proceeds from issuance of Class A common stock$287,284
 $—
Net proceeds from issuance of PBFX common units34,820
 —
$132.5
 $—
Distributions to PBF Energy Company LLC members other than PBF Energy(1,724) (3,448)(2.4) (1.4)
Distributions to PBFX public unitholders(35,490) (32,261)(29.2) (22.9)
Dividend payments(103,015) (98,723)(71.7) (67.2)
Proceeds from 2025 Senior Notes—
 725,000
Cash paid to extinguish 2020 Senior Secured Notes—
 (690,209)
Proceeds from PBFX revolver borrowings64,000
 —
Repayments of PBFX revolver borrowings(43,700) —
Repayments of PBFX Term Loan borrowings—
 (39,664)
Repayments of PBF Rail Term Loan(5,092) (4,959)
Proceeds from revolver borrowings—
 490,000
1,250.0
 —
Repayments of revolver borrowings—
 (490,000)(1,250.0) —
Repayment of note payable(5,621) —
—
 (2.4)
Proceeds from PBFX revolver borrowings196.0
 64.0
Repayments of PBFX revolver borrowings(101.0) (9.7)
Repayments of PBF Rail Term Loan(3.5) (3.4)
Catalyst lease settlements(9,466) —
(1.2) (9.5)
Proceeds from insurance premium financing6,959
 —
18.9
 17.4
Proceeds from stock options exercised14,004
 —
0.2
 11.7
Purchase of treasury stock(1,383) —
(1.4) (1.0)
Deferred financing costs and other
(15,889) (13,424)(1.1) (13.0)
Net cash provided by (used in) financing activities185,687
 (157,688)$136.1
 $(37.4)
      
Net increase (decrease) in cash and cash equivalents486,179
 (445,383)
Net decrease in cash and cash equivalents(393.2) (94.7)
Cash and cash equivalents, beginning of period573,021
 746,274
597.3
 573.0
Cash and cash equivalents, end of period$1,059,200
 $300,891
$204.1
 $478.3
      
Supplemental cash flow disclosures      
Non-cash activities:      
Accrued and unpaid capital expenditures$48,545
 $36,172
$39.9
 $20.1
Note payable issued for purchase of property, plant and equipment—
 6,831
Assets acquired under operating leases281.6
 —
Assets acquired under finance leases14.6
 —
Cash paid during the year for:   
Interest (net of capitalized interest of $8.1 and $4.0 in 2019 and 2018, respectively)$72.1
 $80.9
Income taxes1.6
 0.1






PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands,millions, except unit and per unit data)
September 30,
2018		 December 31,
2017		June 30,
2019		 December 31,
2018
ASSETS      
Current assets:      
Cash and cash equivalents (PBFX: $18,022 and $19,664, respectively)$1,057,339
 $562,036
Cash and cash equivalents (PBFX: $20.0 and $19.9, respectively)$203.7
 $596.0
Accounts receivable1,067,811
 952,552
989.8
 718.2
Inventories2,561,106
 2,213,797
2,314.4
 1,865.8
Prepaid and other current assets61,489
 51,799
90.7
 55.1
Total current assets4,747,745
 3,780,184
3,598.6
 3,235.1
      
Property, plant and equipment, net (PBFX: $736,876 and $684,488, respectively)3,597,266
 3,479,213
Property, plant and equipment, net (PBFX: $856.0 and $862.1, respectively)3,919.1
 3,820.9
Operating lease right of use assets236.9
 —
Deferred charges and other assets, net863,834
 779,588
1,052.6
 897.1
Total assets$9,208,845
 $8,038,985
$8,807.2
 $7,953.1
   
LIABILITIES AND EQUITY      
Current liabilities:      
Accounts payable$482,933
 $578,551
$444.2
 $488.4
Accrued expenses2,167,794
 1,824,394
1,870.0
 1,642.7
Deferred revenue13,154
 8,933
25.3
 20.1
Note payable—
 5,621
Current operating lease liabilities80.2
 —
Current debt1,242
 10,987
1.3
 2.4
Total current liabilities2,665,123
 2,428,486
2,421.0
 2,153.6
      
Long-term debt (PBFX: $567,152 and $548,793, respectively)2,175,889
 2,175,042
Long-term debt (PBFX: $769.2 and $673.3, respectively)2,029.4
 1,931.3
Affiliate note payable326,115
 292,844
378.4
 326.1
Deferred tax liabilities27,778
 33,155
35.1
 40.4
Long-term operating lease liabilities156.1
 —
Other long-term liabilities241,867
 225,845
279.7
 277.2
Total liabilities5,436,772
 5,155,372
5,299.7
 4,728.6
      
Commitments and contingencies (Note 10)   
Commitments and contingencies (Note 7)   
      
Series B Units, 1,000,000 issued and outstanding, no par or stated value
5,110
 5,110
5.1
 5.1
PBF Energy Company LLC equity:      
Series A Units, 1,206,325 and 3,767,464 issued and outstanding at September 30, 2018 and December 31, 2017, no par or stated value
18,996
 40,058
Series C Units, 119,972,950 and 110,586,762 issued and outstanding at September 30, 2018 and December 31, 2017, no par or stated value
2,003,991
 1,654,999
Series A Units, 1,206,325 and 1,206,325 issued and outstanding at June 30, 2019 and December 31, 2018, no par or stated value20.2
 20.2
Series C Units, 119,915,672 and 119,895,422 issued and outstanding at June 30, 2019 and December 31, 2018, no par or stated value2,176.4
 2,009.8
Treasury stock, at cost(153,968) (152,585)(162.2) (160.8)
Retained earnings1,464,930
 906,875
1,058.2
 914.3
Accumulated other comprehensive loss(26,485) (26,936)(23.2) (23.9)
Total PBF Energy Company LLC equity3,307,464
 2,422,411
3,069.4
 2,759.6
Noncontrolling interest459,499
 456,092
433.0
 459.8
Total equity3,766,963
 2,878,503
3,502.4
 3,219.4
Total liabilities, Series B units and equity$9,208,845
 $8,038,985
$8,807.2
 $7,953.1




PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands)millions)
Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
2018 2017 2018 20172019 2018 2019 2018
Revenues$7,646,360
 $5,478,951
 $20,893,219
 $15,250,649
$6,560.0
 $7,444.1
 $11,776.2
 $13,246.9
              
Cost and expenses:              
Cost of products and other6,816,095
 4,352,061
 18,400,732
 13,154,521
5,955.8
 6,452.5
 10,165.0
 11,584.6
Operating expenses (excluding depreciation and amortization expense as reflected below)424,331
 402,823
 1,268,161
 1,266,879
433.2
 417.7
 912.2
 843.8
Depreciation and amortization expense90,732
 75,948
 263,753
 197,800
104.2
 89.7
 207.2
 173.0
Cost of sales7,331,158
 4,830,832
 19,932,646
 14,619,200
6,493.2
 6,959.9
 11,284.4
 12,601.4
General and administrative expenses (excluding depreciation and amortization expense as reflected below)69,594
 58,211
 190,399
 142,991
53.2
 58.2
 110.5
 120.8
Depreciation and amortization expense2,594
 2,572
 7,871
 10,355
2.9
 2.6
 5.7
 5.3
(Gain) loss on sale of assets(43,745) 28
 (43,072) 940
Loss on sale of assets0.8
 0.6
 0.8
 0.7
Total cost and expenses7,359,601
 4,891,643
 20,087,844
 14,773,486
6,550.1
 7,021.3
 11,401.4
 12,728.2
              
Income from operations286,759
 587,308
 805,375
 477,163
9.9
 422.8
 374.8
 518.7
              
Other income (expense):              
Change in fair value of catalyst leases1,630
 473
 5,783
 (1,011)0.5
 4.1
 (2.6) 4.1
Debt extinguishment costs—
 —
 —
 (25,451)
Interest expense, net(44,473) (38,893) (135,116) (120,910)(44.5) (45.4) (86.0) (90.6)
Other non-service components of net periodic benefit cost278
 (103) 833
 (305)—
 0.2
 (0.1) 0.5
Income before income taxes244,194
 548,785
 676,875
 329,486
Income tax (benefit) expense(719) (4,292) (5,403) 2,040
Net income244,913
 553,077
 682,278
 327,446
Income (loss) before income taxes(34.1) 381.7
 286.1
 432.7
Income tax expense (benefit)1.8
 (4.0) (5.4) (4.7)
Net income (loss)(35.9) 385.7
 291.5
 437.4
Less: net income attributable to noncontrolling interests10,534
 14,732
 30,117
 39,751
11.1
 9.4
 20.1
 19.6
Net income attributable to PBF Energy Company LLC$234,379
 $538,345
 $652,161
 $287,695
Net income (loss) attributable to PBF Energy Company LLC$(47.0) $376.3
 $271.4
 $417.8



PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited, in millions)

 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
 2019 2018 2019 2018
Net income (loss)$(35.9) $385.7
 $291.5
 $437.4
Other comprehensive income (loss):       
Unrealized (loss) gain on available for sale securities0.3
 (0.2) 0.3
 (0.2)
Net gain on pension and other post-retirement benefits0.2
 0.2
 0.4
 0.5
Total other comprehensive income0.5
 —
 0.7
 0.3
Comprehensive income (loss)(35.4) 385.7
 292.2
 437.7
Less: comprehensive income attributable to noncontrolling interests11.1
 9.4
 20.1
 19.6
Comprehensive income (loss) attributable to PBF Energy Company LLC$(46.5) $376.3
 $272.1
 $418.1

PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(unaudited, in millions, except unit data)
 Series ASeries CAccumulated
Other
Comprehensive Income (Loss)
Retained
Earnings
Noncontrolling
Interest
Treasury Stock
Total Member’s
Equity
 UnitsAmountUnitsAmount
Balance, December 31, 20181,206,325
$20.2
119,895,422
$2,009.8
$(23.9)$914.3
$459.8
$(160.8)$3,219.4
Comprehensive Income—
—
—
—
0.2
318.4
9.0
—
327.6
Exercise of Series A warrants and options—
—
5,025
(0.9)—
—
—
—
(0.9)
Distribution to members—
—
—
—
—
(36.4)(13.2)—
(49.6)
Issuance of additional PBFX common units—
—
—
82.4
—
—
(82.4)—
—
Stock-based compensation—
—
(1,410)6.2
—
—
1.0
—
7.2
Treasury stock purchases—
—
(29,671)1.0
—
—
—
(1.0)—
Balance, March 31, 20191,206,325
$20.2
119,869,366
$2,098.5
$(23.7)$1,196.3
$374.2
$(161.8)$3,503.7
Comprehensive Income (loss)—
—
—
—
0.5
(47.0)11.1
—
(35.4)
Exercise of Series A warrants and options10,000
0.1
2,500
0.1
—
—
—
—
0.2
Exchange of Series A units for PBF Energy Class A common stock(10,000)(0.1)10,000
0.1
—
—
—
—
—
Distribution to members—
—
—
—
—
(91.1)(16.8)—
(107.9)
Issuance of additional PBFX common units—
—
—
69.6
—
—
62.9
—
132.5
Stock-based compensation—
—
45,635
7.7
—
—
3.4
—
11.1
Treasury stock purchases—
—
(11,829)0.4
—
—
—
(0.4)—
Other—
—
—
—
—
—
(1.8)—
(1.8)
Balance, June 30, 20191,206,325
$20.2
119,915,672
$2,176.4
$(23.2)$1,058.2
$433.0
$(162.2)$3,502.4


PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMECHANGES IN EQUITY (continued)
(unaudited, in thousands)millions, except unit data)


 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
 2018 2017 2018 2017
Net income$244,913
 $553,077
 $682,278
 $327,446
Other comprehensive income:       
Unrealized (loss) gain on available for sale securities(77) (1) (312) 69
Net gain on pension and other post-retirement benefits254
 288
 763
 862
Total other comprehensive income177
 287
 451
 931
Comprehensive income245,090
 553,364
 682,729
 328,377
Less: comprehensive income attributable to noncontrolling interests10,534
 14,732
 30,117
 39,751
Comprehensive income attributable to PBF Energy Company LLC$234,556
 $538,632
 $652,612
 $288,626
 Series ASeries CAccumulated
Other
Comprehensive Income (Loss)		Retained
Earnings		Noncontrolling
Interest		Treasury StockTotal Member’s
Equity
 UnitsAmountUnitsAmount
Balance, December 31, 20173,767,464
$40.1
110,586,762
$1,655.0
$(26.9)$906.8
$456.1
$(152.6)$2,878.5
Comprehensive Income—
—
—
—
0.3
41.5
10.2
—
52.0
Exercise of Series A warrants and options11,886
—
45,257
—
—
—
—
—
—
Exchange of Series A units for PBF Energy Class A common stock(539,288)(4.1)539,288
4.1
—
—
—
—
—
Distribution to members—
—
—
—
—
(34.3)(11.7)—
(46.0)
Stock-based compensation—
—
1,054
4.3
—
—
0.8
—
5.1
Treasury stock purchases—
—
(32,149)1.0
—
—
—
(1.0)—
Other—
—
—
—
—
10.9
—
—
10.9
Balance, March 31, 20183,240,062
$36.0
111,140,212
$1,664.4
$(26.6)$924.9
$455.4
$(153.6)$2,900.5
Comprehensive Income—
—
—
—
—
376.3
9.4
—
385.7
Exercise of Series A warrants and options115,026
(3.3)557,659
—
—
—
—
—
(3.3)
Exchange of Series A units for PBF Energy Class A common stock(2,148,763)(13.2)2,148,763
13.2
—
—
—
—
—
Distribution to members—
—
—
—
—
(34.4)(11.9)—
(46.3)
Stock-based compensation—
—
11,190
5.2
—
—
2.7
—
7.9
Treasury stock purchases—
—
(6,865)—
—
—
—
—
—
Other—
—
—
—
—
—
(1.0)—
(1.0)
Balance, June 30, 20181,206,325
$19.5
113,850,959
$1,682.8
$(26.6)$1,266.8
$454.6
$(153.6)$3,243.5







PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)millions)
Nine Months Ended 
 September 30,		Six Months Ended 
 June 30,
2018 20172019 2018
Cash flows from operating activities:      
Net income$682,278
 $327,446
$291.5
 $437.4
Adjustments to reconcile net income to net cash provided by operating activities:   
Adjustments to reconcile net income to net cash (used in) provided by operating activities:   
Depreciation and amortization277,663
 215,052
218.4
 182.3
Stock-based compensation18,608
 18,064
20.0
 13.0
Change in fair value of catalyst leases(5,783) 1,011
2.6
 (4.1)
Deferred income taxes(5,377) 641
(5.3) (4.7)
Non-cash change in inventory repurchase obligations10,701
 (26,659)35.0
 2.5
Non-cash lower of cost or market inventory adjustment(300,456) (97,943)(324.0) (245.7)
Debt extinguishment costs—
 25,451
Pension and other post-retirement benefit costs35,536
 31,682
22.4
 23.7
(Gain) loss on sale of assets(43,072) 940
Loss on sale of assets0.8
 0.7
      
Changes in operating assets and liabilities:      
Accounts receivable(115,259) (155,838)(271.6) (81.5)
Inventories(46,853) (349,189)(124.6) (80.8)
Prepaid and other current assets(9,690) (4,732)(35.6) (1.8)
Accounts payable(110,041) (102,441)(33.5) 61.7
Accrued expenses317,159
 412,542
202.0
 2.4
Deferred revenue4,221
 (9,005)5.2
 (4.1)
Other assets and liabilities(10,534) (57,377)(28.8) (14.2)
Net cash provided by operating activities699,101
 229,645
Net cash (used in) provided by operating activities$(25.5) $286.8
      
Cash flows from investing activities:      
Expenditures for property, plant and equipment(192,152) (267,151)(206.1) (115.7)
Expenditures for deferred turnaround costs(201,029) (341,598)(261.9) (179.2)
Expenditures for other assets(16,946) (31,096)(33.9) (12.3)
Acquisition of Toledo Products Terminal by PBFX—
 (10,097)
Acquisition of Knoxville Terminals by PBFX(58,000) —
—
 (58.0)
Purchase of marketable securities—
 (75,036)
Maturities of marketable securities—
 115,060
Proceeds from sale of assets48,290
 —
Net cash used in investing activities$(419,837) $(609,918)$(501.9) $(365.2)



PBF ENERGY COMPANY LLC AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(unaudited, in thousands)millions)
Nine Months Ended 
 September 30,		Six Months Ended 
 June 30,
2018 20172019 2018
Cash flows from financing activities:      
Proceeds from issuance of PBF LLC Series C units$287,284
 $—
Net proceeds from issuance of PBFX common units34,820
 —
$132.5
 $—
Distributions to PBF Energy Company LLC members(104,739) (102,171)(74.2) (68.6)
Distributions to PBFX public unitholders(35,490) (32,261)(29.2) (22.9)
Proceeds from 2025 Senior Notes—
 725,000
Cash paid to extinguish 2020 Senior Secured Notes—
 (690,209)
Proceeds from PBFX revolver borrowings64,000
 —
Repayments of PBFX revolver borrowings(43,700) —
Repayments of PBFX Term Loan borrowings—
 (39,664)
Repayments of PBF Rail Term Loan(5,092) (4,959)
Proceeds from revolver borrowings—
 490,000
1,250.0
 —
Repayments of revolver borrowings—
 (490,000)(1,250.0) —
Repayment of note payable(5,621) —
—
 (2.4)
Proceeds from PBFX revolver borrowings196.0
 64.0
Repayments of PBFX revolver borrowings(101.0) (9.7)
Repayments of PBF Rail Term Loan(3.5) (3.4)
Catalyst lease settlements(9,466) —
(1.2) (9.5)
Proceeds from insurance premium financing6,959
 —
18.9
 17.4
Proceeds from affiliate loan with PBF Energy Inc.44,192
 99,655
Repayment of affiliate note payable with PBF Energy Inc.(0.8) 40.3
Proceeds from stock options exercised164
 —
0.1
 0.2
Purchase of treasury stock(1,383) —
Repurchase of treasury stock(1.4) (1.0)
Deferred financing costs and other(15,889) (13,424)(1.1) (13.0)
Net cash provided by (used in) financing activities216,039
 (58,033)$135.1
 $(8.6)
      
Net increase (decrease) in cash and cash equivalents495,303
 (438,306)
Net decrease in cash and cash equivalents(392.3) (87.0)
Cash and cash equivalents, beginning of period562,036
 734,962
596.0
 562.0
Cash and cash equivalents, end of period$1,057,339
 $296,656
$203.7
 $475.0
      
Supplemental cash flow disclosures      
Non-cash activities:      
Accrued and unpaid capital expenditures$48,545
 $36,172
$39.9
 $20.1
Note payable issued for purchase of property, plant and equipment—
 6,831
Assets acquired under operating leases281.6
 —
Assets acquired under finance leases14.6
 —
Affiliate note payable related to PBF LLC member distributions53.2
 —
Cash paid during the year for:   
Interest (net of capitalized interest of $8.1 and $4.0 in 2019 and 2018, respectively)$72.1
 $80.9
Income taxes0.7
 0.1
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


 
1. DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION
Description of the Business
PBF Energy Inc. (“PBF Energy”) was formed as a Delaware corporation on November 7, 2011 and is the sole managing member of PBF Energy Company LLC (“PBF LLC”), a Delaware limited liability company, with a controlling interest in PBF LLC and its subsidiaries. PBF Energy consolidates the financial results of PBF LLC and its subsidiaries and records a noncontrolling interest in its consolidated financial statementsCondensed Consolidated Financial Statements representing the economic interests of PBF LLC’s members other than PBF Energy (refer to “Note 9 - Equity”).
PBF Energy holds a 99.0% economic interest in PBF LLC as of June 30, 2019 through its ownership of PBF LLC Series C Units, which are held solely by PBF Energy. Holders of PBF LLC Series A Units, which are held by parties other than PBF Energy (“the members of PBF LLC other than PBF Energy”), hold the remaining 1.0% economic interest in PBF LLC. The PBF LLC Series C Units rank on parity with the PBF LLC Series A Units as to distribution rights, voting rights and rights upon liquidation, winding up or dissolution. In addition, the amended and restated limited liability company agreement of PBF LLC provides that any PBF LLC Series A Units acquired by PBF Energy will automatically be reclassified as PBF LLC Series C Units in connection with such acquisition. As of June 30, 2019, PBF Energy held 119,915,672 PBF LLC Series C Units and the members of PBF LLC other than PBF Energy held 1,206,325 PBF LLC Series A Units.
PBF LLC, together with its consolidated subsidiaries, owns and operates oil refineries and related facilities in North America. PBF Holding Company LLC (“PBF Holding”) is a wholly-owned subsidiary of PBF LLC. PBF Investments LLC (“PBF Investments”), Toledo Refining Company LLC (“Toledo Refining” or “TRC”), Paulsboro Refining Company LLC (“Paulsboro Refining” or “PRC”), Delaware City Refining Company LLC (“Delaware City Refining” or “DCR”), Chalmette Refining, L.L.C. (“Chalmette Refining”), PBF Western Region LLC (“PBF Western Region”), Torrance Refining Company LLC (“Torrance Refining”) and Torrance Logistics Company LLC are PBF LLC’s principal operating subsidiaries and are all wholly-owned subsidiaries of PBF Holding. Discussions or areas of the Notes to Condensed Consolidated Financial Statements that either apply only to PBF Energy or PBF LLC are clearly noted in such footnotes.
As of SeptemberJune 30, 2018,2019, PBF LLC also holdsheld a 44.0%48.2% limited partner interest and all of the incentive distribution rights in PBF Logistics LP (“PBFX”), a publicly tradedpublicly-traded master limited partnership (“MLP”) (refer to “Note 32 - PBF Logistics LP”). PBF Logistics GP LLC (“PBF GP”) owns the noneconomic general partner interest and serves as the general partner of PBFX and is wholly-owned by PBF LLC. PBF Energy, through its ownership of PBF LLC, consolidates the financial results of PBFX and its subsidiaries and records a noncontrolling interest in its consolidated financial statements representing the economic interests of PBFX’s unitholders other than PBF LLC.LLC (refer to “Note 9 - Equity”). Collectively, PBF Energy and its consolidated subsidiaries, including PBF LLC, PBF Holding, PBF GP and PBFX are referred to hereinafter as the “Company” unless the context otherwise requires.
As of September 30, 2018, the Company owns 119,972,950 PBF LLC Series C Units and the Company’s current and former executive officers and directors and certain employees and others beneficially own 1,206,325 PBF LLC Series A Units. As of September 30, 2018, the holders of the Company’s issued and outstanding shares of Class A common stock have 99.0% of the voting power in the Company and the members of PBF LLC other than PBF Energy through their holdings of Class B common stock have the remaining 1.0% of the voting power in the Company.
Substantially all of the Company’s operations are in the United States. The Company operates in two reportable business segments: Refining and Logistics. The Company’s oil refineries are all engaged in the refining of crude oil and other feedstocks into petroleum products, and are aggregated into the Refining segment. PBFX is a publicly traded master limited partnershipMLP that was formed to operate logisticallogistics assets such as crude oil and refined petroleum products terminals, pipelines and storage facilities. The Logistics segment consists solely of PBFX’s operations are aggregated into the Logistics segment.operations. To generate earnings and cash flows from operations, the Company is primarily dependent upon processing crude oil and selling refined petroleum products at margins sufficient to cover fixed and variable costs and other expenses. Crude oil and refined petroleum products are commodities; and factors that are largely out of the Company’s control can cause prices to vary over time. The resulting potential margin volatility can have a material effect on the Company’s financial position, earnings and cash flow.flows.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


Basis of Presentation
The unaudited condensed consolidated financial information furnished herein reflects all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, considered necessary for a fair presentation of the financial position and the results of operations and cash flows of the Company for the periods presented. All intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statementsCondensed Consolidated Financial Statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. These interim condensed consolidated financial statementsCondensed Consolidated Financial Statements should be read in conjunction with the PBF Energy Inc. and PBF Energy Company LLC financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2017 and the PBF LLC financial statements for the year ended December 31, 2017 included in the Registration Statement on Form S-4 filed on March 13, 2018 by PBFX.2018. The results of operations for the three and ninesix months ended SeptemberJune 30, 20182019 are not necessarily indicative of the results to be expected for the full year.
Torrance Land Sale
During the three months ended September 30, 2018,In 2019, the Company closed onhas changed its presentation from thousands to millions, as applicable, and as a third party sale of a parcel of real property acquired as part of the Torrance Refinery, but not part of the refinery itself. The sale resulted in a gain of approximately $43,761 included within Gain on sale of assets within the Condensed Consolidated Statements of Operations.result, any necessary rounding adjustments have been made to prior year disclosed amounts.
Recently Adopted Accounting Guidance
In May 2014,February 2016, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 (Topic 606) “Revenue from Contracts with Customers.” (“ASC 606”). ASC 606 supersedes the revenue recognition requirements in Accounting Standards Codification 605 “Revenue Recognition” (“ASC 605”), and requires entities to recognize revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective transition method. See “Note 2 - Revenues” for further details.
In March 2017, the FASB issued ASU No. 2017-07, “Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost” (“ASU 2017-07”), which provides guidance to improve the reporting of net periodic benefit cost in the income statement and on the components eligible for capitalization in assets. Under the new guidance, employers will present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. Additionally, under this guidance, employers will present the other non-service components of the net periodic benefit cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. Employers will apply the guidance on the presentation of the components of net periodic benefit cost in the income statement retrospectively. The guidance limiting the capitalization of net periodic benefit cost in assets to the service cost component will be applied prospectively. The guidance includes a practical expedient allowing entities to estimate amounts for comparative periods using the information previously disclosed in their pension and other postretirement benefit plan note to the financial statements. The amendments in this ASU are effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. The Company adopted ASU 2017-07 effective January 1, 2018 and applied the new guidance retrospectively in the Condensed Consolidated Statements of Operations. Income and expense amounts related to non-service components of net periodic benefit cost, historically recorded within Operating expenses and General and administrative expenses, have been recorded within Other income (expense). For the three and nine months ended September 30, 2018, the Company recorded income of $278 and $833, respectively, related to non-service components of net periodic benefit cost. For the three and nine months ended September 30, 2017, the Company recorded expense of $103 and $305, respectively, related to non-service components of net periodic benefit cost.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

In May 2017, the FASB issued ASU No. 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting” (“ASU 2017-09”), which provides guidance to increase clarity and reduce both diversity in practice and cost and complexity when applying the existing accounting guidance on changes to the terms or conditions of a share-based payment award. The amendments in ASU 2017-09 require an entity to account for the effects of a modification unless all the following are met: (i) the fair value of the modified award is the same as the fair value of the original award immediately before the original award is modified; (ii) the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and (iii) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. The guidance in ASU 2017-09 should be applied prospectively. The amendments in this ASU are effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. The Company’s adoption of this guidance did not materially impact its condensed consolidated financial statements.
Recent Accounting Pronouncements
In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”ASC 842”), to increase the transparency and comparability about leases among entities. Additional ASUs have been issued subsequent toof leases. ASU 2016-02 to provide supplementary clarification and implementation guidance for leases related to, among other things, the application of certain practical expedients, the rate implicit in842 supersedes the lease lessee reassessment of lease classification, lessor reassessment of lease term and purchase options, variable payments that depend on an index or rate and certain transition adjustments (collectively, the Company refers to ASU 2016-02 and these additional ASUs as the “Updated Lease Guidance”accounting guidance in ASC 840 - “Leases” (“ASC 840”). The Updated Lease GuidanceASC 842 requires lessees to recognize a lease liability and a corresponding lease asset for virtually all lease contracts. It also requires additional disclosures about leasing arrangements. The Updated Lease Guidance is effectiveCompany elected to utilize the “package” of three expedients, as defined in ASC 842, which retains the lease classification and initial direct costs for interim and annual periods beginning after December 15, 2018, and allows a modified retrospective approachany leases that existed prior to adoption. While early adoption is permitted,of the Company will not early adopt the Updated Lease Guidance.standard. The Company also has established a working groupelected to study the implementationnot evaluate land easements that existed as of, or expired before, adoption of the Updated Lease Guidancenew standard. The Company’s Condensed Consolidated Financial Statements for the periods prior to the adoption of ASC 842 are not adjusted and has instituted a task plan designed to meetare reported in accordance with the requirements and implementation deadline. The Company has also evaluated and purchased a lease software system, completed software design and configurationCompany’s historical accounting policy. As of the system, and substantially completed testing thedate of implementation of the selected system. The working group continues to evaluateon January 1, 2019, the impact of the Updated Lease Guidanceadoption of ASC 842 resulted in the recognition of a right of use asset and lease payable obligation on the Company’s consolidated financial statements and related disclosures and has designed and begun implementing business processes and controls to addressCondensed Consolidated Balance Sheets of approximately $250.0 million. As the new guidance. While the assessment of this standard is ongoing, the Company has identified that the most significant impacts of the Updated Lease Guidance will be to bring nearly all leases, with the exception of certain short-term leases, on its balance sheet reflected as right of use assetsasset and the lease payable obligation liabilities as well as accelerating recognitionwere the same upon adoption of the interest expense component of financing leases. The new standard will also require additional disclosures for financing and operating leases. The Updated Lease Guidance allows for certain practical expedients, certain of which the Company has elected to adopt including, among others, the expedient to carry forward the classification of leases under current lease guidance once the Updated Lease Guidance becomes effective, the expedient to not include short-term leases on its balance sheet and to avail itself of the additional transition method whereby it will apply the Updated Lease GuidanceASC 842, there was no cumulative effect impact on the effective date and recognize a cumulative-effect adjustment to openingCompany’s retained earnings.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

See “Note 8 - Leases” for further details.
In August 2017, the FASB issued ASU No. 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities” (“ASU 2017-12”). The amendments in ASU 2017-12 more closely align the results of cash flow and fair value hedge accounting with risk management activities in the consolidated financial statements. The amendments expand the ability to hedge nonfinancial and financial risk components, reduce complexity in fair value hedges of interest rate risk, eliminate the requirement to separately measure and report hedge ineffectiveness, and eases certain hedge effectiveness assessment requirements. The guidance in ASU 2017-12 should bewas applied using a modified retrospective approach. The guidance in ASU 2017-12 also providesprovided transition relief to make it easier for entities to apply certain amendments to existing hedges (including fair value hedges) where the hedge documentation needs to be modified. The presentation and disclosure requirements of ASU 2017-12 should bewere applied prospectively. The Company adopted the amendments in this ASU are effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. While the Company is still evaluating the timing of adoption, it currently doesJanuary 1, 2019, which did not expect this guidance to have a material impact on its consolidated financial statementsCondensed Consolidated Financial Statements and related disclosures.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


In June 2018, the FASB issued ASU No. 2018-07, “Compensation - Stock Compensation (Topic 718): Targeted Improvements to Non-employee Share-Based Payment Accounting” (“ASU 2018-07”). ASU 2018-07 expands the scope of Topic 718, Compensation-StockCompensation - Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees.non-employees. As a result, nonemployeenon-employee share-based transactions will be measured by estimating the fair value of the equity instruments at the grant date, taking into consideration the probability of satisfying performance conditions. In addition, ASU 2018-07 also clarifies that any share-based payment awards issued to customers should be evaluated under ASC 606, Revenue from Contracts with Customers.Customers (“ASC 606”). The Company adopted the amendments in this ASU are effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted. The Company doesJanuary 1, 2019, which did not expect this guidance to have a material impact on its consolidated financial statementsCondensed Consolidated Financial Statements and related disclosures.
In August 2018, the FASB issued ASU 2018-15, “Intangibles-Goodwill and Other-Internal-Use Software” (Subtopic 350-40) (“ASU 2018-15”). This guidance addresses a customer’s accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in such arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance is effective for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years, with early adoption permitted. This guidance should be applied on either a retrospective or prospective basis. The Company has elected to early adopt this guidance in the second quarter of 2019 on a prospective basis. The Company’s adoption of ASU 2018-15 did not have a material impact on its Condensed Consolidated Financial Statements and related disclosures.
Recently Issued Accounting Pronouncements
In August 2018, the FASB issued ASU No. 2018-14, “Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20)”, to improve the effectiveness of benefit plan disclosures in the notes to financial statements by facilitating clear communication of the information required by GAAP that is most important to users of each entity’s financial statements. The amendments in this ASU modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. Additionally, the amendments in this ASU remove disclosures that no longer are considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as relevant. The amendments in this ASU are effective for fiscal years ending after December 15, 2020, for public business entities and for fiscal years ending after December 15, 2021, for all other entities. Early adoption is permitted for all entities. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.
2. REVENUES
AdoptionIn June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses” (Topic 326), Measurement of Accounting Standards CodificationCredit Losses on Financial Instruments (“ASC”ASU 2016-13”) Topic 606, “Revenue from Contracts with Customers”
Prior to January 1, 2018,. This guidance amends the Company recognized revenue from customers whenguidance on measuring credit losses on financial assets held at amortized cost. ASU 2016-13 requires the measurement of all ofexpected credit losses for financial assets held at the following criteria were met:  (i) persuasive evidence of an exchange arrangement existed, (ii) delivery had occurred or services had been rendered, (iii) the buyer’s price was fixed or determinablereporting date based on historical experience, current conditions, and (iv) collectability was reasonably assured. Amounts billed in advance of the period in which the service was rendered or product delivered were recorded as deferred revenue. 
Effective January 1, 2018, the Company adopted ASC 606. As a result, the Company has changed its accounting policyreasonable and supportable forecasts. This guidance is effective for the recognition of revenue from contracts with customers as detailed below.
fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. The Company adopted ASC 606 usingdoes not expect that the modified retrospective method, which has been applied for the threeadoption of this guidance will have a material impact on its financial statements and nine months ended September 30, 2018. The Company has applied ASC 606 only to those contracts that were not complete as of January 1, 2018. As such, the financial information for prior periods has not been adjusted and continues to be reported under ASC 605. The Company did not record a cumulative effect adjustment upon initiallyrelated disclosures.

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


applying ASC 606 as there was not a significant impact upon adoption; however, the details of significant qualitative and quantitative disclosure changes upon implementing ASC 606 are detailed below.
Revenue Recognition
Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
As described in “Note 15 - Segment Information”, the Company’s business consists of the Refining Segment and Logistics Segment. The following table provides information relating to the Company’s revenues for each product or group of similar products or services by segment for the periods presented.
 Three Months Ended September 30,
 2018 2017
Refining Segment:

   
Gasoline and distillates$6,227,509
 $4,657,279
Feedstocks and other552,156
 192,817
Asphalt and blackoils544,943
 361,401
Chemicals243,174
 189,812
Lubricants74,162
 73,805
Total7,641,944
 5,475,114
Logistics Segment:   
Logistics70,556
 66,195
Total revenue prior to eliminations7,712,500
 5,541,309
Elimination of intercompany revenue(66,140) (62,358)
Total Revenues$7,646,360
 $5,478,951
    
 Nine Months Ended September 30,
 2018 2017
Refining Segment:   
Gasoline and distillates$17,563,586
 $12,900,465
Asphalt and blackoils1,251,007
 834,260
Feedstocks and other1,193,660
 726,804
Chemicals621,834
 553,311
Lubricants250,526
 222,349
Total20,880,613
 15,237,189
Logistics Segment:   
Logistics203,395
 190,375
Total revenue prior to eliminations21,084,008
 15,427,564
Elimination of intercompany revenue(190,789) (176,915)
Total Revenues$20,893,219
 $15,250,649

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

The majority of the Company’s revenues are generated from the sale of refined petroleum products reported in the Refining segment. These revenues are largely based on the current spot (market) prices of the products sold, which represent consideration specifically allocable to the products being sold on a given day, and the Company recognizes those revenues upon delivery and transfer of title to the products to our customers. The time at which delivery and transfer of title occurs is the point when the Company’s control of the products is transferred to the Company’s customers and when its performance obligation to its customers is fulfilled. Delivery and transfer of title are specifically agreed to between the Company and customers within the contracts. The Refining segment also has contracts which contain fixed pricing, tiered pricing, minimum volume features with makeup periods, or other factors that have not materially been affected by ASC 606.
Logistics segment revenue is generated by charging fees for crude oil and refined products terminaling, storing and pipeline services based on the greater of contractual minimum volume commitments, as applicable, or the delivery of actual volumes based on contractual rates applied to throughput or storage volumes. A majority of the Company’s logistics revenues are generated between intercompany transactions and are eliminated in consolidation.
Deferred Revenues
The Company records deferred revenues when cash payments are received or are due in advance of performance, including amounts which are refundable. Deferred revenue was $13,154 and $8,933 as of September 30, 2018 and December 31, 2017, respectively. Fluctuations in the deferred revenue balance are primarily driven by the timing and extent of cash payments received or due in advance of satisfying the Company’s performance obligations.
The Company’s payment terms vary by type and location of customers and the products offered. The period between invoicing and when payment is due is not significant (i.e. generally within two months). For certain products or services and customer types, the Company requires payment before the products or services are delivered to the customer.
Significant Judgment and Practical Expedients
For performance obligations related to sales of products, the Company has determined that customers are able to direct the use of, and obtain substantially all of the benefits from, the products at the point in time that the products are delivered. The Company has determined that the transfer of control upon delivery to the customer’s requested destination accurately depicts the transfer of goods. Upon the delivery of the products and transfer of control, the Company generally has the present right to payment and the customers bear the risks and rewards of ownership of the products. The Company has elected the practical expedient to not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed.

3.2. PBF LOGISTICS LP
PBFX is a fee-based, growth-oriented, publicly traded Delaware master limited partnershipMLP formed by PBF Energy to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets. PBFX engages in the receiving, handling, storage and transferring of crude oil, refined products, natural gas and intermediates from sources located throughout the United States and Canada for PBF Energy in support of its refineries, as well as for third party customers. As of SeptemberJune 30, 2018,2019, a substantial majority of PBFX’s revenue is derived from long-term, fee-based commercial agreements with PBF Holding, which include minimum volume commitments for receiving, handling, storing and transferring crude oil, refined products and natural gas. PBF Energy also has agreements with PBFX that establish fees for certain general and administrative services and operational and maintenance services provided by PBF Holding to PBFX. These transactions, other than those with third parties, are eliminated by PBF Energy and PBF LLC in consolidation.
PBFX, a variable interest entity, is consolidated by PBF Energy through its ownership of PBF LLC. PBF LLC, through its ownership of PBF GP, has the sole ability to direct the activities of PBFX that most significantly impact its economic performance. PBF LLC is considered to be the primary beneficiary of PBFX for accounting purposes.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

As of SeptemberJune 30, 2018,2019, PBF LLC holdsheld a 44.0%48.2% limited partner interest in PBFX consisting(consisting of 19,953,63129,953,631 common units,units) with the remaining 56.0%51.8% limited partner interest held by the public unitholders. PBF LLC also owns all of the incentive distribution rights (“IDRs”) and indirectly owns a non-economic general partner interest in PBFX through its wholly-owned subsidiary, PBF GP, the general partner of PBFX. The IDRs entitleOn February 28, 2019, PBFX closed on an Equity Restructuring Agreement (the “IDR Restructuring Agreement”) with PBF LLC and PBF GP, pursuant to receive increasing percentages, upwhich PBFX’s incentive distribution rights (the “IDRs”) held by PBF LLC were canceled and converted into 10,000,000 newly issued PBFX common units (the “IDR Restructuring”). Subsequent to a maximum of 50.0%,the closing of the cashIDR Restructuring, no distributions were made to PBF LLC with respect to the IDRs and the newly issued PBFX distributes from operating surplus in excess of $0.345 per unit per quarter.common units are entitled to normal distributions by PBFX.
Knoxville Terminals PurchasePBFX Registered Direct Offering
On April 16, 2018, PBFX completed the purchase of two refined product terminals located in Knoxville, Tennessee, which include product tanks, pipeline connections to the Colonial and Plantation pipeline systems and truck loading facilities (the “Knoxville Terminals”) from Cummins Terminals, Inc. (“Cummins”) for total cash consideration of $58,000, excluding working capital adjustments (the “Knoxville Terminals Purchase”). The transaction was financed through a combination of cash on hand and borrowings under the PBFX Revolving Credit Facility.
Registered Direct Offering
On July 16, 2018,24, 2019, PBFX entered into asubscription agreements to sell an aggregate of 6,585,500 common unit purchase agreement withunits to certain funds managed by Tortoise Capital Advisors, L.L.C. providing for the issuance and saleinstitutional investors in a registered direct public offering (the “Registered“PBFX Registered Direct Offering”) of an aggregate of 1,775,750 common units for gross proceeds of approximately $35,000.$135.0 million. The PBFX Registered Direct Offering closed on July 30, 2018.April 29, 2019.
TVPC Acquisition
4. EQUITY
Noncontrolling Interest inOn April 24, 2019, PBFX entered into a contribution agreement with PBF LLC
PBF Energy is the sole managing member of, and has a controlling interest in, PBF LLC. As the sole managing member of (the “TVPC Contribution Agreement”), pursuant to which PBF LLC PBF Energy operates and controlscontributed to PBFX all of the businessissued and affairsoutstanding limited liability company interests of PBFTVP Holding Company LLC and its subsidiaries. As(“TVP Holding”) for total consideration of September 30, 2018 and December 31, 2017, PBF Energy’s equity$200.0 million (the “TVPC Acquisition”). Prior to the TVPC Acquisition, TVP Holding owned a 50% membership interest in PBFTorrance Valley Pipeline Company LLC represented approximately 99.0% and 96.7%, respectively,(“TVPC”). Subsequent to the closing of the outstanding interests.
PBF Energy consolidatesTVPC Acquisition on May 31, 2019, PBFX owns 100% of the financial results of PBF LLC and its subsidiaries, and records a noncontrolling interest for the economic interest in PBF Energy held by the members of PBF LLC other than PBF Energy. Noncontrolling interest on the condensed consolidated statements of operations includes the portion of net income or loss attributable to the economic interest in PBF Energy held by the members of PBF LLC other than PBF Energy. Noncontrolling interest on the condensed consolidated balance sheets represents the portion of net assets of PBF Energy attributable to the members of PBF LLC other than PBF Energy.
The noncontrolling interest ownership percentages in PBF LLC as of September 30, 2018 and December 31, 2017 are calculated as follows:
 Holders of PBF LLC Series A Units Outstanding Shares of PBF Energy Class A Common Stock 
Total *
December 31, 20173,767,464
 110,565,531
 114,332,995
 3.3% 96.7% 100.0%
September 30, 20181,206,325
 119,951,719
 121,158,044
 1.0% 99.0% 100.0%
——————————
*Assumes all of the holders of PBF LLC Series A Units exchange their PBF LLC Series A Units for shares of PBF Energy’s Class A common stock on a one-for-one basis.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

Noncontrolling Interest in PBFX
PBF LLC holds a 44.0% limited partner interest in PBFX and owns all of PBFX’s IDRs, with the remaining 56.0% limited partner interest owned by public common unitholders as of September 30, 2018. PBF LLC is also the sole member of PBF GP, the general partner of PBFX.
PBF Energy, through its ownership of PBF LLC, consolidates the financial results of PBFX, and records a noncontrolling interest for the economic interest in PBFX held by the public common unitholders. Noncontrolling interest on the condensed consolidated statements of operations includes the portion of net income or loss attributable to the economic interest in PBFX held by the public common unitholders of PBFX other than PBF Energy (through its ownership in PBF LLC). Noncontrolling interest on the condensed consolidated balance sheets includes the portion of net assets of PBFX attributable to the public common unitholders of PBFX.
The noncontrolling interest ownership percentages in PBFX as of September 30, 2018 and December 31, 2017, are calculated as follows:

Units of PBFX Held by the Public
Units of PBFX Held by PBF LLC
Total
December 31, 201723,441,211
 18,459,497
 41,900,708

55.9% 44.1% 100.0%
September 30, 201825,393,565
 19,953,631
 45,347,196
 56.0% 44.0% 100.0%
Noncontrolling Interest in PBF Holding
In connection with the Chalmette Acquisition, PBF Holding recorded noncontrollingmembership interests in two subsidiaries of Chalmette Refining. PBF Holding, through Chalmette Refining, owns an 80% ownership interest in both Collins Pipeline Company and T&M Terminal Company. For the three months ended September 30, 2018 and 2017 the Company recorded a noncontrolling interest in the earnings (loss) of these subsidiaries of $35 and $(6), respectively. For the nine months ended September 30, 2018 and 2017 the Company recorded a noncontrolling interest in the earnings of these subsidiaries of $43 and $374, respectively.TVPC.

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


Changes3. ACQUISITIONS
East Coast Storage Assets Acquisition
On October 1, 2018, PBFX closed the acquisition of CPI Operations LLC (“CPI”), whose assets include a storage facility with multi-use storage capacity, an Aframax-capable marine facility, a rail facility, a truck terminal, equipment, contracts and certain other idled assets (collectively, the “East Coast Storage Assets”) located on the Delaware River near Paulsboro, New Jersey (the “East Coast Storage Assets Acquisition”), which had been contemplated by an agreement dated as of July 16, 2018 between PBFX and Crown Point International, LLC (“Crown Point”). Additionally, the East Coast Storage Assets Acquisition includes an earn-out provision related to an existing commercial agreement with a third-party, based on the future results of certain of the acquired idled assets (the “Contingent Consideration”) which are expected to be restarted in Equitythe fourth quarter of 2019.
The aggregate purchase price for the East Coast Storage Assets Acquisition was $127.0 million, including working capital and Noncontrolling Interests
On August 14, 2018, the Company completed a public offeringContingent Consideration, which was comprised of an aggregateinitial payment at closing of 6,000,000 shares$75.0 million with a remaining balance of Class A common stock$32.0 million payable one year after closing. The residual purchase consideration consists of the Contingent Consideration. The consideration was financed through a combination of cash on hand and borrowings under the amended and restated PBFX revolving credit facility (the “August 2018 Equity Offering”“PBFX Revolving Credit Facility”) for net proceeds. The fair value allocation is subject to adjustment pending completion of $287,284, after deducting underwriting discountsthe final purchase valuation, which was in process as of June 30, 2019, as the purchase price and commissions and other offering expenses. The following tables summarize thefair value allocation may be subject to adjustment due to changes in equityassumptions and timing that may impact the Contingent Consideration.
PBFX accounted for the controllingEast Coast Storage Assets Acquisition as a business combination under GAAP whereby PBFX recognizes assets acquired and noncontrolling interestsliabilities assumed at their estimated fair values as of PBF Energy for the nine months ended September 30, 2018date of acquisition.
The total purchase consideration and 2017, respectively:the estimated fair values of the assets and liabilities at the acquisition date were as follows:
 PBF Energy Inc. Equity Noncontrolling
Interest in PBF LLC
Noncontrolling Interest in PBF Holding Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2018$2,336,654
 $110,203
 $10,808
 $445,284
 $2,902,949
Comprehensive income482,504
 9,794
 43
 30,074
 522,415
Dividends and distributions(103,303) (1,724) —
 (36,466) (141,493)
Effects of exchanges of PBF LLC Series A Units on deferred tax assets and liabilities and Tax Receivable Agreement obligation(2,756) —
 —
 —
 (2,756)
Issuance of additional PBFX common units28,564
 —
 —
 6,256
 34,820
Equity-based compensation awards14,059
 —
 —
 4,549
 18,608
August 2018 Equity Offering287,284
 —
 —
 —
 287,284
Exercise of PBF LLC and PBF Energy options and warrants, net14,004
 (345) —
 —
 13,659
Other10,924
 —
 —
 (1,049) 9,875
Balance at September 30, 2018$3,067,934
 $117,928
 $10,851
 $448,648
 $3,645,361
(in millions)Purchase Price
Gross purchase price*$105.9
Estimated working capital adjustments—
Contingent consideration**21.1
Total consideration$127.0

* Includes $30.9 million net present value payable of $32.0 million due to Crown Point one year after closing, which is included in “Accrued expenses” on the Condensed Consolidated Balance Sheets.
** Contingent consideration is included in “Other long-term liabilities” on the Condensed Consolidated Balance Sheets.

The following table summarizes the estimated amounts recognized for assets acquired and liabilities assumed as of the acquisition date:
 PBF Energy Inc. Equity Noncontrolling
Interest in PBF LLC		 Noncontrolling
Interest in PBF Holding		 Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2017$2,025,044
 $98,671
 $12,513
 $434,456
 $2,570,684
Comprehensive income174,524
 9,701
 374
 39,377
 223,976
Dividends and distributions(98,723) (3,448) —
 (33,090) (135,261)
Equity-based compensation awards13,549
 —
 —
 4,515
 18,064
Other(2,096) —
 —
 (5) (2,101)
Balance at September 30, 2017$2,112,298
 $104,924
 $12,887
 $445,253
 $2,675,362
(in millions)Fair Value Allocation
Accounts receivable$0.4
Prepaid and other current assets1.8
Property, plant and equipment114.4
Intangible assets*13.3
Accounts payable(0.9)
Accrued expenses(1.3)
Other long-term liabilities(0.7)
Estimated fair value of net assets acquired$127.0
* Intangible assets are included in “Deferred charges and other assets” on the Condensed Consolidated Balance Sheets.

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


The following tables summarizeEast Coast Storage Asset Acquisition includes consideration in the changesform of the Contingent Consideration. Pursuant to the agreement, PBFX and Crown Point will share equally in equitythe future operating profits of the restarted assets, as defined in the agreement, over a contractual term of up to three years starting in 2019. PBFX recorded the Contingent Consideration based on its estimated fair value of $21.1 million at acquisition date, which was recorded in Other long-term liabilities on the Condensed Consolidated Balance Sheets.
The Company’s Condensed Consolidated Financial Statements for the controllingsix months ended June 30, 2019 include the results of operations of the East Coast Storage Assets subsequent to the East Coast Storage Assets Acquisition, whereas the same period in 2018 does not include the results of operations of such assets. On an unaudited pro forma basis, the revenues and noncontrolling interestsnet income of PBF LLCthe Company, assuming the acquisition had occurred on January 1, 2017, for the nineperiod indicated, are shown below. The unaudited pro forma information does not purport to present what the Company’s actual results would have been had the East Coast Storage Assets Acquisition occurred on January 1, 2017, nor is the financial information indicative of the results of future operations. The unaudited pro forma financial information includes the depreciation and amortization expense related to the East Coast Storage Assets Acquisition and interest expense associated with the related financing.
  Six Months Ended June 30, 2018
(Unaudited, in millions)
PBF Energy  
Pro forma revenues $13,258.5
Pro forma net income attributable to PBF Energy Inc. stockholders 301.0
   
PBF LLC  
Pro forma revenues $13,258.5
Pro forma net income attributable to PBF LLC 415.7

Acquisition Expenses
The Company incurred acquisition-related costs of $3.2 million and $3.3 million for the three and six months ended SeptemberJune 30, 2019, respectively. The Company incurred acquisition-related costs of $0.7 million and $1.2 million for the three and six months ended June 30, 2018, respectively. Acquisition-related costs consist primarily of consulting and 2017, respectively:legal expenses related to completed, pending and non-consummated acquisitions. These costs are included in General and administrative expenses within the Condensed Consolidated Statements of Operations.
 PBF Energy Company LLC Equity Noncontrolling Interest in PBF Holding Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2018$2,422,411
 $10,808
 $445,284
 $2,878,503
Comprehensive income652,612
 43
 30,074
 682,729
Dividends and distributions(105,027) —
 (36,466) (141,493)
Issuance of additional PBFX common units28,564
 —
 6,256
 34,820
Equity-based compensation awards14,059
 —
 4,549
 18,608
Exercise of PBF LLC options and warrants, net(3,760) —
 —
 (3,760)
Issuance of Series C units in connection with the August 2018 Equity Offering287,284
 —
 —
 287,284
Other11,321
 —
 (1,049) 10,272
Balance at September 30, 2018$3,307,464
 $10,851
 $448,648
 $3,766,963
 PBF Energy Company LLC Equity Noncontrolling
Interest in PBF Holding		 Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2017$2,040,851
 $12,513
 $434,456
 $2,487,820
Comprehensive income288,626
 374
 39,377
 328,377
Dividends and distributions(102,171) —
 (33,090) (135,261)
Equity-based compensation awards13,549
 —
 4,515
 18,064
Other(2,096) —
 (5) (2,101)
Balance at September 30, 2017$2,238,759
 $12,887
 $445,253
 $2,696,899
Share Activity
The following table presents the changes in PBF Energy Class A common stock and treasury stock outstanding:
 Nine Months Ended September 30, 2018 Year Ended December 31, 2017
 Class A Common Stock Treasury Stock Class A Common Stock Treasury Stock
Balance at beginning of period110,565,531
 6,132,884
 109,204,047
 6,087,963
Treasury stock purchases (1)(39,544) 39,544
 —
 44,921
Stock based compensation35,811
 —
 702,404
 —
Exercise of options and warrants691,286
 —
 462,500
 —
Exchange of PBF LLC Series A units for shares of Class A common stock2,698,635
 —
 196,580
 —
August 2018 Equity Offering6,000,000
 —
 —
 —
Balance at end of period119,951,719
 6,172,428
 110,565,531
 6,132,884
_____
(1) Includes shares repurchased from participants in connection with the vesting of equity awards granted under the Company’s stock compensation plans to cover employee income tax liabilities.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


The following table presents the changes in PBF LLC Series A Units and Series C Units outstanding:
 Nine Months Ended September 30, 2018 Year Ended December 31, 2017
 Series A Units Series C Units Series A Units Series C Units
Balance at beginning of period3,767,464
 110,586,762
 3,920,902
 109,204,047
Exercise of Series A warrants and options137,496
 691,286
 64,373
 462,500
Exchange of Series A units for PBF Energy Class A common stock(2,698,635) 2,698,635
 (196,580) 217,811
Grant of restricted shares—
 35,811
 —
 702,404
Surrender of units for tax withholding—
 (39,544) —
 —
Redemption of Series A units by PBF Energy—
 —
 (21,231) —
August 2018 Equity Offering—
 6,000,000
 —
 —
Balance at end of period1,206,325
 119,972,950
 3,767,464
 110,586,762

5.4. INVENTORIES
Inventories consisted of the following:
September 30, 2018
Titled Inventory Inventory Intermediation Agreements Total
June 30, 2019June 30, 2019
(in millions)Titled Inventory Inventory Intermediation Agreements Total
Crude oil and feedstocks$1,055,654
 $—
 $1,055,654
$992.7
 $115.0
 $1,107.7
Refined products and blendstocks1,060,841
 339,134
 1,399,975
1,082.9
 335.1
 1,418.0
Warehouse stock and other105,477
 —
 105,477
116.5
 —
 116.5
$2,221,972
 $339,134
 $2,561,106
$2,192.1
 $450.1
 $2,642.2
Lower of cost or market adjustment—
 —
 —
(250.6) (77.2) (327.8)
Total inventories$2,221,972
 $339,134
 $2,561,106
$1,941.5
 $372.9
 $2,314.4
December 31, 2017
Titled Inventory Inventory Intermediation Agreements Total
December 31, 2018December 31, 2018
(in millions)Titled Inventory Inventory Intermediation Agreements Total
Crude oil and feedstocks$1,073,093
 $—
 $1,073,093
$1,044.8
 $—
 $1,044.8
Refined products and blendstocks1,030,817
 311,477
 1,342,294
1,026.9
 334.8
 1,361.7
Warehouse stock and other98,866
 —
 98,866
111.1
 —
 111.1
$2,202,776
 $311,477
 $2,514,253
$2,182.8
 $334.8
 $2,517.6
Lower of cost or market adjustment(232,652) (67,804) (300,456)(557.2) (94.6) (651.8)
Total inventories$1,970,124
 $243,673
 $2,213,797
$1,625.6
 $240.2
 $1,865.8

Inventory under inventory intermediation agreements includes crude oil and certain light finished products sold to counterparties and stored in the Paulsboro and Delaware City refineries’ storage facilities in connection with the amended and restated inventory intermediation agreements (as amended in the first quarter of 2019, the “Inventory Intermediation Agreements”) with J. Aron & Company, a subsidiary of The Goldman Sachs Group, Inc. (“J. Aron”). This inventory is held in the Company’s storage tanks at the Delaware City and Paulsboro refineries and at PBFX’s East Coast Storage Assets (the “PBFX East Coast Storage Facility”, and together with the Company’s storage tanks at the Delaware City and Paulsboro refineries, the “Storage Tanks”).
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

At September 30, 2018 the replacement value of inventories exceeded the LIFO carrying value by approximately $12,037. During the three months ended SeptemberJune 30, 2019, the Company recorded an adjustment to value its inventories to the lower of cost or market which decreased operating income by $182.0 million, reflecting the net change in the lower of cost or market (“LCM”) inventory reserve from $145.8 million at March 31, 2019 to $327.8 million at June 30, 2019. During the six months ended June 30, 2019, the Company recorded an adjustment to value its inventories to the lower of cost or market which increased operating income by $324.0 million, reflecting the net change in the LCM inventory reserve from $651.8 million at December 31, 2018 to $327.8 million at June 30, 2019.
During the three months ended June 30, 2018, the Company recorded an adjustment to value its inventories to the lower of cost or market which increased operating income andby $158.0 million, reflecting the net income by $54,801 and $40,328, respectively, reflecting no lower of cost or market (“LCM”) reserve as of September 30, 2018change in comparison to anthe LCM reserve of $54,801from $212.8 million at March 31, 2018 to $54.8 million at June 30, 2018. During the ninesix months ended SeptemberJune 30, 2018, the Company recorded an LCM inventory adjustment which increased operating income and net income by $300,456 and $221,106, respectively, reflecting no LCM reserve as of September 30, 2018 in comparison to an LCM reserve of $300,456 at December 31, 2017.
During the three months ended September 30, 2017, the Company recorded an adjustment to value its inventories to the lower of cost or market which increased operating income and net income by $265,077 and $160,743, respectively,$245.7 million, reflecting the net change in the LCM reserve from $763,122$300.5 million at December 31, 2017 to $54.8 million at June 30, 2017 to $498,045 at September 30, 2017. During the nine months ended September 30, 2017, the Company recorded an LCM inventory adjustment which increased operating income and net income by $97,943 and $59,393, respectively, reflecting the net change in the LCM reserve from $595,988 at December 31, 2016 to $498,045 at September 30, 2017.2018.

6. ACCRUED EXPENSES
Accrued expenses consisted of the following:


PBF Energy
September 30,
2018		 December 31,
2017
Inventory-related accruals$1,451,142
 $1,151,810
Inventory intermediation agreements254,022
 244,287
Excise and sales tax payable123,174
 118,515
Accrued transportation costs56,167
 64,400
Accrued salaries and benefits55,366
 58,589
Accrued interest43,395
 14,080
Renewable energy credit and emissions obligations32,753
 26,231
Accrued utilities32,371
 42,189
Accrued capital expenditures26,082
 18,765
Accrued refinery maintenance and support costs23,147
 35,674
Customer deposits20,583
 16,133
Environmental liabilities7,173
 8,289
Other25,756
 15,892
Total accrued expenses$2,151,131
 $1,814,854
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT

5. ACCRUED EXPENSES
Accrued expenses consisted of the following:

PBF Energy (in millions)
June 30, 2019 December 31, 2018
Inventory-related accruals$1,121.8
 $846.3
Inventory intermediation agreements315.6
 249.4
Excise and sales tax payable132.9
 149.4
Accrued transportation costs60.2
 53.6
Accrued utilities32.2
 49.8
Deferred payment - East Coast Storage Assets Acquisition31.7
 30.9
Accrued capital expenditures29.6
 60.6
Renewable energy credit and emissions obligations26.5
 27.1
Accrued refinery maintenance and support costs19.9
 19.0
Accrued salaries and benefits13.6
 89.8
Accrued interest12.5
 12.1
Environmental liabilities9.7
 7.0
Customer deposits1.4
 5.6
Other39.2
 23.0
Total accrued expenses$1,846.8
 $1,623.6

PBF LLC (in millions)
June 30, 2019 December 31, 2018
Inventory-related accruals$1,121.8
 $846.3
Inventory intermediation agreements315.6
 249.4
Excise and sales tax payable132.9
 149.4
Accrued transportation costs60.2
 53.6
Accrued interest34.7
 29.9
Accrued utilities32.2
 49.8
Deferred payment - East Coast Storage Assets Acquisition31.7
 30.9
Accrued capital expenditures29.6
 60.6
Renewable energy credit and emissions obligations26.5
 27.1
Accrued refinery maintenance and support costs19.9
 19.0
Accrued salaries and benefits13.6
 89.8
Environmental liabilities9.7
 7.0
Customer deposits1.4
 5.6
Other40.2
 24.3
Total accrued expenses$1,870.0
 $1,642.7

PBF ENERGY INC. AND BARREL DATA)PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




PBF LLC
September 30,
2018		 December 31,
2017
Inventory-related accruals$1,451,142
 $1,151,810
Inventory intermediation agreements254,022
 244,287
Excise and sales tax payable123,174
 118,515
Accrued interest58,885
 23,419
Accrued transportation costs56,167
 64,400
Accrued salaries and benefits55,366
 58,589
Renewable energy credit and emissions obligations32,753
 26,231
Accrued utilities32,371
 42,189
Accrued capital expenditures26,082
 18,765
Accrued refinery maintenance and support costs23,147
 35,674
Customer deposits20,583
 16,133
Environmental liabilities7,173
 8,289
Other26,929
 16,093
Total accrued expenses$2,167,794
 $1,824,394

The Company has the obligation to repurchase certain intermediatescrude oil, intermediate and finished products (the “Products”) that are held in the Company’s refinery storage tanks at the Delaware City and Paulsboro refineriesStorage Tanks in accordance with the Inventory Intermediation Agreements with J. Aron. As of SeptemberJune 30, 20182019 and December 31, 2017,2018, a liability is recognized for the Inventory Intermediation Agreements and is recorded at market price for the J. Aron owned inventory held in the Company’s storage tanksStorage Tanks under the Inventory Intermediation Agreements, with any change in the market price being recorded in Cost of products and other.
The Company is subject to obligations to purchase Renewable Identification Numbers (“RINs”) required to comply with the Renewable Fuels Standard. The Company’s overall RINs obligation is based on a percentage of domestic shipments of on-road fuels as established by Environmental Protection Agency (“EPA”). To the degree the Company is unable to blend the required amount of biofuels to satisfy its RINs obligation, RINs must be purchased on the open market to avoid penalties and fines. The Company records its RINs obligation on a net basis in Accrued expenses when its RINs liability is greater than the amount of RINs earned and purchased in a given period and in Prepaid and other current assets when the amount of RINs earned and purchased is greater than the RINs liability. In addition, the Company is subject to obligations to comply with federal and state legislative and regulatory measures, including regulations in the state of California pursuant to Assembly Bill 32 (“AB32”), to address environmental compliance and greenhouse gas and other emissions. These requirements include incremental costs to operate and maintain our facilities as well as to implement and manage new emission controls and programs. Renewable energy credit and emissions obligations fluctuate with the volume of applicable product sales and timing of credit purchases.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

Early Return of Railcars
On September 30, 2018, the Company agreed to voluntarily return a portion of railcars under an operating lease in order to rationalize certain components of its railcar fleet based on prevailing market conditions in the crude oil by rail market. Under the terms of the lease amendment, the Company will pay agreed amounts in lieu of satisfaction of return conditions (the “early termination penalty”) and will pay a reduced rental fee over the remaining term of the lease. Certain of these railcars are idle and the remaining railcars will be taken out of service during the fourth quarter of 2018 and subsequently fully returned to the lessor. As a result, the Company recognized an expense of $44,571 for the three months ended September 30, 2018 included within Cost of sales consisting of (i) a $40,313 charge for the early termination penalty and (ii) a $4,258 charge related to the remaining lease payments associated with the portion of railcars within the amended lease, that were idled and out of service as of September 30, 2018. The Company has recorded a liability within Inventory-related accruals (included within Accrued expenses) for $25,843 representing the amount of the early lease termination obligation expected to be paid within the next twelve months and a liability within Other long-term liabilities for $18,728 representing the remaining amount of the obligation.
7. DEBT
2018 Revolving Credit Agreement
On May 2, 2018, PBF Holding and certain of its wholly-owned subsidiaries, as borrowers or subsidiary guarantors, replaced its existing asset-based revolving credit agreement dated as of August 15, 2014 (the “August 2014 Revolving Credit Agreement”) with a new asset-based revolving credit agreement (the “2018 Revolving Credit Agreement"). The 2018 Revolving Credit Agreement has a maximum commitment of $3,400,000, a maturity date of May 2023 and redefines certain components of the Borrowing Base (as defined in the credit agreement) to make more funding available for working capital and other general corporate purposes. Borrowings under the 2018 Revolving Credit Agreement bear interest at the Alternative Base Rate plus the Applicable Margin or at the Adjusted LIBOR Rate plus the Applicable Margin (all as defined in the credit agreement). The Applicable Margin ranges from 0.25% to 1.00% for Alternative Base Rate Loans and from 1.25% to 2.00% for Adjusted LIBOR Rate Loans, in each case depending on the Company’s corporate credit rating. In addition, an accordion feature allows for commitments of up to $3,500,000. The LC Participation Fee ranges from 1.00% to 1.75% depending on the Company’s corporate credit rating and the Fronting Fee is capped at 0.25%.
The 2018 Revolving Credit Agreement contains customary covenants and restrictions on the activities of PBF Holding and its subsidiaries, including, but not limited to, limitations on incurring additional indebtedness, liens, negative pledges, guarantees, investments, loans, asset sales, mergers, acquisitions and prepayment of other debt, distributions, dividends and the repurchase of capital stock, transactions with affiliates and the ability of PBF Holding to change the nature of its business or its fiscal year; all as defined in the credit agreement.
In addition, the 2018 Revolving Credit Agreement has a financial covenant which requires that if at any time Excess Availability, as defined in the credit agreement, is less than the greater of (i) 10% of the lesser of the then existing Borrowing Base and the then aggregate Revolving Commitments of the Lenders (the “Financial Covenant Testing Amount”), and (ii) $100,000, and until such time as Excess Availability is greater than the Financial Covenant Testing Amount and $100,000 for a period of 12 or more consecutive days, PBF Holding will not permit the Consolidated Fixed Charge Coverage Ratio, as defined in the credit agreement and determined as of the last day of the most recently completed quarter, to be less than 1.0 to 1.0.
At both September 30, 2018 and December 31, 2017, there was $350,000 outstanding under the revolving credit agreements.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

PBFX Revolving Credit Facility
On July 30, 2018, PBFX entered into an amended and restated credit facility (as amended, the “PBFX Revolving Credit Facility”). The PBFX Revolving Credit Facility has a maximum commitment available to PBFX of $500,000 and a maturity date of July 2023 that may be extended for one year on up to two occasions, subject to certain customary terms and conditions. PBFX has the ability to increase the maximum amount of the PBFX Revolving Credit Facility by an aggregate amount of up to $250,000, or a total facility size of $750,000, subject to receiving increased commitments from lenders or other financial institutions and satisfaction of certain conditions. The PBFX Revolving Credit Facility includes a $75,000 sublimit for standby letters of credit, a $25,000 sublimit for swingline loans and is guaranteed by a guaranty of collection from PBF LLC. Obligations under the PBFX Revolving Credit Facility are guaranteed by its restricted subsidiaries, and are secured by a first priority lien on PBFX’s assets and those of its restricted subsidiaries. Borrowings under the PBFX Revolving Credit Facility bear interest at the Alternative Base Rate plus the Applicable Margin or at the Adjusted LIBOR Rate plus an Applicable Margin (all as defined in the PBFX Revolving Credit Facility). The Applicable Margin ranges from 0.75% to 1.75% for Alternative Base Rate Loans and from 1.75% to 2.75% for Adjusted LIBOR Rate Loans, in each case depending on PBFX’s Consolidated Total Leverage Ratio, as defined in the PBFX Revolving Credit Facility.
At September 30, 2018 and December 31, 2017, there was $50,000 and $29,700, respectively, outstanding under the PBFX revolving credit facilities.

8.6. AFFILIATE NOTE PAYABLE - PBF LLC
As of SeptemberJune 30, 20182019 and December 31, 2017,2018, PBF LLC had an outstanding note payable with PBF Energy for an aggregate principal amount of $326,115$378.4 million and $292,844,$326.1 million, respectively. During the second quarter of 2019, the note payable was amended to extend the maturity date from April 2020 to April 2030. The note has an annual interest rate of 2.5% and a 5-year term but may be prepaid in whole or in part at any time, at the option of PBF LLC without penalty or premium.


9. INCOME TAXES
PBF Energy files federal and applicable state corporate income tax returns and recognizes income taxes on its pre-tax income, which to-date has consisted primarily of its share of PBF LLC’s pre-tax income (approximately 99.0% as of September 30, 2018 and approximately 96.7% as of December 31, 2017). PBF LLC is organized as a limited liability company and PBFX is a master limited partnership, both of which are treated as “flow-through” entities for federal income tax purposes and therefore are not subject to income taxes apart from the income tax attributable to the two subsidiaries acquired in connection with the acquisition of Chalmette Refining and PBF Holding’s wholly-owned Canadian subsidiary, PBF Ltd, that are treated as C-Corporations for income tax purposes.
The reported income tax expense in the PBF Energy condensed consolidated financial statements of operations consists of the following: 
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
 2018 2017 2018 2017
Current income tax expense$71
 $190
 $823
 $1,564
Deferred income tax expense61,278
 203,789
 167,013
 111,325
Total income tax expense$61,349
 $203,979
 $167,836
 $112,889
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT

7. COMMITMENTS AND BARREL DATA)
CONTINGENCIES


Income tax expenseIn the ordinary conduct of the Company’s business, the Company is based on income before taxes attributablefrom time to PBF Energy and excludes income before taxes attributable to noncontrolling interests as such interests are generally nottime subject to income taxes except as noted above.lawsuits, investigations and claims, including class action proceedings, mass tort actions, tort actions, environmental claims and employee-related matters. The difference between PBF Energy’s effective income tax rateoutcome of these matters cannot always be predicted accurately, but the Company accrues liabilities for these matters if the Company has determined that it is probable a loss has been incurred and the United States statutory rate is reconciled below:
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
 2018 2017 2018 2017
Provision at Federal statutory rate21.0 % 35.0 % 21.0 % 35.0 %
Increase (decrease) attributable to flow-through of certain tax adjustments:       
State income taxes (net of federal income tax)5.6 % 4.5 % 5.9 % 4.3 %
Nondeductible/nontaxable items(0.5)% (0.2)% (0.1)% 0.2 %
Rate differential from foreign jurisdictions(0.2)% 0.3 % (0.2)% (0.1)%
Provision to return adjustment— % (0.1)% — % (0.2)%
Foreign tax rate change— % — % — % 0.3 %
Other(0.4)% (0.1)% (0.8)% (0.1)%
Effective tax rate25.5 % 39.4 % 25.8 % 39.4 %
PBF Energy’s effective income tax rateloss can be reasonably estimated. For such ongoing matters for the three and nine months ended September 30, 2018, including the impact of income attributable to noncontrolling interests of $12,928 and $39,907, respectively, was 24.2% and 24.3%, respectively. PBF Energy’s effective income tax rate for the three and nine months ended September 30, 2017, including the impact of income attributable to noncontrolling interests of $32,861 and $49,420, respectively, was 37.0% and 33.6% respectively.
The decrease in effective tax rate when comparing the three and nine month periods ended September 30, 2018 to the three and nine month periods ended September 30, 2017 is primarily driven by the Tax Cuts and Jobs Act (“TCJA”), which was effective as of January 1, 2018. The TCJA significantly revised the U.S. tax code by, among other things, lowering the corporate income tax rate from 35.0% to 21.0%. In connection with the enactment of the TCJA, PBF Energywe have not recorded a net tax expenseliability but losses are reasonably possible, we are unable to estimate a range of $20,153possible losses at this time due to various reasons that may include but are not limited to, matters being in an early stage and not fully developed through pleadings, discovery or court proceedings, number of potential claimants being unknown or uncertainty regarding a number of different factors underlying the year ending December 31, 2017. It ispotential claims. However, the Company’s expectationultimate resolution of one or more of these contingencies could result in an adverse outcome that the other legislative areas within TCJA, such as the Transition Tax and the Global Low-Taxed Intangible Income, will notmay have a material impacteffect on the provision for income taxes.
The reported income tax (benefit) expense in the PBF LLC condensed consolidatedour financial statementsposition, results of operations consists of the following:
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
 2018 2017 2018 2017
Current income tax expense (benefit)$5
 $190
 $(26) $1,399
Deferred income tax (benefit) expense(724) (4,482) (5,377) 641
Total income tax (benefit) expense$(719) $(4,292) $(5,403) $2,040

The Company has determined there are no material uncertain tax positions as of September 30, 2018. The Company does not have any unrecognized tax benefits.

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

10. COMMITMENTS AND CONTINGENCIESor cash flows.
Environmental Matters
The Company’s refineries, pipelines and related operations are subject to extensive and frequently changing federal, state and local laws and regulations, including, but not limited to, those relating to the discharge of materials into the environment or that otherwise relate to the protection of the environment, waste management and the characteristics and the compositions of fuels. Compliance with existing and anticipated laws and regulations can increase the overall cost of operating the refineries, including remediation, operating costs and capital costs to construct, maintain and upgrade equipment and facilities.
In connection with the Paulsboro refinery acquisition,These laws and permits raise potential exposure to future claims and lawsuits involving environmental and safety matters which could include soil and water contamination, air pollution, personal injury and property damage allegedly caused by substances which the Company manufactured, handled, used, released or disposed of, transported, or that relate to pre-existing conditions for which the Company has assumed certainresponsibility. The Company believes that our current operations are in substantial compliance with existing environmental remediation obligations. The Paulsboroand safety requirements. However, there have been and will continue to be ongoing discussions about environmental liability of $11,253 recorded as of September 30, 2018 ($10,282 as of December 31, 2017) represents the present value of expected future costs discounted at a rate of 8.0%. The current portion of the environmental liability is recorded in Accrued expenses and the non-current portion is recorded in Other long-term liabilities. As of September 30, 2018 and December 31, 2017, this liability is self-guaranteed by the Company.
In connection with the acquisition of the Delaware City assets, Valero Energy Corporation (“Valero”) remains responsible for certain pre-acquisition environmental obligations up to $20,000 and the predecessor to Valero in ownership of the refinery retains other historical obligations.
In connection with the acquisition of the Delaware City assets and the Paulsboro refinery,safety matters between the Company and Valero purchased ten year, $75,000federal and state authorities, including notices of violations, citations and other enforcement actions, some of which have resulted or may result in changes to operating procedures and in capital expenditures. While it is often difficult to quantify future environmental insurance policies to insure against unknown environmental liabilities at each site. In connection with the Toledo refinery acquisition, Sunoco, Inc. (R&M) remains responsible for environmental remediation for conditions that existed on the closing date for twenty years from March 1, 2011, subject to certain limitations.
In connection with the acquisition of the Chalmette refinery,or safety related expenditures, the Company obtained $3,936anticipates that continuing capital investments and changes in financial assurance (inoperating procedures will be required for the form of a surety bond)foreseeable future to cover estimated potential site remediation costs associatedcomply with an agreed to Administrative Order of Consent with EPA. The estimated cost assumes remedial activities will continue for a minimum of thirty years. Further, in connection with the acquisition of the Chalmette refinery, the Company purchased a ten year, $100,000 environmental insurance policy to insure against unknown environmental liabilities at the refinery.
On December 28, 2016, DNREC issued a Coastal Zone Act permit (the “Ethanol Permit”) to DCR allowing the utilizationexisting and new requirements, as well as evolving interpretations and more strict enforcement of existing tankslaws and existing marine loading equipment at their existing facilities to enable denatured ethanol to be loaded from storage tanks to marine vessels and shipped to offsite facilities. On January 13, 2017, the issuance of the Ethanol Permit was appealed by two environmental groups. On February 27, 2017, the Coastal Zone Industrial Board (the “Coastal Zone Board”) held a public hearing and dismissed the appeal, determining that the appellants did not have standing. The appellants filed an appeal of the Coastal Zone Board’s decision with the Delaware Superior Court (the “Superior Court”) on March 30, 2017. On January 19, 2018, the Superior Court rendered an Opinion regarding the decision of the Coastal Zone Board to dismiss the appeal of the Ethanol Permit for the ethanol project. The Judge determined that the record created by the Coastal Zone Board was insufficient for the Superior Court to make a decision, and therefore remanded the case back to the Coastal Zone Board to address the deficiency in the record. Specifically, the Superior Court directed the Coastal Zone Board to address any evidence concerning whether the appellants’ claimed injuries would be affected by the increased quantity of ethanol shipments. During the hearing before the Coastal Zone Board on standing, one of the appellants’ witnesses made a reference to the flammability of ethanol, without any indication of the significance of flammability/ explosivity to specific concerns. Moreover, the appellants did not introduce at hearing any evidence of the relative flammability of ethanol as compared to other materials shipped to and from the refinery. However, the sole dissenting opinion from the Coastal Zone Board focused on the flammability/explosivity issue, alleging that the appellants’ testimony raised the issue as a distinct basis for potential harms. Once the Board responds to the remand, it will go back to the Superior Court to complete its analysis and issue a decision.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

At the time the Company acquired the Toledo refinery, EPA had initiated an investigation into the compliance of the refinery with EPA standards governing flaring pursuant to Section 114 of the Clean Air Act. On February 1, 2013, EPA issued an Amended Notice of Violation, and on September 20, 2013, EPA issued a Notice of Violation and Finding of Violation to Toledo refinery, alleging certain violations of the Clean Air Act at its Plant 4 and Plant 9 flares since the acquisition of the refinery on March 1, 2011. Toledo refinery and EPA subsequently entered into tolling agreements pending settlement discussions. Although the resolution has not been finalized, the civil administrative penalty is anticipated to be approximately $645 including supplemental environmental projects. To the extent the administrative penalty exceeds such amount, it is not expected to be material to the Company.regulations.
In connection with the acquisition of the Torrance refinery and related logistics assets, the Company assumed certain pre-existing environmental liabilities totaling $133,025$125.4 million as of SeptemberJune 30, 20182019 ($136,487130.8 million as of December 31, 2017)2018), related to certain environmental remediation obligations to address existing soil and groundwater contamination and monitoring activities and other clean-up activities, which reflects the current estimated cost of the remediation obligations. The current portion of the environmental liability is recorded in Accrued expenses and the non-current portion is recorded in Other long-term liabilities. In addition,
The accrued environmental liability reflected in connection with the acquisitionCompany’s Condensed Consolidated Balance Sheets was $139.2 million and $144.2 million at June 30, 2019 and December 31, 2018, respectively, of which $129.5 million and $137.2 million, respectively, were classified as Other long-term liabilities. These accruals include remediation and monitoring costs, related to the Torrance refinery, as discussed above, and related logisticsother operating assets, the Company purchased a ten year, $100,000 environmental insurance policyexpected to insure against unknown environmental liabilities. Furthermore, in connection with the acquisition, the Company assumed responsibility for certain specified environmental matters that occurred prior to the Company’s ownershipbe incurred over an extended period of the refinery and the logistics assets, including specified incidents and/or notices of violations (“NOVs”) issued by regulatory agencies in various years before the Company’s ownership, including the Southern California Air Quality Management District (“SCAQMD”) and the Division of Occupational Safety and Health of the State of California (“Cal/OSHA”).
In connection with the acquisition of the Torrance refinery and related logistics assets, the Company agreed to take responsibility for NOV No. P63405 that ExxonMobil had received from the SCAQMD for Title V deviations that are alleged to have occurred in 2015. On August 14, 2018, the Company received a letter from SCAQMD offering to settle this NOV for $515. The Company is currently in communication with SCAQMD to resolve this NOV.
Subsequent to the acquisition, further NOVs were issued by the SCAQMD, Cal/OSHA, the City of Torrance, the City of Torrance Fire Department, and the Los Angeles County Sanitation District related to alleged operational violations, emission discharges and/or flaring incidents at the refinery and the logistics assets both before and after the Company’s acquisition. EPA in November 2016 conducted a Risk Management Plan (“RMP”) inspection following the acquisition related to Torrance operations and issued preliminary findings in March 2017 concerning RMP potential operational violations. The Company is currently in communication with EPA to resolve the RMP preliminary findings. EPA and the California Department of Toxic Substances Control (“DTSC”) in December 2016 conducted a Resource Conservation and Recovery Act (“RCRA”) inspection following the acquisition related to Torrance operations and also issued in March 2017 preliminary findings concerning RCRA potential operational violations. In April 2017, EPA referred the RCRA preliminary findings to DTSC for final resolution. On March 1, 2018, the Company received a notice of intent to sue from Environmental Integrity Project, on behalf of Environment California, under RCRA with respect to the alleged violations from EPA’s and DTSC’s December 2016 inspection. On March 2, 2018, DTSC issued an order to correct alleged RCRA violations relating to the accumulation of oil bearing materials in roll off bins during 2016 and 2017. On June 14, 2018, the Torrance refinery and DTSC reached settlement regarding the oil bearing materialstime. Estimated liabilities could increase in the formfuture when the results of ongoing investigations become known, are considered probable and can be reasonably estimated.
During the first quarter of 2019, PBFX notified certain agencies of an oil sheen in the Schuylkill River potentially sourcing from a stipulationPBFX facility. Clean-up was immediately initiated, and order, whereinoil is no longer being released into the Torrance refinery agreed that it would recycle or properly disposewaterway. The source of the oil bearing materials by the end of 2018is currently under investigation. Although full clean-up and pay an administrative penalty of $150. Following this settlement, in June 2018, DTSC referred the remaining alleged RCRA violations from EPA’s and DTSC’s December 2016 inspection to the California Attorney General for final resolution. The Torrance refinery and the California Attorney Generalremediation costs have not been completed, such incremental costs are in discussions to resolve these remaining alleged RCRA violations. Other than the $150 DTSC administrative penalty, no other settlement or penalty demands have been received to date with respect to any of the other NOVs, preliminary findings, or order that are in excess of $100. As the ultimate outcomes are uncertain, the Company cannot currently estimate the final amount or timing of their resolution but any such amount is not expected to have abe material impact onto the Company’s financial position, results of operations or cash flows, individually or in the aggregate.Company.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

In connection with the PBFX Plains Asset Purchase, PBFX is responsible for the environmental remediation costs for conditions that existed on the closing date up to a maximum of $250 per year for ten years, with Plains All American Pipeline, L.P. remaining responsible for any and all additional costs above such amounts during such period. The environmental liability of $1,629 recorded as of September 30, 2018 ($1,923 as of December 31, 2017) represents the present value of expected future costs discounted at a rate of 1.83%. The current portion of the environmental liability is recorded in Accrued expenses and the non-current portion is recorded in Other long-term liabilities.
Applicable Federal and State Regulatory Requirements
The Company’s operations and many of the products it manufactures are subject to certain specific requirements of the Clean Air Act (the “CAA”) and related state and local regulations. The CAA contains provisions that require capital expenditures for the installation of certain air pollution control devices at the Company’s refineries. Subsequent rule making authorized by the CAA or similar laws or new agency interpretations of existing rules, may necessitate additional expenditures in future years.
In 2010, New York State adopted a Low-Sulfur Heating Oil mandate that, beginning July 1, 2012, requires all heating oil sold in New York State to contain no more than 15 parts per million (“PPM”) sulfur. Since July 1, 2012, other states in the Northeast market began requiring heating oil sold in their state to contain no more than 15 PPM sulfur. Currently, all of the Northeastern states and Washington DC have adopted sulfur controls on heating oil. Most of the Northeastern states will now require heating oil with 15 PPM or less sulfur by July 1, 2018 (except for Pennsylvania and Maryland - where less than 500 PPM sulfur is required). All of the heating oil the Company currently produces meets these specifications. The mandate and other requirements do not currently have a material impact on the Company’s financial position, results of operations or cash flows.
EPA issued the final Tier 3 Gasoline standards on March 3, 2014 under the CAA. This final rule establishes more stringent vehicle emission standards and further reduces the sulfur content of gasoline starting in January 2017. The new standard is set at 10 PPM sulfur in gasoline on an annual average basis starting January 1, 2017, with a credit trading program to provide compliance flexibility. EPA responded to industry comments on the proposed rule and maintained the per gallon sulfur cap on gasoline at the existing 80 PPM cap. The refineries are complying with these new requirements as planned, either directly or using flexibility provided by sulfur credits generated or purchased in advance as an economic optimization. The standards set by the new rule are not expected to have a material impact on the Company’s financial position, results of operations or cash flows.
The Company is required to comply with the Renewable Fuel Standard (“RFS”) implemented by EPA, which sets annual quotas for the quantity of renewable fuels (such as ethanol) that must be blended into motor fuels consumed in the United States. In July 2018, EPA issued proposed amendments to the RFS program regulations that would establish annual percentage standards for cellulosic biofuel, biomass-based diesel, advanced biofuel, and renewable fuels that would apply to all gasoline and diesel produced in the U.S. or imported in the year 2019. In addition, the separate proposal includes a proposed biomass-based diesel applicable volume for 2020. It is likely that RIN production will continue to be lower than needed forcing obligated parties, such as the Company, to purchase cellulosic waiver credits or purchase excess RINs from suppliers on the open market.
In addition, on December 1, 2015 EPA finalized revisions to an existing air regulation concerning Maximum Achievable Control Technologies (“MACT”) for Petroleum Refineries. The regulation requires additional continuous monitoring systems for eligible process safety valves relieving to atmosphere, minimum flare gas heat (Btu) content, and delayed coke drum vent controls to be installed by January 30, 2019. In addition, a program for ambient fence line monitoring for benzene was implemented prior to the deadline of January 30, 2018. The Company is in the process of implementing the requirements of this regulation. The regulation does not have a material impact on the Company’s financial position, results of operations or cash flows.
EPA published a Final Rule to the Clean Water Act (“CWA”) Section 316(b) in August 2014 regarding cooling water intake structures, which includes requirements for petroleum refineries. The purpose of this rule is to prevent fish from being trapped against cooling water intake screens (impingement) and to prevent fish from being drawn
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

through cooling water systems (entrainment). Facilities will be required to implement Best Technology Available (“BTA”) as soon as possible, but state agencies have the discretion to establish implementation time lines. The Company continues to evaluate the impact of this regulation, and at this time does not anticipate it having a material impact on the Company’s financial position, results of operations or cash flows.
As a result of the Torrance Acquisition, the Company is subject to greenhouse gas emission control regulations in the state of California pursuant to AB32. AB32 imposes a statewide cap on greenhouse gas emissions, including emissions from transportation fuels, with the aim of returning the state to 1990 emission levels by 2020. AB32 is implemented through two market mechanisms including the Low Carbon Fuel Standard (“LCFS”) and Cap and Trade, which was extended for an additional ten years to 2030 in July 2017. The Company is responsible for the AB32 obligations related to the Torrance refinery beginning on July 1, 2016 and must purchase emission credits to comply with these obligations. Additionally, in September 2016, the state of California enacted Senate Bill 32 (“SB32”) which further reduces greenhouse gas emissions targets to 40 percent below 1990 levels by 2030.
However, subsequent to the acquisition, the Company is recovering the majority of these costs from its customers, and as such does not expect this obligation to materially impact the Company’s financial position, results of operations, or cash flows. To the degree there are unfavorable changes to AB32 or SB32 regulations or the Company is unable to recover such compliance costs from customers, these regulations could have a material adverse effect on our financial position, results of operations and cash flows.
The Company is subject to obligations to purchase RINs. On February 15, 2017, the Company received a notification that EPA records indicated that PBF Holding used potentially invalid RINs that were in fact verified under EPA’s RIN Quality Assurance Program (“QAP”) by an independent auditor as QAP A RINs. Under the regulations, use of potentially invalid QAP A RINs provided the user with an affirmative defense from civil penalties provided certain conditions are met. The Company has asserted the affirmative defense and if accepted by EPA will not be required to replace these RINs and will not be subject to civil penalties under the program. It is reasonably possible that EPA will not accept the Company’s defense and may assess penalties in these matters but any such amount is not expected to have a material impact on the Company’s financial position, results of operations or cash flows.
As of January 1, 2011, the Company is required to comply with EPA’s Control of Hazardous Air Pollutants From Mobile Sources, or MSAT2, regulations on gasoline that impose reductions in the benzene content of its produced gasoline. The Company purchases benzene credits to meet these requirements. The Company’s planned capital projects will reduce the amount of benzene credits that it needs to purchase. In addition, the renewable fuel standards mandate the blending of prescribed percentages of renewable fuels (e.g., ethanol and biofuels) into the Company’s produced gasoline and diesel. These new requirements, other requirements of the CAA and other presently existing or future environmental regulations may cause the Company to make substantial capital expenditures as well as the purchase of credits at significant cost, to enable its refineries to produce products that meet applicable requirements.
The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), also known as “Superfund,” imposes liability, without regard to fault or the legality of the original conduct, on certain classes of persons who are considered to be responsible for the release of a “hazardous substance” into the environment. These persons include the current or former owner or operator of the disposal site or sites where the release occurred and companies that disposed of or arranged for the disposal of the hazardous substances. Under CERCLA, such persons may be subject to joint and several liability for investigation and the costs of cleaning up the hazardous substances that have been released into the environment, for damages to natural resources and for the costs of certain health studies. As discussed more fully above, certain of the Company’s sites are subject to these laws and the Company may be held liable for investigation and remediation costs or claims for natural resource damages. It is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by hazardous substances or other pollutants released into the environment. Analogous state laws impose similar responsibilities and liabilities on responsible parties. In the Company’s current normal operations, it has generated waste, some of which falls within the statutory definition of a “hazardous substance” and some of which may have been disposed of at sites that may require cleanup under Superfund.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

The Company is also currently subject to certain other existing environmental claims and proceedings. The Company believes that there is only a remote possibility that future costs related to any of these other known contingent liability exposures would have a material impact on its financial position, results of operations or cash flows.
PBF LLC Limited Liability Company Agreement
The holders of limited liability company interests in PBF LLC, including PBF Energy, generally have to include for purposes of calculating their U.S. federal, state and local income taxes their share of any taxable income of PBF LLC, regardless of whether such holders receive cash distributions from PBF LLC. PBF Energy ultimately may not receive cash distributions from PBF LLC equal to its share of such taxable income or even equal to the actual tax due with respect to that income. For example, PBF LLC is required to include in taxable income PBF LLC’s allocable share of PBFX’s taxable income and gains (such share to be determined pursuant to the partnership agreement of PBFX), regardless of the amount of cash distributions received by PBF LLC from PBFX, and such taxable income and gains will flow-through to PBF Energy to the extent of its allocable share of the taxable income of PBF LLC. As a result, at certain times, the amount of cash otherwise ultimately available to PBF Energy on account of its indirect interest in PBFX may not be sufficient for PBF Energy to pay the amount of taxes it will owe on account of its indirect interests in PBFX.
Taxable income of PBF LLC generally is allocated to the holders of PBF LLC units (including PBF Energy) pro-rata in accordance with their respective share of the net profits and net losses of PBF LLC. In general, PBF LLC is required to make periodic tax distributions to the members of PBF LLC, including PBF Energy, pro-rata in accordance with their respective percentage interests for such period (as determined under the amended and restated limited liability company agreement of PBF LLC), subject to available cash and applicable law and contractual restrictions (including pursuant to our debt instruments) and based on certain assumptions. Generally, these tax distributions are required to be in an amount equal to our estimate of the taxable income of PBF LLC for the year multiplied by an assumed tax rate equal to the highest effective marginal combined U.S. federal, state and local income tax rate prescribed for an individual or corporate resident in New York, New York (taking into account the nondeductibility of certain expenses). If, with respect to any given calendar year, the aggregate periodic tax distributions were less than the actual taxable income of PBF LLC multiplied by the assumed tax rate, PBF LLC is required to make a “true up” tax distribution, no later than March 15 of the following year, equal to such difference, subject to the available cash and borrowings of PBF LLC. PBF LLC generally obtains funding to pay its tax distributions by causing PBF Holding to distribute cash to PBF LLC and from distributions it receives from PBFX.
Tax Receivable Agreement
PBF Energy entered into a tax receivable agreement with the PBF LLC Series A and PBF LLC Series B Unit holdersunitholders (the “Tax Receivable Agreement”) that provides for the payment by PBF Energy to such persons of an amount equal to 85% of the amount of the benefits, if any, that PBF Energy is deemed to realize as a result of (i) increases in tax basis, as described below, and (ii) certain other tax benefits related to entering into the Tax Receivable Agreement, including tax benefits attributable to payments under the Tax Receivable Agreement. For purposes of the Tax Receivable Agreement, the benefits deemed realized by PBF Energy will be computed by comparing the actual income tax liability of PBF Energy (calculated with certain assumptions) to the amount of such taxes that PBF Energy would have been required to pay had there been no increase to the tax basis of the assets of PBF LLC as a result of purchases or exchanges of PBF LLC Series A Units for shares of PBF Energy’sEnergy Class A common stock and had PBF Energy not entered into the Tax Receivable Agreement. The term of the Tax Receivable Agreement will continue until all such tax benefits have been utilized or expired unless: (i) PBF Energy exercises its right to terminate the Tax Receivable Agreement, (ii) PBF Energy breaches any of its material obligations under the Tax Receivable Agreement or (iii) certain changes of control occur, in which case all obligations under the Tax Receivable Agreement will generally be accelerated and due as calculated under certain assumptions.
The payment obligations under the Tax Receivable Agreement are obligations of PBF Energy and not of PBF LLC, PBF Holding or PBFX. In general, PBF Energy expects to obtain funding for these annual payments from PBF LLC, primarily through tax distributions, which PBF LLC makes on a pro-rata basis to its owners. Such owners
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

include PBF Energy, which holds a 99.0% interest in PBF LLC as of SeptemberJune 30, 2018 (96.7%2019 (99.0% as of December 31, 2017)2018). PBF LLC generally obtains funding to pay its tax distributions by causing PBF Holding to distribute cash to PBF LLC and from distributions it receives from PBFX.
As of SeptemberJune 30, 2018,2019, PBF Energy has recognized a liability for the Tax Receivable Agreement of $381,260$373.5 million ($362,142373.5 million as of December 31, 2017)2018) reflecting the estimate of the undiscounted amounts that the Company expects to pay under the agreement.
11.
8. LEASES
The Company leases office space, office equipment, refinery facilities and equipment, railcars and other logistics assets primarily under non-cancelable operating leases, with terms typically ranging from one to twenty years, subject to certain renewal options as applicable. The Company considers those renewal or termination options that are reasonably certain to be exercised in the determination of the lease term and initial measurement of lease liabilities and right-of-use assets. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet.
The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the Company’s leases do not provide a readily determinable implicit rate. Therefore, the Company must discount lease payments based on an estimate of its incremental borrowing rate.
The Company does not separate lease and nonlease components of contracts. There are no material residual value guarantees associated with any of the Company’s leases. There are no significant restrictions or covenants included in the Company’s lease agreements other than those that are customary in such arrangements. Certain of the Company’s leases, primarily for the Company’s commercial and logistics asset classes, include provisions for variable payments. These variable payments are typically determined based on a measure of throughput or actual days the asset is operated during the contract term or another measure of usage and are not included in the initial measurement of lease liabilities and right-of-use assets.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Lease Position as of June 30, 2019
The table below presents the lease related assets and liabilities recorded on the Company’s Condensed Consolidated Balance Sheets as of June 30, 2019:
(in millions) Classification on the Balance Sheet June 30, 2019
Assets    
Operating lease assets Operating lease right of use assets $236.9
Finance lease assets Deferred charges and other assets, net 14.2
Total lease right of use assets   $251.1
     
Liabilities    
Current liabilities:    
Operating lease liabilities Current operating lease liabilities $80.2
Finance lease liabilities Accrued expenses 1.1
Noncurrent liabilities:    
Operating lease liabilities Long-term operating lease liabilities 156.1
Finance lease liabilities Other long-term liabilities 13.3
Total lease liabilities   $250.7

Lease Costs
The table below presents certain information related to costs for the Company’s leases for the three and six months ended June 30, 2019:
Lease Costs (in millions)
 Three Months Ended June 30, 2019 Six Months Ended June 30, 2019
Components of total lease cost:    
Finance lease cost 
 
Amortization of right of use assets $0.4
 $0.4
Interest on lease liabilities 0.2
 0.2
Operating lease cost 26.0
 52.2
Short-term lease cost 25.1
 48.4
Variable lease cost 2.1
 3.5
Total lease cost $53.8
 $104.7


There were no net gains or losses on any sale-leaseback transactions for the three and six months ended June 30, 2019.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Other Information
The table below presents supplemental cash flow information related to leases for the six months ended June 30, 2019:
(in millions) Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:  
Operating cash flows for operating leases $52.0
Operating cash flows for finance leases 0.2
Financing cash flows for finance leases 0.2
Supplemental non-cash amounts of lease liabilities arising from obtaining right-of-use assets 46.2

Lease Term and Discount Rate
The table below presents certain information related to the weighted average remaining lease term and weighted average discount rate for the Company’s leases as of June 30, 2019:
June 30, 2019
Weighted average remaining lease term - operating leases5.5 years
Weighted average remaining lease term - finance leases9.8 years
Weighted average discount rate - operating leases7.97%
Weighted average discount rate - finance leases6.83%

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Undiscounted Cash Flows
The table below reconciles the fixed component of the undiscounted cash flows for each of the first five years and the total remaining years to the lease liabilities recorded on the Condensed Consolidated Balance Sheets as of June 30, 2019:
Amounts due within twelve months of June 30, (in millions)
 Finance Leases Operating Leases
2019 $2.0
 $95.3
2020 2.0
 68.3
2021 2.0
 30.9
2022 2.0
 22.8
2023 2.0
 18.6
Thereafter 9.8
 68.0
Total minimum lease payments 19.8
 303.9
Less: effect of discounting 5.4
 67.6
Present value of future minimum lease payments 14.4
 236.3
Less: current obligations under leases 1.1
 80.2
Long-term lease obligations $13.3
 $156.1

As of June 30, 2019, the Company has entered certain leases that have not yet commenced. Such leases include a 15-year lease for hydrogen supply, with future lease payments estimated to total approximately $212.6 million, expected to commence in the second quarter of 2020, and a 30-year lease for use of port facilities, with future lease payments estimated to total approximately $238.6 million, expected to commence in the third quarter of 2019. There are no material lease arrangements, in which the Company is the lessor.

9. EQUITY
Noncontrolling Interest in PBF LLC
PBF Energy is the sole managing member of, and has a controlling interest in, PBF LLC. As the sole managing member of PBF LLC, PBF Energy operates and controls all of the business and affairs of PBF LLC and its subsidiaries. PBF Energy’s equity interest in PBF LLC was approximately 99.0% as of June 30, 2019 and December 31, 2018, respectively.
PBF Energy consolidates the financial results of PBF LLC and its subsidiaries, and records a noncontrolling interest for the economic interest in PBF Energy held by the members of PBF LLC other than PBF Energy. Noncontrolling interest on the Condensed Consolidated Statements of Operations includes the portion of net income or loss attributable to the economic interest in PBF Energy held by the members of PBF LLC other than PBF Energy. Noncontrolling interest on the Condensed Consolidated Balance Sheets represents the portion of net assets of PBF Energy attributable to the members of PBF LLC other than PBF Energy.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


The noncontrolling interest ownership percentages in PBF LLC as of June 30, 2019 and December 31, 2018 are calculated as follows:
 Holders of PBF LLC Series A Units Outstanding Shares of PBF Energy Class A Common Stock 
Total *
December 31, 20181,206,325
 119,874,191
 121,080,516
 1.0% 99.0% 100.0%
June 30, 20191,206,325
 119,894,441
 121,100,766
 1.0% 99.0% 100.0%
——————————
*Assumes all of the holders of PBF LLC Series A Units exchange their PBF LLC Series A Units for shares of PBF Energy’s Class A common stock on a one-for-one basis.
Noncontrolling Interest in PBFX
PBF LLC held a 48.2% limited partner interest in PBFX with the remaining 51.8% limited partner interest owned by the public common unitholders as of June 30, 2019. PBF LLC is also the sole member of PBF GP, the general partner of PBFX. As noted in “Note 2 - PBF Logistics LP”, pursuant to the IDR Restructuring, the IDRs held by PBF LLC were canceled and converted into newly issued common units. In addition, PBFX issued 6,585,500 common units to certain institutional investors in connection with the PBFX Registered Direct Offering on April 29, 2019.
PBF Energy, through its ownership of PBF LLC, consolidates the financial results of PBFX, and records a noncontrolling interest for the economic interest in PBFX held by the public common unitholders. Noncontrolling interest on the Condensed Consolidated Statements of Operations includes the portion of net income or loss attributable to the economic interest in PBFX held by the public common unitholders of PBFX other than PBF Energy (through its ownership in PBF LLC). Noncontrolling interest on the Condensed Consolidated Balance Sheets includes the portion of net assets of PBFX attributable to the public common unitholders of PBFX.
The noncontrolling interest ownership percentages in PBFX as of December 31, 2018, the closing of the PBFX Registered Direct Offering and June 30, 2019 are calculated as follows:

Units of PBFX Held by the Public
Units of PBFX Held by PBF LLC
Total
December 31, 201825,395,032
 19,953,631
 45,348,663

56.0% 44.0% 100.0%
April 29, 2019 - PBFX Registered Direct Offering32,047,718
 29,953,631
 62,001,349
 51.7% 48.3% 100.0%
June 30, 201932,153,579
 29,953,631
 62,107,210
 51.8% 48.2% 100.0%

Noncontrolling Interest in PBF Holding
In connection with the Chalmette Acquisition, PBF Holding recorded noncontrolling interests in two subsidiaries of Chalmette Refining. PBF Holding, through Chalmette Refining, owns an 80% ownership interest in both Collins Pipeline Company and T&M Terminal Company. In both the three and six months ended June 30, 2019 and 2018 the Company recorded noncontrolling interest in the earnings of these subsidiaries of less than $0.2 million.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Changes in Equity and Noncontrolling Interests
The following tables summarize the changes in equity for the controlling and noncontrolling interests of PBF Energy for the six months ended June 30, 2019 and 2018, respectively:


PBF Energy (in millions)
PBF Energy Inc. Equity Noncontrolling
Interest in PBF LLC		 
Noncontrolling
Interest in PBF Holding
 Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2019$2,676.5
 $112.2
 $10.9
 $448.9
 $3,248.5
Comprehensive income197.6
 2.8
 0.1
 20.0
 220.5
Dividends and distributions(71.9) (2.3) —
 (30.0) (104.2)
Issuance of additional PBFX common units152.0

—

—

(19.5) 132.5
Stock-based compensation13.9
 —
 —
 4.4
 18.3
Exercise of PBF LLC and PBF Energy options and warrants, net0.2

—

—
 —
 0.2
Other(0.9) —
 —
 (1.8) (2.7)
Balance at June 30, 2019$2,967.4
 $112.7
 $11.0
 $422.0
 $3,513.1

PBF Energy (in millions)
PBF Energy Inc. Equity Noncontrolling
Interest in PBF LLC		 
Noncontrolling
Interest in PBF Holding
 Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2018$2,336.6
 $110.2
 $10.8
 $445.3
 $2,902.9
Comprehensive income302.8
 7.4
 —
 19.6
 329.8
Dividends and distributions(67.3) (1.4) —
 (23.6) (92.3)
Effects of exchanges of PBF LLC Series A Units on deferred tax assets and liabilities and Tax Receivable Agreement obligation(2.4) —
 —
 —
 (2.4)
Stock-based compensation9.5
 —
 —
 3.5
 13.0
Exercise of PBF LLC and PBF Energy options and warrants, net11.7
 (0.3) —
 —
 11.4
Other10.9
 —
 —
 (1.0) 9.9
Balance at June 30, 2018$2,601.8
 $115.9
 $10.8
 $443.8
 $3,172.3
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


The following tables summarize the changes in equity for the controlling and noncontrolling interests of PBF LLC for the six months ended June 30, 2019 and 2018, respectively:
PBF LLC (in millions)
PBF Energy Company LLC Equity Noncontrolling Interest in PBF Holding Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2019$2,759.6
 $10.9
 $448.9
 $3,219.4
Comprehensive income272.1
 0.1
 20.0
 292.2
Dividends and distributions(127.5) —
 (30.0) (157.5)
Exercise of PBF LLC options and warrants, net(0.7) —
 —
 (0.7)
Issuance of additional PBFX common units152.0

—

(19.5) 132.5
Stock-based compensation13.9

—

4.4
 18.3
Other—
—
—
—
(1.8) (1.8)
Balance at June 30, 2019$3,069.4
 $11.0
 $422.0
 $3,502.4
PBF LLC (in millions)
PBF Energy Company LLC Equity Noncontrolling
Interest in PBF Holding		 Noncontrolling
Interest in PBFX		 Total Equity
Balance at January 1, 2018$2,422.4
 $10.8
 $445.3
 $2,878.5
Comprehensive income418.1
 —
 19.6
 437.7
Dividends and distributions(68.7) —
 (23.6) (92.3)
Stock-based compensation9.5
 —
 3.5
 13.0
Exercise of PBF LLC and PBF Energy options and warrants, net(3.3) —
 —
 (3.3)
Other10.9
 —
 (1.0) 9.9
Balance at June 30, 2018$2,788.9
 $10.8
 $443.8
 $3,243.5







PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


10. DIVIDENDS AND DISTRIBUTIONS
With respect to dividends and distributions paid during the ninesix months ended SeptemberJune 30, 2018,2019, PBF LLC made an aggregate non-tax quarterly distributionsdistribution of $104,739,$72.7 million, or $0.30 per unit to its members, of which $103,015$71.9 million was distributed pro-rata to PBF Energy and the balance was distributed to its other members. PBF Energy used this $103,015$71.9 million to pay a quarterly cash dividendsdividend of $0.30 per share of Class A common stock on both March 14, 2018,2019 and May 30, 2018 and August2019. In addition, during the six months ended June 30, 2018.2019, PBF LLC made aggregate tax distributions to its members of $54.8 million, of which $53.2 million was made to PBF Energy.


With respect to distributions paid during the ninesix months ended SeptemberJune 30, 2018,2019, PBFX paid a distribution on outstanding common units of $0.485$0.505 per unit on March 14, 2018, $0.4902019 and $0.510 per unit on May 30, 2018 and $0.495 per unit on August 30, 2018,2019, of which $36,981$30.4 million was distributed to PBF LLC and the balance was distributed to its public unitholders.


12.11. EMPLOYEE BENEFIT PLANS
The components of net periodic benefit cost related to the Company’s defined benefit plans consisted of the following:
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
(in millions) Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
Pension Benefits 2018 2017 2018
2017 2019 2018 2019
2018
Components of net periodic benefit cost:                
Service cost $11,836
 $10,142
 $35,508
 $30,429
 $10.9
 $11.8
 $21.8
 $23.6
Interest cost 1,448
 1,084
 4,344
 3,252
 2.1
 1.4
 4.2
 2.8
Expected return on plan assets (2,135) (1,441) (6,405) (4,325) (2.4) (2.1) (4.8) (4.2)
Amortization of prior service cost 22
 13
 65
 39
Amortization of actuarial loss 71
 113
 214
 339
Amortization of prior service cost and actuarial loss —
 0.1
 0.1
 0.2
Net periodic benefit cost $11,242
 $9,911
 $33,726
 $29,734
 $10.6
 $11.2
 $21.3
 $22.4
(in millions)Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
Post-Retirement Medical Plan2019 2018 2019 2018
Components of net periodic benefit cost:       
Service cost$0.3
 $0.2
 $0.5
 $0.5
Interest cost0.1
 0.3
 0.3
 0.4
Amortization of prior service cost0.2
 0.1
 0.3
 0.3
Net periodic benefit cost$0.6
 $0.6
 $1.1
 $1.2

 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
Post-Retirement Medical Plan2018 2017 2018 2017
Components of net periodic benefit cost:       
Service cost$287
 $316
 $861
 $948
Interest cost155
 172
 465
 516
Amortization of prior service cost161
 162
 484
 484
Net periodic benefit cost$603
 $650
 $1,810
 $1,948


The Company adopted ASU 2017-07 as described in “Note 1 - Description of the Business and Basis of Presentation” effective January 1, 2018. The new guidance requires the bifurcation of net periodic benefit cost. The service cost component is presented within Income from operations, while the other components are reported separately outside of operations. This guidance was applied retrospectively in the Condensed Consolidated Statements of Operations. For the three and nine months ended September 30, 2018, the Company recorded income of $278 and $833,
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


respectively, related12. REVENUES
Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
As described in “Note 16 - Segment Information”, the Company’s business consists of the Refining Segment and Logistics Segment. The following table provides information relating to the non-service componentsCompany’s revenues for each product or group of net periodic benefit costsimilar products or services by segment for the periods presented.
 Three Months Ended June 30,
(in millions)2019 2018
Refining Segment:   
Gasoline and distillates$5,570.7
 $6,341.8
Asphalt and blackoils531.8
 397.2
Feedstocks and other203.9
 403.2
Chemicals177.6
 202.6
Lubricants67.9
 94.8
Total6,551.9
 7,439.6
Logistics Segment:   
Logistics82.8
 68.1
Total revenue prior to eliminations6,634.7
 7,507.7
Elimination of intercompany revenue(74.7) (63.6)
Total Revenues$6,560.0
 $7,444.1
 Six Months Ended June 30,
(in millions)2019 2018
Refining Segment:   
Gasoline and distillates$10,003.7
 $11,336.1
Asphalt and blackoils884.8
 706.1
Feedstocks and other404.6
 641.4
Chemicals329.3
 378.7
Lubricants138.2
 176.4
Total11,760.6
 13,238.7
Logistics Segment:   
Logistics161.6
 132.8
Total revenue prior to eliminations11,922.2
 13,371.5
Elimination of intercompany revenue(146.0) (124.6)
Total Revenues$11,776.2
 $13,246.9


PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


The majority of the Company’s revenues are generated from the sale of refined petroleum products reported in Other income (expense)the Refining segment. These revenues are largely based on the current spot (market) prices of the products sold, which represent consideration specifically allocable to the products being sold on a given day, and the Company recognizes those revenues upon delivery and transfer of title to the products to our customers. The time at which delivery and transfer of title occurs is the point when the Company’s control of the products is transferred to the Company’s customers and when its performance obligation to its customers is fulfilled. Delivery and transfer of title are specifically agreed to between the Company and customers within the contracts. The Refining segment also has contracts which contain fixed pricing, tiered pricing, minimum volume features with makeup periods, or other factors that have not materially been affected by ASC 606.
Logistics segment revenue is generated by charging fees for crude oil and refined products terminaling, storage and pipeline services based on the greater of contractual minimum volume commitments, as applicable, or the delivery of actual volumes based on contractual rates applied to throughput or storage volumes. A majority of the Company’s logistics revenues are generated by intercompany transactions and are eliminated in consolidation.
Deferred Revenues
The Company records deferred revenues when cash payments are received or are due in advance of performance, including amounts which are refundable. Deferred revenue was $25.3 million and $20.1 million as of June 30, 2019 and December 31, 2018, respectively. Fluctuations in the deferred revenue balance are primarily driven by the timing and extent of cash payments received or due in advance of satisfying the Company’s performance obligations.
The Company’s payment terms vary by type and location of customers and the products offered. The period between invoicing and when payment is due is not significant (i.e. generally within two months). For the threecertain products or services and nine months ended September 30, 2017,customer types, the Company recorded expense of $103 and $305, respectively, relatedrequires payment before the products or services are delivered to the non-service components of net periodic benefit cost in Other income (expense).customer.


13. INCOME TAXES
PBF Energy files federal and applicable state corporate income tax returns and recognizes income taxes on its pre-tax income, which to date has consisted primarily of its share of PBF LLC’s pre-tax income (approximately 99.0% as of June 30, 2019 and December 31, 2018, respectively). PBF LLC is organized as a limited liability company and PBFX is an MLP, both of which are treated as “flow-through” entities for federal income tax purposes and therefore are not subject to income taxes apart from the income tax attributable to the two subsidiaries acquired in connection with the acquisition of Chalmette Refining and PBF Holding’s wholly-owned Canadian subsidiary, PBF Ltd, that are treated as C-Corporations for income tax purposes.
The reported income tax provision in the PBF Energy Condensed Consolidated Statements of Operations consists of the following: 
 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
(in millions)2019 2018 2019 2018
Current income tax (benefit) expense$(0.2) $0.7
 $1.8
 $0.8
Deferred income tax (benefit) expense(10.3) 94.8
 68.2
 105.7
Total income tax (benefit) expense$(10.5) $95.5
 $70.0
 $106.5

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



The income tax provision is based on earnings before taxes attributable to PBF Energy and excludes earnings before taxes attributable to noncontrolling interests as such interests are generally not subject to income taxes except as noted above. The difference between PBF Energy’s effective income tax rate and the United States statutory rate is reconciled below:
 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
 2019 2018 2019 2018
Provision at Federal statutory rate21.0 % 21.0 % 21.0 % 21.0 %
Increase (decrease) attributable to flow-through of certain tax adjustments:       
State income taxes (net of federal income tax)2.0 % 5.6 % 5.5 % 5.6 %
Nondeductible/nontaxable items(3.4)% 0.1 % 0.7 % 0.1 %
Rate differential from foreign jurisdictions2.4 % (0.2)% (0.7)% (0.2)%
Other2.6 % (0.5)% (0.3)% (0.5)%
Effective tax rate24.6 % 26.0 % 26.2 % 26.0 %

PBF Energy’s effective income tax rate for the three and six months ended June 30, 2019, including the impact of income attributable to noncontrolling interests of $10.6 million and $22.8 million, respectively, was 32.7% and 24.2%, respectively. PBF Energy’s effective income tax rate for the three and six months ended June 30, 2018, including the impact of income attributable to noncontrolling interests of $15.6 million and $27.0 million, respectively, was 24.9% and 24.4%, respectively.
The reported income tax provision in the PBF LLC Condensed Consolidated Statements of Operations consists of the following:
 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
(in millions)2019 2018 2019 2018
Current income tax benefit$(0.1) $—
 $(0.1) $—
Deferred income tax expense (benefit)1.9
 (4.0) (5.3) (4.7)
Total income tax expense (benefit)$1.8
 $(4.0) $(5.4) $(4.7)

The Company has determined there are no material uncertain tax positions as of June 30, 2019. The Company does not have any unrecognized tax benefits.

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


14. FAIR VALUE MEASUREMENTS
The tables below present information about the Company’s financial assets and liabilities measured and recorded at fair value on a recurring basis and indicate the fair value hierarchy of the inputs utilized to determine the fair values as of SeptemberJune 30, 20182019 and December 31, 20172018.
We haveThe Company has elected to offset the fair value amounts recognized for multiple derivative contracts executed with the same counterparty; however, fair value amounts by hierarchy level are presented on a gross basis in the tables below. We haveThe Company has posted cash margin with various counterparties to support hedging and trading activities. The cash margin posted is required by counterparties as collateral deposits and cannot be offset against the fair value of open contracts except in the event of default. We haveThe Company has no derivative contracts that are subject to master netting arrangements that are reflected gross on the balance sheet.Condensed Consolidated Balance Sheets.
As of September 30, 2018As of June 30, 2019
Fair Value Hierarchy Total Gross Fair Value Effect of Counter-party Netting Net Carrying Value on Balance SheetFair Value Hierarchy Total Gross Fair Value Effect of Counter-party Netting Net Carrying Value on Balance Sheet
Level 1 Level 2 Level 3 
(in millions)Level 1 Level 2 Level 3 Total Gross Fair Value Effect of Counter-party Netting Net Carrying Value on Balance Sheet
Assets:                 
Money market funds$396,998
 $—
 $—
 $396,998
 N/A
 $396,998
$11.1
 $—
 $—
 $11.1
 N/A
 $11.1
Commodity contracts17,023
 1,702
 —
 18,725
 (18,725) —
22.4
 8.4
 —
 30.8
 (11.8) 19.0
Liabilities:                      
Commodity contracts24,202
 21,895
 —
 46,097
 (18,725) 27,372
11.2
 0.6
 —
 11.8
 (11.8) —
Catalyst lease obligations—
 43,800
 —
 43,800
 —
 43,800
—
 45.8
 —
 45.8
 —
 45.8
Derivatives included with inventory intermediation agreement obligations—
 18,422
 —
 18,422
 —
 18,422
—
 10.9
 —
 10.9
 —
 10.9
 As of December 31, 2018
 Fair Value Hierarchy Total Gross Fair Value Effect of Counter-party Netting Net Carrying Value on Balance Sheet
(in millions)Level 1 Level 2 Level 3 
Assets:           
Money market funds$16.7
 $—
 $—
 $16.7
 N/A
 $16.7
Commodity contracts1.2
 8.9
 —
 10.1
 (2.9) 7.2
Derivatives included with inventory intermediation agreement obligations—
 24.1
 —
 24.1
 —
 24.1
Liabilities:           
Commodity contracts2.7
 0.2
 —
 2.9
 (2.9) —
Catalyst lease obligations—
 44.3
 —
 44.3
 —
 44.3
 As of December 31, 2017
 Fair Value Hierarchy Total Gross Fair Value Effect of Counter-party Netting Net Carrying Value on Balance Sheet
 Level 1 Level 2 Level 3 
Assets:           
Money market funds$4,730
 $—
 $—
 $4,730
 N/A
 $4,730
Commodity contracts10,031
 357
 —
 10,388
 (10,388) —
Liabilities:           
Commodity contracts51,673
 33,035
 —
 84,708
 (10,388) 74,320
Catalyst lease obligations—
 59,048
 —
 59,048
 —
 59,048
Derivatives included with inventory intermediation agreement obligations—
 7,721
 —
 7,721
 —
 7,721

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


The valuation methods used to measure financial instruments at fair value are as follows:
Money market funds categorized in Level 1 of the fair value hierarchy are measured at fair value based on quoted market prices and included within Cash and cash equivalents.
The commodity contracts categorized in Level 1 of the fair value hierarchy are measured at fair value based on quoted prices in an active market. The commodity contracts categorized in Level 2 of the fair value hierarchy are measured at fair value using a market approach based upon future commodity prices for similar instruments quoted in active markets.
The commodity contracts categorized in Level 3 of the fair value hierarchy consist of commodity price swap contracts that relate to forecasted purchases of crude oil for which quoted forward market prices are not readily available due to market illiquidity. The forward prices used to value these swaps were derived using broker quotes, prices from other third party sources and other available market based data.
The derivatives included with inventory intermediation agreement obligations and the catalyst lease obligations are categorized in Level 2 of the fair value hierarchy and are measured at fair value using a market approach based upon commodity prices for similar instruments quoted in active markets.


Non-qualified pension plan assets are measured at fair value using a market approach based on published net asset values of mutual funds as a practical expedient. As of SeptemberJune 30, 20182019 and December 31, 2017, $9,4272018, $10.2 million and $9,593,$9.7 million, respectively, were included within Deferred charges and other assets, net for these non-qualified pension plan assets.
The table below summarizes the changes in fair value measurements of commodity contracts categorized in Level 3 of the fair value hierarchy:
  Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
  2018 2017 2018 2017
Balance at beginning of period $—
 $—
 $—
 $(84)
Purchases —
 —
 —
 —
Settlements —
 —
 —
 45
Unrealized gain included in earnings —
 —
 —
 39
Transfers into Level 3 —
 —
 —
 —
Transfers out of Level 3 —
 —
 —
 —
Balance at end of period $—
 $—
 $—
 $—

There were no transfers between levels during the three and ninesix months ended SeptemberJune 30, 20182019 or 2017.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

2018.
Fair value of debt
The table below summarizes the fair value and carrying value of debt as of SeptemberJune 30, 20182019 and December 31, 2017.2018.
September 30, 2018 December 31, 2017June 30, 2019 December 31, 2018
Carrying
value
 
Fair
 value
 
Carrying
 value
 
Fair
value
(in millions)
Carrying
value
 
Fair
 value
 
Carrying
 value
 
Fair
value
2025 Senior Notes (a)$725,000
 $767,282
 $725,000
 $763,945
$725.0
 $759.6
 $725.0
 $688.4
2023 Senior Notes (a)500,000
 522,798
 500,000
 522,101
500.0
 519.6
 500.0
 479.4
PBFX 2023 Senior Notes (a)527,962
 539,494
 528,374
 544,118
527.5
 542.8
 527.8
 515.3
PBF Rail Term Loan (b)23,273
 23,273
 28,366
 28,366
18.1
 18.1
 21.6
 21.6
Catalyst leases (c)43,800
 43,800
 59,048
 59,048
45.8
 45.8
 44.3
 44.3
PBFX Revolving Credit Facility (b) (d)50,000
 50,000
 29,700
 29,700
Revolving Credit Agreement (b)350,000
 350,000
 350,000
 350,000
PBFX Revolving Credit Facility (b)251.0
 251.0
 156.0
 156.0
2,220,035
 2,296,647
 2,220,488
 2,297,278
2,067.4
 2,136.9
 1,974.7
 1,905.0
Less - Current debt (c)(1,242) (1,242) (10,987) (10,987)(1.3) (1.3) (2.4) (2.4)
Less - Unamortized deferred financing costs(42,904) n/a
 (34,459) n/a
(36.7) n/a
 (41.0) n/a
Long-term debt$2,175,889
 $2,295,405
 $2,175,042
 $2,286,291
$2,029.4
 $2,135.6
 $1,931.3
 $1,902.6


(a) The estimated fair value, categorized as a Level 2 measurement, was calculated based on the present value of future expected payments utilizing implied current market interest rates based on quoted prices of the 7.00% senior notes due 2023, the 7.25% senior notes due 2025 (collectively with the senior notes due 2023, the “Senior Notes”), and the PBFX 6.875% senior notes due 2023 (the “PBFX 2023 Senior Notes”).
(b) The estimated fair value approximates carrying value, categorized as a Level 2 measurement, as these borrowings bear interest based upon short-term floating market interest rates.
(c) Catalyst leases are valued using a market approach based upon commodity prices for similar instruments quoted in active markets and are categorized as a Level 2 measurement. The Company has elected the fair value option for accounting for its catalyst lease repurchase obligations as the Company’s liability is directly impacted by the change in fair value of the underlying catalyst. During 2017, Delaware City2018, Toledo Refining and Chalmette Refining entered into two platinum bridge leases which were settled during the second quarter ofin April 2019 and were not renewed. During 2018, and the CompanyDelaware City Refining entered into a new platinum bridge lease, which will expire in the firstthird quarter of 2019. This lease
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


is payable at maturity and is not anticipated to be renewed. The total outstanding balance related to these bridge leases as of SeptemberJune 30, 20182019 and December 31, 20172018 was $1,242$1.3 million and $10,987,$2.4 million, respectively, and is included in Current debt onin the Company’s Condensed Consolidated balance sheet.
(d) On October 1, 2018, PBFX borrowed $75,000 to fund the East Coast Storage Acquisition. Refer to “Note 17 - Subsequent Events” for more details.Balance Sheets.
14.15. DERIVATIVES
The Company uses derivative instruments to mitigate certain exposures to commodity price risk. The Company entered into Inventory Intermediation Agreements that contain purchase obligations for certain volumes of crude oil, intermediates and refined products. The purchase obligations related to crude oil, intermediates and refined products under these agreements are derivative instruments that have been designated as fair value hedges in order to hedge the commodity price volatility of certain refinery inventory. The fair value of these purchase obligation derivatives is based on market prices of the underlying crude oil, intermediates and refined products. The level of activity for these derivatives is based on the level of operating inventories.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

As of SeptemberJune 30, 2018,2019, there were 2,966,904496,153 barrels of crude oil and feedstocks (no barrels at December 31, 2018) outstanding under these derivative instruments designated as fair value hedges. As of June 30, 2019, there were 3,418,263 barrels of intermediates and refined products (3,000,142(3,350,166 barrels at December 31, 2017)2018) outstanding under these derivative instruments designated as fair value hedges. These volumes represent the notional value of the contract.
The Company also enters into economic hedges primarily consisting of commodity derivative contracts that are not designated as hedges and are used to manage price volatility in certain crude oil and feedstock inventories as well as crude oil, feedstock, and refined product sales or purchases. The objective in entering into economic hedges is consistent with the objectives discussed above for fair value hedges. As of SeptemberJune 30, 2018,2019, there were 11,126,00012,167,000 barrels of crude oil and 3,097,0006,481,000 barrels of refined products (22,348,000(5,801,000 and 1,989,000,1,609,000, respectively, as of December 31, 2017)2018), outstanding under short and long term commodity derivative contracts not designated as hedges representing the notional value of the contracts.
The following tables provide information about the fair values of these derivative instruments as of SeptemberJune 30, 20182019 and December 31, 20172018 and the line items in the condensed consolidated balance sheetCondensed Consolidated Balance Sheets in which the fair values are reflected.
Description

Balance Sheet Location
Fair Value
Asset/(Liability)
  (in millions)
Derivatives designated as hedging instruments:  
June 30, 2019:  
Derivatives included with the inventory intermediation agreement obligationsAccrued expenses$(10.9)
December 31, 2018:  
Derivatives included with the inventory intermediation agreement obligationsAccrued expenses$24.1
   
Derivatives not designated as hedging instruments:  
June 30, 2019:  
Commodity contractsAccounts receivable$19.0
December 31, 2018:  
Commodity contractsAccounts receivable$7.2
Description

Balance Sheet Location
Fair Value
Asset/(Liability)
Derivatives designated as hedging instruments:  
September 30, 2018:  
Derivatives included with the inventory intermediation agreement obligationsAccrued expenses$(18,422)
December 31, 2017:  
Derivatives included with the inventory intermediation agreement obligationsAccrued expenses$(7,721)
   
Derivatives not designated as hedging instruments:  
September 30, 2018:  
Commodity contractsAccrued expenses$(27,372)
December 31, 2017:  
Commodity contractsAccrued expenses$(74,320)

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


The following table provides information about the gains or losses recognized in income on these derivative instruments and the line items in the condensed consolidated statementsCondensed Consolidated Statements of operationsOperations in which such gains and losses are reflected.
Description
Location of Gain or (Loss) Recognized in
 Income on Derivatives
Gain or (Loss)
Recognized in
Income on Derivatives
  (in millions)
Derivatives designated as hedging instruments:  
For the three months ended June 30, 2019:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(20.8)
For the three months ended June 30, 2018:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$6.3
For the six months ended June 30, 2019:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(35.0)
For the six months ended June 30, 2018:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(2.5)
   
Derivatives not designated as hedging instruments:  
For the three months ended June 30, 2019:  
Commodity contractsCost of products and other$1.0
For the three months ended June 30, 2018:  
Commodity contractsCost of products and other$(33.1)
For the six months ended June 30, 2019:  
Commodity contractsCost of products and other$32.7
For the six months ended June 30, 2018:  
Commodity contractsCost of products and other$(46.4)
   
Hedged items designated in fair value hedges:  
For the three months ended June 30, 2019:  
Crude oil, intermediate and refined product inventoryCost of products and other$20.8
For the three months ended June 30, 2018:  
Intermediate and refined product inventoryCost of products and other$(6.3)
For the six months ended June 30, 2019:  
Crude oil, intermediate and refined product inventoryCost of products and other$35.0
For the six months ended June 30, 2018:  
Intermediate and refined product inventoryCost of products and other$2.5

Description
Location of Gain or (Loss) Recognized in
 Income on Derivatives
Gain or (Loss)
Recognized in
Income on Derivatives
Derivatives designated as hedging instruments:  
For the three months ended September 30, 2018:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(8,163)
For the three months ended September 30, 2017:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(29,766)
For the nine months ended September 30, 2018:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(10,701)
For the nine months ended September 30, 2017:  
Derivatives included with the inventory intermediation agreement obligationsCost of products and other$(26,659)
   
Derivatives not designated as hedging instruments:  
For the three months ended September 30, 2018:  
Commodity contractsCost of products and other$(9,517)
For the three months ended September 30, 2017:  
Commodity contractsCost of products and other$(17,291)
For the nine months ended September 30, 2018:  
Commodity contractsCost of products and other$(55,877)
For the nine months ended September 30, 2017:  
Commodity contractsCost of products and other$(2,606)
   
Hedged items designated in fair value hedges:  
For the three months ended September 30, 2018:  
Intermediate and refined product inventoryCost of products and other$8,163
For the three months ended September 30, 2017:  
Intermediate and refined product inventoryCost of products and other$29,766
For the nine months ended September 30, 2018:  
Intermediate and refined product inventoryCost of products and other$10,701
For the nine months ended September 30, 2017:  
Intermediate and refined product inventoryCost of products and other$26,659


The Company had no ineffectiveness related to the fair value hedges for the three and ninesix months ended SeptemberJune 30, 20182019 or 2017.2018.


PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


15.16. SEGMENT INFORMATION
The Company’s operations are organized into two reportable segments, Refining and Logistics. Operations that are not included in the Refining and Logistics segments are included in Corporate. Intersegment transactions are eliminated in the consolidated financial statementsCondensed Consolidated Financial Statements and are included in Eliminations.
Refining
The Company’s Refining segment includes the operations of its five refineries, including certain related logistics assets that are not owned by PBFX. The Company’s refineries are located in Delaware City, Delaware, Paulsboro, New Jersey, Toledo, Ohio, New Orleans, Louisiana and Torrance, California. The refineries produce unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants and other petroleum products in the United States. The Company purchases crude oil, other feedstocks and blending components from various third-party suppliers. The Company sells products throughout the Northeast, Midwest, Gulf Coast and West Coast of the United States, as well as in other regions of the United States and Canada, and is able to ship products to other international destinations.
Logistics
The Company’s Logistics segment is comprised of PBFX, a publicly traded master limited partnership,publicly-traded MLP, formed to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets. PBFX’s assets primarily consist of rail and truck terminals and unloading racks, tank farms and pipelines that were acquired from or contributed by PBF LLC and are located at, or nearby, the Company’s refineries. PBFX provides various rail, truck and marine terminaling services, pipeline transportation services and storage services to PBF Holding and/or its subsidiaries and third partythird-party customers through fee-based commercial agreements. PBFX currently does not generate significant third partythird-party revenue and intersegment related-party revenues are eliminated in consolidation. From a PBF Energy and PBF LLC perspective, the Company’s chief operating decision maker evaluates the Logistics segment as a whole without regard to any of PBFX’s individual operating segments.
The Company evaluates the performance of its segments based primarily on income from operations. Income from operations includes those revenues and expenses that are directly attributable to management of the respective segment. The Logistics segment’s revenues include intersegment transactions with the Company’s Refining segment at prices the Company believes are substantially equivalent to the prices that could have been negotiated with unaffiliated parties with respect to similar services. Activities of the Company’s business that are not included in the two operating segments are included in Corporate. Such activities consist primarily of corporate staff operations and other items that are not specific to the normal operations of the two operating segments. The Company does not allocate non-operating income and expense items, including income taxes, to the individual segments. The Refinery segment’s operating subsidiaries and PBFX are primarily pass-through entities with respect to income taxes.
Total assets of each segment consist of property, plant and equipment, inventories, cash and cash equivalents, accounts receivables and other assets directly associated with the segment’s operations. Corporate assets consist primarily of deferred tax assets, property, plant and equipment and other assets not directly related to the Company’s refinery and logisticlogistics operations.
Disclosures regarding the Company’s reportable segments with reconciliations to consolidated totals for the three and ninesix months ended SeptemberJune 30, 20182019 and SeptemberJune 30, 20172018 are presented below. In connection with the adoption of ASU 2017-07,certain contributions by PBF LLC to PBFX in 2018, the accompanying segment information has been retrospectively adjusted to include the historical results of those assets in the Logistics segment for all periods presented prior to reflect the reclassification of certain net periodic benefit costs from Operating expenses and General and administrative expenses to Other income (expense).such contributions.


PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)




PBF EnergyThree Months Ended September 30, 2018
Refining Logistics Corporate Eliminations Consolidated TotalThree Months Ended June 30, 2019
PBF Energy - (in millions)
Refining Logistics Corporate Eliminations Consolidated Total
Revenues$7,641,944
 $70,556
 $—
 $(66,140) $7,646,360
$6,551.9
 $82.8
 $—
 $(74.7) $6,560.0
Depreciation and amortization expense83,281
 7,451
 2,594
 —
 93,326
95.3
 8.9
 2.9
 —
 107.1
Income (loss) from operations (1)321,370
 37,577
 (67,789) (4,725) 286,433
Income (loss) from operations (1) (2)23.7
 37.8
 (48.8) (3.2) 9.5
Interest expense, net2,078
 10,567
 29,644
 —
 42,289
0.9
 12.5
 28.7
 —
 42.1
Capital expenditures79,697
 20,956
 2,233
 —
 102,886
235.9
 4.0
 1.4
 —
 241.3


Three Months Ended September 30, 2017Three Months Ended June 30, 2018
Refining Logistics Corporate Eliminations Consolidated TotalRefining Logistics Corporate Eliminations Consolidated Total
Revenues$5,475,114
 $66,195
 $—
 $(62,358) $5,478,951
$7,439.6
 $68.1
 $—
 $(63.6) $7,444.1
Depreciation and amortization expense70,192
 5,756
 2,572
 —
 78,520
82.6
 7.1
 2.6
 —
 92.3
Income (loss) from operations (1)(2)609,292
 39,201
 (57,434) (3,799) 587,260
447.6
 33.8
 (54.7) (4.4) 422.3
Interest expense, net1,180
 7,748
 28,062
 —
 36,990
2.5
 10.5
 30.4
 —
 43.4
Capital expenditures(3)165,179
 15,536
 562
 —
 181,277
208.7
 61.7
 1.5
 —
 271.9


Nine Months Ended September 30, 2018Six Months Ended June 30, 2019
Refining Logistics Corporate Eliminations Consolidated TotalRefining Logistics Corporate Eliminations Consolidated Total
Revenues$20,880,613
 $203,395
 $—
 $(190,789) $20,893,219
$11,760.6
 $161.6
 $—
 $(146.0) $11,776.2
Depreciation and amortization expense242,568
 21,185
 7,871
 —
 271,624
189.6
 17.6
 5.7
 —
 212.9
Income (loss) from operations (1)895,952
 105,299
 (183,785) (13,110) 804,356
Income (loss) from operations (1) (2)413.2
 72.0
 (103.2) (7.9) 374.1
Interest expense, net6,509
 30,940
 91,486
 —
 128,935
1.4
 24.6
 55.6
 —
 81.6
Capital expenditures (2)376,774
 86,627
 4,726
 —
 468,127
483.0
 15.2
 3.7
 —
 501.9


Nine Months Ended September 30, 2017Six Months Ended June 30, 2018
Refining Logistics Corporate  Eliminations Consolidated TotalRefining Logistics Corporate  Eliminations Consolidated Total
Revenues$15,237,189
 $190,375
 $—
 $(176,915) $15,250,649
$13,238.7
 $132.8
 $—
 $(124.6) $13,246.9
Depreciation and amortization expense180,704
 17,096
 10,355
 —
 208,155
159.3
 13.7
 5.3
 —
 178.3
Income (loss) from operations (1)(2)521,015
 107,765
 (140,555) (11,218) 477,007
574.6
 67.7
 (115.9) (8.4) 518.0
Interest expense, net3,433
 23,618
 87,820
 —
 114,871
4.4
 20.4
 61.8
 —
 86.6
Capital expenditures (2)(3)574,871
 72,100
 2,971
 —
 649,942
297.0
 65.7
 2.5
 —
 365.2


 Balance at September 30, 2018
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (3)$8,369,215
 $806,850
 $72,799
 $(33,454) $9,215,410
 Balance at December 31, 2017
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (3)$7,287,384
 $748,215
 $123,211
 $(40,817) $8,117,993

 Balance at June 30, 2019
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (1)$7,834.5
 $959.6
 $62.9
 $(47.3) $8,809.7


 Balance at December 31, 2018
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (4)$6,988.0
 $956.4
 $98.1
 $(37.1) $8,005.4




PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)



PBF LLCThree Months Ended September 30, 2018
Refining Logistics Corporate Eliminations Consolidated TotalThree Months Ended June 30, 2019
PBF LLC - (in millions)
Refining Logistics Corporate Eliminations Consolidated Total
Revenues$7,641,944
 $70,556
 $—
 $(66,140) $7,646,360
$6,551.9
 $82.8
 $—
 $(74.7) $6,560.0
Depreciation and amortization expense83,281
 7,451
 2,594
 —
 93,326
95.3
 8.9
 2.9
 —
 107.1
Income (loss) from operations (1)321,370
 37,577
 (67,463) (4,725) 286,759
Income (loss) from operations (1) (2)23.7
 37.8
 (48.4) (3.2) 9.9
Interest expense, net2,078
 10,567
 31,828
 —
 44,473
0.9
 12.5
 31.1
 —
 44.5
Capital expenditures79,697
 20,956
 2,233
 —
 102,886
235.9
 4.0
 1.4
 —
 241.3


Three Months Ended September 30, 2017Three Months Ended June 30, 2018
Refining Logistics Corporate Eliminations Consolidated TotalRefining Logistics Corporate Eliminations Consolidated Total
Revenues$5,475,114
 $66,195
 $—
 $(62,358) $5,478,951
$7,439.6
 $68.1
 $—
 $(63.6) $7,444.1
Depreciation and amortization expense70,192
 5,756
 2,572
 —
 78,520
82.6
 7.1
 2.6
 —
 92.3
Income (loss) from operations (1)(2)609,292
 39,201
 (57,386) (3,799) 587,308
447.6
 33.8
 (54.2) (4.4) 422.8
Interest expense, net1,180
 7,748
 29,965
 —
 38,893
2.5
 10.5
 32.4
 —
 45.4
Capital expenditures(3)165,179
 15,536
 562
 —
 181,277
208.7
 61.7
 1.5
 —
 271.9

Nine Months Ended September 30, 2018Six Months Ended June 30, 2019
Refining Logistics Corporate Eliminations Consolidated TotalRefining Logistics Corporate Eliminations Consolidated Total
Revenues$20,880,613
 $203,395
 $—
 $(190,789) $20,893,219
$11,760.6
 $161.6
 $—
 $(146.0) $11,776.2
Depreciation and amortization expense242,568
 21,185
 7,871
 —
 271,624
189.6
 17.6
 5.7
 —
 212.9
Income (loss) from operations (1)895,952
 105,299
 (182,766) (13,110) 805,375
Income (loss) from operations (1) (2)413.2
 72.0
 (102.5) (7.9) 374.8
Interest expense, net6,509
 30,940
 97,667
 —
 135,116
1.4
 24.6
 60.0
 —
 86.0
Capital expenditures (2)376,774
 86,627
 4,726
 —
 468,127
483.0
 15.2
 3.7
 —
 501.9

Nine Months Ended September 30, 2017Six Months Ended June 30, 2018
Refining Logistics Corporate  Eliminations Consolidated TotalRefining Logistics Corporate  Eliminations Consolidated Total
Revenues$15,237,189
 $190,375
 $—
 $(176,915)��$15,250,649
$13,238.7
 $132.8
 $—
 $(124.6) $13,246.9
Depreciation and amortization expense180,704
 17,096
 10,355
 —
 208,155
159.3
 13.7
 5.3
 —
 178.3
Income (loss) from operations (1)(2)521,015
 107,765
 (140,399) (11,218) 477,163
574.6
 67.7
 (115.2) (8.4) 518.7
Interest expense, net3,433
 23,618
 93,859
 —
 120,910
4.4
 20.4
 65.8
 —
 90.6
Capital expenditures (2)(3)574,871
 72,100
 2,971
 —
 649,942
297.0
 65.7
 2.5
 —
 365.2

 Balance at September 30, 2018
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (3)$8,369,215
 $806,850
 $66,234
 $(33,454) $9,208,845
 Balance at June 30, 2019
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (1)$7,834.5
 $959.6
 $60.4
 $(47.3) $8,807.2

 Balance at December 31, 2017
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (3)$7,287,384
 $748,215
 $44,203
 $(40,817) $8,038,985
 Balance at December 31, 2018
 Refining Logistics Corporate  Eliminations Consolidated Total
Total assets (4)$6,988.0
 $956.4
 $45.8
 $(37.1) $7,953.1


PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


(1)TheOn April 24, 2019, PBFX entered into the TVPC Contribution Agreement, pursuant to which PBF LLC contributed to PBFX all of the issued and outstanding limited liability company interests of TVP Holding. Prior to the TVPC Acquisition, TVP Holding owned a 50% membership interest in TVPC. Subsequent to the closing of the TVPC Acquisition on May 31, 2019, PBFX owns 100% of the membership interests in TVPC.
(2)Prior to the TVPC Contribution Agreement, the Logistics segment includesincluded 100% of the income from operations of TVPC, as TVPC iswas consolidated by PBFX. PBFX recordsrecorded net income attributable to noncontrolling interest for the 50% equity interest in TVPC held by PBF Holding. PBF Holding (included in the Refining segment) recordsrecorded equity income in investee related to its 50% noncontrolling ownership interest in TVPC. For purposes of the Company’s condensed consolidated financial statements,Condensed Consolidated Financial Statements, PBF Holding’s equity income in investee and PBFX’s net income attributable to noncontrolling interest eliminateeliminated in consolidation.
PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)

(2)(3)The Logistics segment includes capital expenditures of $58,000$58.0 million for the acquisition of the Knoxville Terminals by PBFX on April 16, 2018 and $10,097 for the acquisition of the Toledo Products Terminal by PBFX on April 17, 2017.2018.
(3)(4)ThePrior to the TVPC Contribution Agreement, the Logistics segment includesincluded 100% of the assets of TVPC, as TVPC iswas consolidated by PBFX. PBFX records arecorded noncontrolling interest for the 50% equity interest in TVPC held by PBF Holding. PBF Holding (included in the Refining segment) recordsrecorded an equity investment in TVPC reflecting its noncontrolling ownership interest. For purposes of the Company’s condensed consolidated PBF Energy and PBF LLC financial statements,Condensed Consolidated Financial Statements, PBFX’s noncontrolling interest in TVPC and PBF Holding’s equity investment in TVPC eliminateeliminated in consolidation.


PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


16.17. NET INCOME PER SHARE OF PBF ENERGY
The Company grants certain equity-based compensation awards to employees and non-employee directors that are considered to be participating securities. Due to the presence of participating securities, the Company has calculated net income per share of PBF Energy Class A common stock using the two-class method.
The following table sets forth the computation of basic and diluted net income (loss) per share of PBF Energy Class A common stock attributable to PBF Energy:Energy for the periods presented:
Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
(in millions, except share and per share amounts)Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
Basic Earnings Per Share:2018 2017 2018 20172019 2018 2019 2018
Allocation of earnings:              
Net income attributable to PBF Energy Inc. stockholders$179,538
 $314,365
 $482,057
 $173,625
Net income (loss) attributable to PBF Energy Inc. stockholders$(32.2) $272.1
 $197.0
 $302.5
Less: Income allocated to participating securities194
 272
 592
 811
0.1
 0.2
 0.2
 0.4
Income available to PBF Energy Inc. stockholders - basic$179,344
 $314,093
 $481,465
 $172,814
Denominator for basic net income per Class A common share - weighted average shares117,029,486
 109,724,595
 113,597,970
 109,634,921
Basic net income attributable to PBF Energy per Class A common share$1.53
 $2.86
 $4.24
 $1.58
Income (loss) available to PBF Energy Inc. stockholders - basic$(32.3) $271.9
 $196.8
 $302.1
Denominator for basic net income (loss) per Class A common share - weighted average shares119,181,845
 112,875,813
 119,885,386
 111,853,774
Basic net income (loss) attributable to PBF Energy per Class A common share$(0.27) $2.41
 $1.64
 $2.70
              
Diluted Earnings Per Share:              
Numerator:              
Income available to PBF Energy Inc. stockholders - basic$179,344
 $314,093
 $481,465
 $172,814
Income (loss) available to PBF Energy Inc. stockholders - basic$(32.3) $271.9
 $196.8
 $302.1
Plus: Net income attributable to noncontrolling interest (1)
2,394
 18,137
 9,790
 9,677
—
 6.1
 2.7
 7.4
Less: Income tax expense on net income attributable to noncontrolling interest (1)
(632) (7,139) (2,585) (3,809)—
 (1.5) (0.7) (1.9)
Numerator for diluted net income per Class A common share - net income attributable to PBF Energy Inc. stockholders (1)
$181,106
 $325,091
 $488,670
 $178,682
Numerator for diluted net income (loss) per PBF Energy Class A common share - net income (loss) attributable to PBF Energy Inc. stockholders (1)
$(32.3) $276.5
 $198.8
 $307.6
              
Denominator:(1)
              
Denominator for basic net income per Class A common share-weighted average shares117,029,486
 109,724,595
 113,597,970
 109,634,921
Denominator for basic net income (loss) per PBF Energy Class A common share-weighted average shares119,181,845
 112,875,813
 119,885,386
 111,853,774
Effect of dilutive securities:(2)              
Conversion of PBF LLC Series A Units1,206,326
 3,825,508
 2,184,690
 3,832,464
—
 1,838,196
 1,206,325
 2,681,980
Common stock equivalents (2)
2,169,503
 332,137
 1,592,510
 324,157
—
 1,695,264
 928,733
 1,214,173
Denominator for diluted net income per Class A common share-adjusted weighted average shares120,405,315
 113,882,240
 117,375,170
 113,791,542
Diluted net income attributable to PBF Energy Inc. stockholders per Class A common share$1.50
 $2.85
 $4.16
 $1.57
__________       
Denominator for diluted net income (loss) per PBF Energy Class A common share-adjusted weighted average shares119,181,845
 116,409,273
 122,020,444
 115,749,927
Diluted net income (loss) attributable to PBF Energy Inc. stockholders per PBF Energy Class A common share$(0.27) $2.37
 $1.63
 $2.66
       

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


(1)The diluted earnings per share calculation generally assumes the conversion of all outstanding PBF LLC Series A Units to PBF Energy Class A common stock of PBF Energy.stock. The net income (loss) attributable to PBF Energy, used in the numerator of the diluted earnings per share calculation is adjusted to reflect the net income (loss), as well as the corresponding income tax expensebenefit (expense) (based on a 26.5% estimated annualized statutory corporate tax rate for the three and six months ended June 30, 2019 and a 26.4% estimated annualized statutory corporate tax rate for both the three and ninesix months ended SeptemberJune 30, 2018 and 39.4% estimated annualized statutory corporate tax rate for both the three and nine months ended September 30, 2017)2018) attributable to the converted units. During the three months ended June 30, 2019, the potential conversion of 1,206,325 PBF LLC Series A Units into PBF Energy Class A common stock were excluded from the denominator in computing diluted net income (loss) per share because including them would have had an anti-dilutive effect. As the potential conversion of the PBF LLC Series A Units and common stock equivalents were not included, the numerator used in the calculation of diluted net income (loss) per share was equal to the numerator used in the calculation of basic net income (loss) per share and does not include the net income (loss) and income tax attributable to the net income (loss) associated with the potential conversion of the PBF LLC Series A Units and common stock equivalents.

PBF ENERGY INC. AND PBF ENERGY COMPANY LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT SHARE, UNIT, PER SHARE, PER UNIT AND BARREL DATA)


(2)Represents an adjustment to weighted-average diluted shares outstanding to assume the full exchange of common stock equivalents, including options and warrants for PBF LLC Series A Units and performance share units and options for shares of PBF Energy Class A common stock as calculated under the treasury stock method (to the extent the impact of such exchange would not be anti-dilutive). Common stock equivalents exclude the effects of options, warrants and warrantsperformance share units to purchase 15,0006,833,973 and 25,0006,012,867 shares of PBF Energy Class A common stock and PBF LLC Series A units because they are anti-dilutive for the three and ninesix months ended SeptemberJune 30, 2018,2019, respectively. Common stock equivalents exclude the effects of options and warrants to purchase 6,484,65012,500 and 6,554,650233,250 shares of PBF Energy Class A common stock and PBF LLC Series A units because they arewere anti-dilutive for the three and ninesix months ended SeptemberJune 30, 2017,2018, respectively. For periods showing a net loss, all common stock equivalents and unvested restricted stock are considered anti-dilutive.



17.18. SUBSEQUENT EVENTS
Dividend Declared
On October 31, 2018,August 1, 2019, PBF Energy announced a dividend of $0.30 per share on outstanding PBF Energy Class A common stock. The dividend is payable on NovemberAugust 30, 20182019 to PBF Energy Class A common stockholders of record at the close of business on NovemberAugust 15, 2018.2019.
PBFX Distributions
On October 31, 2018,August 1, 2019, the Board of Directors of PBF GP announced a distribution of $0.50$0.515 per unit on outstanding common units of PBFX. The distribution is payable on NovemberAugust 30, 20182019 to PBFX unitholders of record at the close of business on NovemberAugust 15, 2018.2019.
East Coast Storage Assets Acquisition


On July 16, 2018, PBFX entered into an agreement with Crown Point International, LLC, formerly known as Axeon Specialty Products LLC, to purchase its wholly-owned subsidiary, CPI Operations LLC (the “East Coast Storage Assets Acquisition”) for total consideration of $107,000, comprised of an initial payment at closing of $75,000 with the balance being payable one year after closing. The East Coast Storage Assets Acquisition closed on October 1, 2018.







ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the audited financial statements of PBF Energy Inc. and PBF LLC included in the Annual Report on Form 10-K for the year ended December 31, 2017, the audited PBF LLC financial statements for the year ended December 31, 2017 included in the Registration Statement on Form S-4 filed on March 13, 2018 by PBF Logistics LP and the unaudited financial statements and related notes included in this report.2018. The following discussion contains “forward-looking statements” that reflect our future plans, estimates, beliefs and expected performance. Our actual results may differ materially from those currently anticipated and expressed in such forward-looking statements as a result of a number of factors. We caution that assumptions, expectations, projections, intentions or beliefs about future events may, and often do, vary from actual results and the differences can be material. Please see “Cautionary Note Regarding Forward-Looking Statements.”
 
PBF Energy is the sole managing member of, and owner of an equity interest representing approximately 99.0% of the outstanding economic interests in PBF LLC as of SeptemberJune 30, 2018.2019. PBF LLC is a holding company for the companies that directly and indirectly own and operate our business. PBF Holding Company LLC (“PBF Holding”) is a wholly-owned subsidiary of PBF LLC and PBF Finance Corporation (“PBF Finance”) is a wholly-owned subsidiary of PBF Holding. As of SeptemberJune 30, 2018,2019, PBF LLC also holds a 44.0%48.2% limited partner interest and a non-economic general partner interest and all of the incentive distribution rights in PBF Logistics LP (“PBFX” or the “Partnership”), a publicly tradedpublicly-traded master limited partnership.partnership (“MLP”).


Unless the context indicates otherwise, the terms “we,” “us,” and “our” refer to PBF Energy and its consolidated subsidiaries, including PBF LLC, PBF Holding and its subsidiaries and PBFX and its subsidiaries. Discussions oron areas that either apply only to PBF Energy or PBF LLC are clearly noted in such sections.



Overview
We are one of the largest independent petroleum refiners and suppliers of unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants and other petroleum products in the United States. We sell our products throughout the Northeast, Midwest, Gulf Coast and West Coast of the United States, as well as in other regions of the United States, Canada and Mexico and are able to ship products to other international destinations. As of SeptemberJune 30, 2018,2019, we own and operate five domestic oil refineries and related assets with a combined processing capacity, known as throughput, of approximately 900,000 barrels per day (“bpd”), and a weighted-average Nelson Complexity Index of 12.2. We operate in two reportable business segments: Refining and Logistics. Our five oil refineries are all engaged in the refining of crude oil and other feedstocks into petroleum products, and are aggregated into the Refining segment. PBFX operates certain logisticallogistics assets such as crude oil and refined petroleum products terminals, pipelines, and storage facilities, which are aggregated into the Logistics segment.
Our five refineries are located in Delaware City, Delaware, Paulsboro, New Jersey, Toledo, Ohio, New Orleans, Louisiana and Torrance, California. Each of these refineriesrefinery is briefly described in the table below:
RefineryRegionNelson Complexity IndexThroughput Capacity (in barrels per day)PADD
Crude Processed (1)
Source (1)
Delaware CityEast Coast11.3190,0001light sweet through heavy sourwater, rail
PaulsboroEast Coast13.2180,0001light sweet through heavy sourwater
ToledoMid-Continent9.2170,0002light sweetpipeline, truck, rail
ChalmetteGulf Coast12.7189,0003light sweet through heavy sourwater, pipeline
TorranceWest Coast14.9155,0005medium and heavypipeline, water, truck

________
(1) Reflects the typical crude and feedstocks and related sources utilized under normal operating conditions and prevailing market environments.
As of SeptemberJune 30, 2018,2019, PBF Energy owned 119,972,950119,915,672 PBF LLC Series C Units and our current and former executive officers and directors and certain employees and others held 1,206,325 PBF LLC Series A Units (we refer to all of the holders of the PBF LLC Series A Units as “the members of PBF LLC other than PBF Energy”). As a result, the holders of our issued and outstanding shares of our PBF Energy Class A common stock have approximately 99.0% of the voting power in us, and the members of PBF LLC other than PBF Energy through their holdings of Class B common stock have approximately 1.0% of the voting power in us (96.7%(99.0% and 3.3%1.0% as of December 31, 2017,2018, respectively).

Business Developments
Recent significant business developments affecting us are discussed below.
Pending Martinez Acquisition
On June 11, 2019 (the “Execution Date”), PBF Holding entered into a definitive Sale and Purchase Agreement (the “Sale and Purchase Agreement”) with Equilon Enterprises LLC d/b/a Shell Oil Products US (the "Seller"), to purchase the Martinez refinery and related logistics assets (collectively, the “Martinez Acquisition”). The obligations of PBF Holding under the Sale and Purchase Agreement have been guaranteed by the Company. The Martinez refinery is located on an 860-acre site in the City of Martinez, 30 miles northeast of San Francisco, California. The refinery is a high-conversion 157,000 bpd, dual-coking facility with a Nelson Complexity Index of 16.1, making it one of the most complex refineries in the United States. The facility is strategically positioned in Northern California and provides for operating and commercial synergies with the Torrance refinery located in Southern California. The Martinez Acquisition is expected to further increase our total throughput capacity to over 1,000,000 bpd.
In addition to refining assets, the Martinez Acquisition includes a number of high-quality onsite logistics assets including a deep-water marine facility, product distribution terminals and refinery crude and product storage facilities with approximately 8.8 million barrels of shell capacity.
The purchase price for the Martinez Acquisition will range from $900.0 million to $1.0 billion in cash, based on the date the transaction closes, plus inventory and working capital to be valued at closing. In addition, PBF Holding also has an obligation to make certain post-closing payments to the Seller if certain conditions are met including earn-out payments based on certain earnings thresholds of the Martinez refinery (as set forth in the Sale and Purchase Agreement), for a period of up to four years following the closing. The purchase price is also subject to other customary purchase price adjustments. The Martinez Acquisition is expected to close in the fourth quarter of 2019, subject to satisfaction of customary closing conditions, including the absence of legal impediments prohibiting the Martinez Acquisition, receipt of regulatory approvals and required consents and absence of a material adverse effect. Additionally, as a condition of closing, the assets must be operational in all material respects and in substantially the same condition and repair, ordinary wear and tear excepted, as of the Execution Date.
We expect to finance the transaction with a combination of cash on hand and debt. Following the expected completion of the Martinez Acquisition, our weighted average Nelson Complexity Index will increase to 12.8.

Factors Affecting Comparability Between Periods
Our results have been affected by the following events, the understanding of which will aid in assessing the comparability of our period to period financial performance and financial condition.
Torrance Land SalePBFX Registered Direct Offering
During the three months ended September 30, 2018, the CompanyOn April 24, 2019, PBFX entered into subscription agreements to sell an aggregate of 6,585,500 common units to certain institutional investors in a registered direct public offering (the “PBFX Registered Direct Offering”) for gross proceeds of approximately $135.0 million. The PBFX Registered Direct Offering closed on a third party sale of a parcel of real property acquired as partApril 29, 2019.
Inventory Intermediation Agreements
On certain dates subsequent to the inception of the Torrance Refinery, but not part ofInventory Intermediation Agreements, we and our subsidiaries, DCR and PRC, entered into amendments to the refinery itself. The sale resulted in a gain of approximately $43.8 million included within Gain on sale of assets within the Condensed Consolidated Statements of Operations.
Early Return of Railcars
On September 30, 2018, we agreed to voluntarily return a portion of railcars under an operating lease in order to rationalize certain components of our railcar fleet based on prevailing market conditionsamended and restated inventory intermediation agreements (as amended in the crude oil by rail market. Underfirst quarter of 2019, the “Inventory Intermediation Agreements”) with J. Aron & Company, a subsidiary of The Goldman Sachs Group, Inc. (“J. Aron”), pursuant to which certain terms of the lease amendment, weinventory intermediation agreements were amended, including, among other things, pricing and an extension of the terms. The most recent of these amendments was executed on March 29, 2019. As a result of the amendments (i) the Inventory Intermediation Agreement by and among J. Aron, PBF Holding and DRC (i) extended the term to February 28, 2020, which term may be further extended by mutual consent of the parties to February 26, 2021 and (ii) added the PBFX East Coast Storage Facility (as defined in “Note 4 - Inventories” of our Notes to Condensed Consolidated Financial Statements) as a location which will pay agreed amountssell crude oil, a new product type to be included in lieuthe Products (as defined in “Note 4 - Inventories” of satisfactionour Notes to Condensed Consolidated Financial Statements), to J. Aron by DCR. Pursuant to each Inventory Intermediation Agreement, J. Aron continues to purchase and hold title to the Products produced by the Paulsboro and Delaware City refineries (the “Refineries”), and delivered into the Storage Tanks (as defined in “Note 4 - Inventories” of return conditions (the “early termination penalty”)our Notes to Condensed Consolidated Financial Statements). Furthermore, J. Aron agrees to sell the Products back to the Refineries as the Products are discharged out of the Storage Tanks. J. Aron has the right to store the Products purchased in tanks under the Inventory Intermediation Agreements and will pay a reduced rental fee overretain these storage rights for the remaining term of the lease. Certainagreements. PBF Holding continues to market and sell the Products independently to third parties.
PBFX IDR Restructuring
On February 28, 2019, PBFX closed on an Equity Restructuring Agreement (the “IDR Restructuring Agreement”) with PBF LLC and PBF GP, pursuant to which PBFX’s incentive distribution rights (the “IDRs”) held by PBF LLC were canceled and converted into 10,000,000 newly issued PBFX common units (the “IDR Restructuring”). Subsequent to the closing of these railcars are idlethe IDR Restructuring, no distributions were made to PBF LLC with respect to the IDRs and the remaining railcars will be taken outnewly issued PBFX common units are entitled to normal distributions by PBFX.
Adoption of service duringAccounting Standards Codification (“ASC”) Topic 842, “Leases”
As disclosed in “Note 8 - Leases” of our Notes to Condensed Consolidated Financial Statements, prior to January 1, 2019, we accounted for leases under ASC 840 and did not record a right of use asset or corresponding lease liability for operating leases on our Condensed Consolidated Balance Sheets. We adopted ASC 842 using a modified retrospective approach, and elected the fourth quartertransition method to apply the new standard at the adoption date of 2018January 1, 2019. As such, financial information for prior periods has not been adjusted and subsequently fully returned to the lessor. As a result, we recognized an expense of $44.6 million for the three months ended September 30, 2018 included within Cost of sales consisting of (i) a $40.3 million charge for the early termination penalty and (ii) a $4.3 million charge related to the remaining lease payments associated with the portion of railcars within the amended lease, that were idled and out of service as of September 30, 2018. In addition, we expect to recognize a charge of $7.7 million subsequent to September 30, 2018 relating to the residual lease payments as the remaining railcars are taken out of service and returned to the lessor. We have recorded a liability within Accrued expenses for $25.8 million representing the amount of the early lease termination obligation expectedcontinues to be paid within the next twelve months and a liability within Other long-term liabilities for $18.7 million representing the remaining amountreported under ASC 840. Refer to “Note 8 - Leases” of the obligation.our Notes to Condensed Consolidated Financial Statements.
PBF Energy Inc. Public Offering
On August 14, 2018, wePBF Energy completed a public offering of an aggregate of 6,000,000 shares of Class A common stock (the “August 2018 Equity Offering”) for net proceeds of $287.3 million, after deducting underwriting discounts and commissions and other offering expenses. Netexpenses (the “August 2018 Equity Offering”).

PBFX Assets and Transactions
PBFX’s assets consist of various logistics assets. Apart from business associated with certain third-party acquisitions, PBFX’s revenue is derived from long-term, fee-based commercial agreements with subsidiaries of PBF Holding, which include minimum volume commitments, for receiving, handling, transferring and storing crude oil, refined products and natural gas. These transactions are eliminated by PBF Energy and PBF LLC in consolidation.
Since the inception of PBFX in 2014, PBF LLC and PBFX have entered into a series of drop-down transactions. Such transactions and third-party acquisitions made by PBFX in the current or prior period are discussed below.
TVPC Acquisition
On April 24, 2019, PBFX entered into a contribution agreement with PBF LLC (the “TVPC Contribution Agreement”), pursuant to which PBF LLC contributed to PBFX all of the issued and outstanding limited liability company interests of TVP Holding Company LLC (“TVP Holding”) for total consideration of $200.0 million (the “TVPC Acquisition”). Prior to the TVPC Acquisition, TVP Holding owned a 50% membership interest in the Torrance Valley Pipeline Company LLC (“TVPC”). Subsequent to the closing of the TVPC Acquisition on May 31, 2019, PBFX owns 100% of the membership interests in TVPC. The transaction was financed through a combination of proceeds from the AugustPBFX Registered Direct Offering and borrowings under the PBFX Revolving Credit Facility (as defined below).
East Coast Storage Assets Acquisition
On July 16, 2018, Equity Offering were subsequently usedPBFX entered into an agreement with Crown Point to purchase its wholly-owned subsidiary, CPI Operations LLC (“CPI”) for total consideration of approximately $127.0 million, including working capital and the Contingent Consideration, comprised of an equivalent amountinitial payment at closing of $75.0 million with a remaining $32.0 million balance payable one year after closing. The residual purchase consideration consists of the Contingent Consideration. The consideration was financed through a combination of cash on hand and borrowings under the PBFX Revolving Credit Facility (as defined below). The East Coast Storage Assets Acquisition (all terms as defined in “Note 3 - Acquisitions” of our Notes to Condensed Consolidated Financial Statements) closed on October 1, 2018.
Development Assets Acquisition
On July 16, 2018, PBFX entered into four contribution agreements with PBF LLC Series C Units.(the “Development Assets Contribution Agreements”), pursuant to which PBFX acquired from PBF LLC all of the issued and outstanding limited liability company interests of: Toledo Rail Logistics Company LLC (“TRLC”), whose assets consist of a loading and unloading rail facility located at PBF Holding’s Toledo Refinery (the “Toledo Rail Products Facility”); Chalmette Logistics Company LLC (“CLC”), whose assets consist of a truck loading rack facility (the “Chalmette Truck Rack”) and a rail yard facility (the “Chalmette Rosin Yard”), both of which are located at PBF Holding’s Chalmette Refinery; Paulsboro Terminaling Company LLC (“PTC”), whose assets consist of a lube oil terminal facility located at PBF Holding’s Paulsboro Refinery (the “Paulsboro Lube Oil Terminal”); and DCR Storage and Loading Company LLC (“DSLC”), whose assets consist of an ethanol storage facility located at PBF Holding’s Delaware City Refinery (the “Delaware Ethanol Storage Facility” and collectively with the Toledo Rail Products Facility, the Chalmette Truck Rack, the Chalmette Rosin Yard, and the Paulsboro Lube Oil Terminal, the “Development Assets”). The acquisition of the Development Assets closed on July 31, 2018 for total consideration of $31.6 million consisting of 1,494,134 common units representing limited partner interests in PBFX, issued to PBF LLC (the “Development Assets Acquisition”).

Knoxville Terminal Acquisition
On April 16, 2018, PBFX completed the purchase of Knoxville Terminals from Cummins Terminals, Inc. for total cash consideration of $58.0 million, excluding working capital adjustments (the “Knoxville Terminals Purchase”). The transaction was financed through a combination of cash on hand and borrowings under the PBFX Revolving Credit Facility.
PBFX Revolving Credit Facility
On July 30, 2018, PBFX entered into an amended and restated credit facility (as amended, the “PBFX Revolving Credit Facility”). Among other things, the with Wells Fargo, National Association, as administrative agent, and a syndicate of lenders. The PBFX Revolving Credit Facility increasesamended and restated the May 2014 PBFX Revolving Credit Facility to, among other things, increase the maximum commitment available to PBFX from $360.0 million to $500.0 million and extendsextend the maturity date to July 2023. PBFX has the ability to increase the maximum amount of the PBFX Revolving Credit Facility by an aggregate

amount of up to $250.0 million, to a total facility size of $750.0 million, subject to receiving increased commitments from lenders or other financial institutions and satisfaction of certain conditions. The commitment fees on the unused portion, the interest rate on advances and the fees for letters of credit are consistent with the May 2014 PBFX Revolving Credit Facility. The PBFX Revolving Credit Facility is guaranteed by a limited guaranty of collection from PBF LLC.
The outstanding balance under the PBFX Registered Direct Offering
On July 16,Revolving Credit Facility was $251.0 million and $156.0 million as of June 30, 2019 and December 31, 2018, PBFX entered into a common unit purchase agreement with certain funds managed by Tortoise Capital Advisors, L.L.C. providing for the issuance and sale in a registered direct offering (the “Registered Direct Offering”) of an aggregate of 1,775,750 common units for gross proceeds of approximately $35.0 million. The Registered Direct Offering closed on July 30, 2018.respectively.
PBF Holding Revolving Credit Facility
On May 2, 2018, PBF Holding and certain of its wholly-owned subsidiaries, as borrowers or subsidiary guarantors, replaced our existing asset-based revolving credit agreement dated as of August 15, 2014 (the “August 2014 Revolving Credit Agreement”) with a new asset-based revolving credit agreement (the “2018 Revolving“Revolving Credit Agreement"Facility"). Among other things, the 2018 Revolving Credit AgreementFacility increases the maximum commitment available to PBF Holding from $2.6 billion to $3.4 billion, extends the maturity date to May 2023 and redefines certain components of the Borrowing Base, as defined in the credit agreement governing the Revolving Credit Facility (the “Revolving Credit Agreement”), to make more funding available for working capital and other general corporate purposes. In addition, an accordion feature allows for commitments of up to $3.5 billion. The commitment fees on the unused portion, the interest rate on advances and the fees for letters of credit are consistent with the August 2014 Revolving Credit Agreement.
Senior Notes Offerings
On May 30, 2017, PBF Holding and PBF Finance issued $725.0 million in aggregate principal amount of 7.25% Senior Notes due 2025 (the “2025 Senior Notes”). The Company used the net proceeds of $711.6 million to fund the cash tender offer (the “Tender Offer”) for any and all of itsThere were no outstanding 8.25% senior secured notes due 2020 (the “2020 Senior Secured Notes”), to pay the related redemption price and accrued and unpaid interest for any 2020 Senior Secured Notes that remained outstanding after the completion of the Tender Offer, and for general corporate purposes. Upon the satisfaction and discharge of the 2020 Senior Secured Notes in connection with the closing of the Tender Offer and the redemption, the 7.00% senior notes due 2023 (the “2023 Senior Notes”) became unsecured and certain covenants were modified, as provided for in the indenture governing the 2023 Senior Notes and related documents.
On October 6, 2017, PBFX issued $175.0 million in aggregate principal amount of 6.875% Senior Notes due 2023 (the “new PBFX 2023 Senior Notes” and, together with the initial PBFX 2023 Senior Notes, the “PBFX 2023 Senior Notes”). The new PBFX 2023 Senior Notes were issued at 102% of face value with an effective rate of 6.442% and were issuedborrowings under the indenture governing the initial PBFX 2023 Senior Notes dated on May 12, 2015. PBFX used the net proceeds from the offering of the new PBFX 2023 Senior Notes to repay a portion of the PBFX Revolving Credit Facility and for general capital purposes. The new PBFX 2023 Senior Notes included a registration rights arrangement whereby the Company agreed to file with the SEC and use commercially reasonable efforts to consummate an offer to exchange the new PBFX 2023 Senior Notes for an issueas of registered notes with terms substantially identical to the notes no later than 365 days after the date of the original issuance of the new PBFX 2023 Senior Notes. This registration statement was declared effective on April 2, 2018,June 30, 2019 and the exchange was consummated in May 2018.

Inventory Intermediation Agreements
On May 4, 2017 and September 8, 2017, we and our subsidiaries, DCR and PRC, entered into amendments to the inventory intermediation agreements (as amended, the "Inventory Intermediation Agreements") with J. Aron & Company, a subsidiary of The Goldman Sachs Group, Inc. (“J. Aron”), pursuant to which certain terms of the existing inventory intermediation agreements were amended, including, among other things, pricing and an extension of the terms. As a result of the amendments (i) the Inventory Intermediation Agreement by and among J. Aron, PBF Holding and PRC relating to the Paulsboro refinery extends the term to December 31, 2019, which term may be further extended by mutual consent of the parties to December 31, 2020 and (ii) the Inventory Intermediation Agreement by and among J. Aron, PBF Holding and DCR relating to the Delaware City refinery extends the term to July 1, 2019, which term may be further extended by mutual consent of the parties to July 1, 2020.2018, respectively.
PBFX Assets and Transactions
PBFX is a fee-based, growth-oriented, publicly traded Delaware master limited partnership formed by PBF Energy to own or lease, operate, develop and acquire crude oil and refined petroleum products terminals, pipelines, storage facilities and similar logistics assets. PBFX engages in the receiving, handling, storage and transferring of crude oil, refined products, natural gas and intermediates from sources located throughout the United States and Canada for PBF Energy in support of its refineries, as well as for third party customers. As of September 30, 2018, a substantial majority of PBFX’s revenue is derived from long-term, fee-based commercial agreements with PBF Holding, which include minimum volume commitments, for receiving, handling, storing and transferring crude oil, refined products and natural gas. PBF Energy also has agreements with PBFX that establish fees for certain general and administrative services and operational and maintenance services provided by PBF Holding to PBFX. These transactions, other than those with third parties, are eliminated by PBF Energy and PBF LLC in consolidation.
On February 15, 2017, PBFX entered into a contribution agreement (the “PNGPC Contribution Agreement”) between PBFX and PBF LLC, pursuant to which PBFX’s wholly owned subsidiary PBFX Operating Company LP (“PBFX Op Co”), acquired from PBF LLC all of the issued and outstanding limited liability company interests of Paulsboro Natural Gas Pipeline Company LLC (“PNGPC”). PNGPC owns and operates an existing interstate natural gas pipeline. In August 2017, PBFX completed construction of a new 24" pipeline to replace the existing pipeline and commenced services.
On February 15, 2017, we entered into a ten-year storage services agreement with PBFX Op Co (the “Chalmette Storage Services Agreement”) under which PBFX, through PBFX Op Co, assumed construction of a new crude tank with a shell capacity of 625,000 barrels at PBF Holding’s Chalmette refinery (the “Chalmette Storage Tank”). The Chalmette Storage Tank commenced operations in November 2017 upon completion of construction.
On April 16, 2018, PBFX completed the purchase of two refined product terminals located in Knoxville, Tennessee, which include product tanks, pipeline connections to the Colonial and Plantation pipeline systems and truck loading facilities with nine loading bays (the “Knoxville Terminals”) from Cummins Terminals, Inc. for total cash consideration of $58.0 million, excluding working capital adjustments (the “Knoxville Terminals Purchase”). The transaction was financed through a combination of cash on hand and borrowings under the PBFX Revolving Credit Facility.
On May 2, 2018, the Delaware City Rail Terminaling Services Agreement and the Delaware West Ladder Rack Terminaling Services Agreement between PBF Energy’s subsidiaries, Delaware City Terminaling Company LLC and PBF Holding were amended effective as of January 1, 2018 (collectively, the “Amended and Restated Rail Agreements”) with the service fees thereunder being adjusted, including the addition of an ancillary fee paid by PBF Holding on an actual cost basis. In determining payments due under the Amended and Restated Rail Agreements, excess volumes throughput under the agreements shall apply against required payments in respect to the minimum throughput commitments on a quarterly basis and, to the extent not previously applied, on an annual basis against the minimum volume commitments.


Results of Operations

The tables below reflect our consolidated financial and operating highlights for the three and ninesix months ended SeptemberJune 30, 20182019 and 20172018 (amounts in thousands,millions, except per share data). Differences between the results of operations betweenof PBF Energy and PBF LLC primarily pertain to income tax expense,taxes, interest expense and non-controllingnoncontrolling interest as shown below. Earnings per share information applies only to the financial results of PBF Energy. We operate in two reportable business segments: Refining and Logistics. Our oil refineries, excluding the assets owned by PBFX, are all engaged in the refining of crude oil and other feedstocks into petroleum products, and are aggregated into the Refining segment. PBFX is a publicly traded master limited partnershippublicly-traded MLP that operates certain logisticallogistics assets such as crude oil and refined petroleum products terminals, pipelines and storage facilities. PBFX’s operations are aggregated into the Logistics segment. We do not separately discuss our results by individual segmentsegments as, apart from PBFX’s third-party acquisitions, our Logistics segment doesdid not currently generatehave any significant third partythird-party revenue and a significant portion of its operating results eliminate in consolidation.


PBF EnergyThree Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
2018 2017 2018 20172019 2018 2019 2018
Revenues$7,646,360
 $5,478,951
 $20,893,219
 $15,250,649
$6,560.0
 $7,444.1
 $11,776.2
 $13,246.9
Cost and expenses:              
Cost of products and other6,816,095
 4,352,061
 18,400,732
 13,154,521
5,955.8
 6,452.5
 10,165.0
 11,584.6
Operating expenses (excluding depreciation and amortization expense as reflected below)424,331
 402,823
 1,268,161
 1,266,879
433.2
 417.7
 912.2
 843.8
Depreciation and amortization expense90,732
 75,948
 263,753
 197,800
104.2
 89.7
 207.2
 173.0
Cost of sales7,331,158
 4,830,832
 19,932,646
 14,619,200
6,493.2
 6,959.9
 11,284.4
 12,601.4
General and administrative expenses (excluding depreciation and amortization expense as reflected below)69,920
 58,259
 191,418
 143,147
53.6
 58.7
 111.2
 121.5
Depreciation and amortization expense2,594
 2,572
 7,871
 10,355
2.9
 2.6
 5.7
 5.3
(Gain) loss on sale of assets(43,745) 28
 (43,072) 940
Loss on sale of assets0.8
 0.6
 0.8
 0.7
Total cost and expenses7,359,927
 4,891,691
 20,088,863
 14,773,642
6,550.5
 7,021.8
 11,402.1
 12,728.9
              
Income from operations286,433
 587,260
 804,356
 477,007
9.5
 422.3
 374.1
 518.0
Other income (expense):              
Change in Tax Receivable Agreement liability7,763
 565
 7,763
 565
Change in fair value of catalyst leases1,630
 473
 5,783
 (1,011)0.5
 4.1
 (2.6) 4.1
Debt extinguishment costs—
 —
 —
 (25,451)
Interest expense, net(42,289) (36,990) (128,935) (114,871)(42.1) (43.4) (81.6) (86.6)
Other non-service components of net periodic benefit cost278
 (103) 833
 (305)—
 0.2
 (0.1) 0.5
Income before income taxes253,815
 551,205
 689,800
 335,934
Income tax expense61,349
 203,979
 167,836
 112,889
Net income192,466
 347,226
 521,964
 223,045
Income (loss) before income taxes(32.1) 383.2
 289.8
 436.0
Income tax (benefit) expense(10.5) 95.5
 70.0
 106.5
Net income (loss)(21.6) 287.7
 219.8
 329.5
Less: net income attributable to noncontrolling interests12,928
 32,861
 39,907
 49,420
10.6
 15.6
 22.8
 27.0
Net income attributable to PBF Energy Inc. stockholders$179,538
 $314,365
 $482,057
 $173,625
Net income (loss) attributable to PBF Energy Inc. stockholders$(32.2) $272.1
 $197.0
 $302.5
              
Consolidated gross margin$315,202
 $648,119
 $960,573
 $631,449
$66.8
 $484.2
 $491.8
 $645.5
              
Gross refining margin (1)
$765,773
 $1,064,007
 $2,304,085
 $1,912,869
$526.5
 $928.3
 $1,459.0
 $1,538.3
              
Net income available to Class A common stock per share:       
Net income (loss) available to Class A common stock per share:       
Basic$1.53
 $2.86
 $4.24
 $1.58
$(0.27) $2.41
 $1.64
 $2.70
Diluted$1.50
 $2.85
 $4.16
 $1.57
$(0.27) $2.37
 $1.63
 $2.66
(1) See Non-GAAP Financial Measures.



PBF LLCThree Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
2018 2017 2018 20172019 2018 2019 2018
Revenues$7,646,360
 $5,478,951
 $20,893,219
 $15,250,649
$6,560.0
 $7,444.1
 $11,776.2
 $13,246.9
Cost and expenses:              
Cost of products and other6,816,095
 4,352,061
 18,400,732
 13,154,521
5,955.8
 6,452.5
 10,165.0
 11,584.6
Operating expenses (excluding depreciation and amortization expense as reflected below)424,331
 402,823
 1,268,161
 1,266,879
433.2
 417.7
 912.2
 843.8
Depreciation and amortization expense90,732
 75,948
 263,753
 197,800
104.2
 89.7
 207.2
 173.0
Cost of sales7,331,158
 4,830,832
 19,932,646
 14,619,200
6,493.2
 6,959.9
 11,284.4
 12,601.4
General and administrative expenses (excluding depreciation and amortization expense as reflected below)69,594
 58,211
 190,399
 142,991
53.2
 58.2
 110.5
 120.8
Depreciation and amortization expense2,594
 2,572
 7,871
 10,355
2.9
 2.6
 5.7
 5.3
(Gain) loss on sale of assets(43,745) 28
 (43,072) 940
Loss on sale of assets0.8
 0.6
 0.8
 0.7
Total cost and expenses7,359,601
 4,891,643
 20,087,844
 14,773,486
6,550.1
 7,021.3
 11,401.4
 12,728.2
              
Income from operations286,759
 587,308
 805,375
 477,163
9.9
 422.8
 374.8
 518.7
              
Other income (expense):              
Change in fair value of catalyst leases1,630
 473
 5,783
 (1,011)0.5
 4.1
 (2.6) 4.1
Debt extinguishment costs—
 —
 —
 (25,451)
Interest expense, net(44,473) (38,893) (135,116) (120,910)(44.5) (45.4) (86.0) (90.6)
Other non-service components of net periodic benefit cost278
 (103) 833
 (305)—
 0.2
 (0.1) 0.5
Income before income taxes244,194
 548,785
 676,875
 329,486
Income tax (benefit) expense(719) (4,292) (5,403) 2,040
Net income244,913
 553,077
 682,278
 327,446
Income (loss) before income taxes(34.1) 381.7
 286.1
 432.7
Income tax expense (benefit)1.8
 (4.0) (5.4) (4.7)
Net income (loss)(35.9) 385.7
 291.5
 437.4
Less: net income attributable to noncontrolling interests10,534
 14,732
 30,117
 39,751
11.1
 9.4
 20.1
 19.6
Net income attributable to PBF Energy Company LLC$234,379
 $538,345
 $652,161
 $287,695
Net income (loss) attributable to PBF Energy Company LLC$(47.0) $376.3
 $271.4
 $417.8





Operating HighlightsThree Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
2018 2017 2018 20172019 2018 2019 2018
Key Operating Information              
Production (bpd in thousands)896.7
 852.6
 854.0
 781.6
854.2
 866.1
 796.7
 831.2
Crude oil and feedstocks throughput (bpd in thousands)888.4
 849.7
 851.8
 786.1
854.1
 866.6
 798.9
 833.3
Total crude oil and feedstocks throughput (millions of barrels)81.7
 78.2
 232.5
 214.6
77.7
 78.8
 144.6
 150.8
Consolidated gross margin per barrel of throughput$3.86
 $8.29
 $4.13
 $2.94
$0.85
 $6.14
 $3.40
 $4.28
Gross refining margin, excluding special items, per barrel of throughput (1)
$9.25
 $10.22
 $8.80
 $8.46
$9.10
 $9.77
 $7.85
 $8.57
Refinery operating expense, per barrel of throughput$5.01
 $4.98
 $5.26
 $5.71
$5.27
 $5.11
 $5.97
 $5.40
              
Crude and feedstocks (% of total throughput) (2)
              
Heavy35% 33% 36% 34%30% 38% 31% 37%
Medium28% 30% 30% 30%28% 28% 30% 31%
Light23% 22% 21% 21%26% 21% 25% 20%
Other feedstocks and blends14% 15% 13% 15%16% 13% 14% 12%
Total throughput100% 100% 100% 100%100% 100% 100% 100%
              
Yield (% of total throughput)              
Gasoline and gasoline blendstocks49% 50% 49% 50%49% 48% 48% 49%
Distillates and distillate blendstocks32% 29% 32% 29%31% 32% 32% 32%
Lubes1% 1% 1% 1%1% 1% 1% 1%
Chemicals2% 2% 2% 2%2% 2% 2% 2%
Other17% 18% 16% 17%17% 17% 17% 16%
Total yield101% 100% 100% 99%100% 100% 100% 100%




(1)See Non-GAAP Financial Measures.
(2)We define heavy crude oil as crude oil with American Petroleum Institute (API) gravity less than 24 degrees. We define medium crude oil as crude oil with API gravity between 24 and 35 degrees. We define light crude oil as crude oil with API gravity higher than 35 degrees.


The table below summarizes certain market indicators relating to our operating results as reported by Platts.
Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
2018 2017 2018 20172019 2018 2019 2018
(dollars per barrel, except as noted)(dollars per barrel, except as noted)
Dated Brent Crude$75.07
 $52.16
 $72.19
 $51.79
Dated Brent crude oil$68.96
 $74.42
 $66.16
 $70.75
West Texas Intermediate (WTI) crude oil$69.63
 $48.18
 $66.90
 $49.32
$59.90
 $68.02
 $57.42
 $65.52
Light Louisiana Sweet (LLS) crude oil$74.15
 $51.67
 $71.11
 $51.73
$67.04
 $73.14
 $64.75
 $69.58
Alaska North Slope (ANS) crude oil$75.26
 $52.04
 $72.19
 $52.15
$68.29
 $73.93
 $66.37
 $70.64
Crack Spreads              
Dated Brent (NYH) 2-1-1$14.62
 $18.12
 $14.15
 $14.84
$13.54
 $14.96
 $11.72
 $13.90
WTI (Chicago) 4-3-1$18.05
 $18.82
 $15.84
 $14.70
$21.10
 $17.56
 $16.79
 $14.74
LLS (Gulf Coast) 2-1-1$13.38
 $16.69
 $13.26
 $13.75
$12.65
 $13.52
 $11.29
 $13.19
ANS (West Coast) 4-3-1$14.84
 $20.66
 $16.67
 $18.78
$22.96
 $18.70
 $18.33
 $17.59
Crude Oil Differentials              
Dated Brent (foreign) less WTI$5.44
 $3.97
 $5.29
 $2.47
$9.06
 $6.40
 $8.74
 $5.23
Dated Brent less Maya (heavy, sour)$9.12
 $8.75
 $10.21
 $6.77
$7.27
 $12.40
 $5.69
 $10.78
Dated Brent less WTS (sour)$19.79
 $4.96
 $13.41
 $3.63
$10.73
 $14.78
 $10.15
 $10.20
Dated Brent less ASCI (sour)$4.42
 $3.82
 $4.69
 $3.58
$3.96
 $5.09
 $3.17
 $4.84
WTI less WCS (heavy, sour)$29.30
 $10.03
 $24.55
 $10.83
$12.53
 $18.26
 $11.28
 $22.17
WTI less Bakken (light, sweet)$1.08
 $(0.69) $0.87
 $0.18
$1.06
 $0.39
 $0.41
 $0.70
WTI less Syncrude (light, sweet)$5.59
 $(1.95) $3.00
 $(1.86)$(0.05) $2.98
 $(0.01) $1.69
WTI less LLS (light, sweet)$(4.52) $(3.49) $(4.21) $(2.41)$(7.14) $(5.12) $(7.33) $(4.06)
WTI less ANS (light, sweet)$(5.63) $(3.86) $(5.29) $(2.82)$(8.39) $(5.91) $(8.95) $(5.12)
Natural gas (dollars per MMBTU)$2.86
 $2.95
 $2.85
 $3.05
$2.51
 $2.85
 $2.69
 $2.82

Three Months Ended SeptemberJune 30, 20182019 Compared to the Three Months Ended SeptemberJune 30, 20172018
Overview— Net income PBF Energy net loss was $192.5$21.6 million for the three months ended SeptemberJune 30, 20182019 compared to net income of $347.2$287.7 million for the three months ended SeptemberJune 30, 2017.2018. PBF LLC net incomeloss was $244.9$35.9 million for the three months ended SeptemberJune 30, 20182019 compared to net income of $553.1$385.7 million for the three months ended SeptemberJune 30, 2017.2018. Net incomeloss attributable to PBF Energy was $179.5$32.2 million, or $1.50$(0.27) per diluted share, for the three months ended SeptemberJune 30, 20182019 ($1.50(0.27) per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income,loss, or $1.13$0.83 per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income excluding special items, as described below in Non-GAAP Financial Measures) compared to net income attributable to PBF Energy of $314.4$272.1 million, or $2.85$2.37 per diluted share, for the three months ended SeptemberJune 30, 20172018 ($2.852.37 per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income, or $1.44$1.38 per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income excluding special items, as described below in Non-GAAP Financial Measures). The net income or loss attributable to PBF Energy represents PBF Energy’s equity interest in PBF LLC’s pre-tax income, less applicable income tax (benefit) expense. PBF Energy’s weighted-average equity interest in PBF LLC was 99.0% and 96.6%98.4% for the three months ended SeptemberJune 30, 2019 and 2018, and 2017, respectively.

Our results for the three months ended SeptemberJune 30, 20182019 were positivelynegatively impacted by special items consisting of a non-cash, pre-tax lower of cost or market (“LCM”) inventory adjustment of approximately $54.8$182.0 million, or $40.3 million net of tax, a pre-tax change in the Tax Receivable Agreement liability (as defined in “Note 10 - Commitments and Contingencies” of our Notes to Condensed Consolidated Financial Statements) of $7.8

million, or $5.7 million net of tax, and a pre-tax gain on the Torrance land sale of $43.8 million, or $32.2 million net of tax. These favorable impacts were partially offset by a special item related to the early return of certain leased railcars resulting in a pre-tax charge of $44.6 million, or $32.8$133.8 million net of tax. Our results for the three months ended SeptemberJune 30, 20172018 were positively impacted by a pre-tax LCM inventory adjustment of approximately $265.1$158.0 million, or $160.7 million net of tax, and a pre-tax change in the Tax Receivable Agreement liability of $0.6 million, or $0.3$116.3 million net of tax. The LCM inventory adjustments were recorded due to movements in the price of crude oil and refined products in the periods presented.
Excluding the impact of these special items, our results were positivelynegatively impacted by favorableunfavorable movements in crude differentials higherand overall lower throughput volumes and barrels sold across the majority of our refineries and reduced regulatory compliance costs, offset by lower crack spreads realized at eachas a result of our refineries,ongoing turnarounds, which were favorably impactedcompleted in the prior year by the hurricane-related effect onsecond quarter of 2019, despite stronger refining margins due to tightening product inventories, specifically distillates.in the Mid-Continent and West Coast. Our results infor the current periodthree months ended June 30, 2019 were also negatively impacted by higher general and administrative costs and increased depreciation and amortization expense.expense associated with our continued investment in our refining assets and the effect of significant turnaround activity during the first half of the year.
Revenues— Revenues totaled $7.6$6.6 billion for the three months ended SeptemberJune 30, 20182019 compared to $5.5$7.4 billion for the three months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $2.2$0.9 billion, or 39.6%11.9%. Revenues per barrel were $83.55$74.24 and $63.79$80.39 for the three months ended SeptemberJune 30, 2019 and 2018, and 2017, respectively, an increasea decrease of 31.0%7.7% directly related to higherlower hydrocarbon commodity prices. For the three months ended SeptemberJune 30, 2019, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 325,800 bpd, 163,200 bpd, 201,400 bpd and 163,700 bpd, respectively. For the three months ended June 30, 2018, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 354,600359,900 bpd, 172,100152,900 bpd, 195,500188,500 bpd and 166,200165,300 bpd, respectively. The throughput rates at our East Coast refineries were lower in the three months ended June 30, 2019 compared to the same period in 2018 due to planned downtime associated with the turnarounds of the crude unit at our Paulsboro refinery and coker at our Delaware City refinery, which were completed during the second quarter of 2019. Throughput rates in the Mid-Continent were higher in the three months ended June 30, 2019 compared to the same period in 2018 due to a planned turnaround at our Toledo refinery in the second quarter of the prior year. For the three months ended SeptemberJune 30, 2017,2019, the total throughput ratesbarrels sold at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 343,700358,700 bpd, 160,600171,800 bpd, 200,400243,800 bpd and 145,000196,800 bpd, respectively. The throughput rates at our East Coast, Mid-Continent and West Coast refineries were higher in the three months ended September 30, 2018 compared to the same period in 2017. Throughput rates at our Gulf Coast refinery were in line with the same quarter of the prior year, whereas our East Coast and Mid-Continent refineries ran at higher rates during the quarter taking advantage of a relatively strong margin environment. The throughput rates at our West Coast refinery increased due to planned downtime in 2017 related to its first significant turnaround under our ownership, which was completed early in the third quarter of 2017. For the three months ended SeptemberJune 30, 2018, the total barrels sold at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 380,200401,100 bpd, 175,800162,900 bpd, 242,800250,000 bpd and 196,000 bpd, respectively. For the three months ended September 30, 2017, the total barrels sold at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 359,700 bpd, 167,300 bpd, 233,400 bpd and 173,300203,600 bpd, respectively. Total refined product barrels sold were higher than throughput rates, reflecting sales from inventory as well as sales and purchases of refined products outside the refinery.our refineries.
Consolidated Gross Margin— Consolidated gross margin totaled $315.2$66.8 million for the three months ended SeptemberJune 30, 20182019 compared to $648.1$484.2 million for the three months ended SeptemberJune 30, 2017,2018, a decrease of approximately $332.9$417.4 million. Gross refining margin (as described below in Non-GAAP Financial Measures) totaled $765.8$526.5 million, or $9.37$6.76 per barrel of throughput ($755.5 million or $9.25 per barrel of throughput excluding the impact of special items), for the three months ended SeptemberJune 30, 20182019 compared to $1,064.0$928.3 million, or $13.61$11.77 per barrel of throughput ($798.9 million or $10.22 per barrel of throughput excluding the impact of special items), for the three months ended SeptemberJune 30, 2017,2018, a decrease of approximately $298.2$401.8 million. Gross refining margin excluding special items totaled $708.5 million or $43.4$9.10 per barrel of throughput for the three months ended June 30, 2019 compared to $770.3 million excluding special items.or $9.77 per barrel of throughput for the three months ended June 30, 2018, a decrease of $61.8 million.
Consolidated gross margin and gross refining margin decreased due to overall lower crack spreads in comparison to the same period in 2017, partially offset by favorable movements in crude differentials and higher throughput volumes and barrels sold across the majority of our refineries. During the three months ended September 30, 2017 we experienced higher crack spreads realized at each of our refineries, which were negatively impacted by the hurricane-related reduction in refining throughput in the Gulf Coast region. In addition, consolidated gross margin and gross refining margin were positively impacted in the current and prior year by special items. For the three months ended September 30, 2018, special items impacting our margin calculations included a non-cash LCM inventory adjustment of approximately $54.8$182.0 million on a net basis, resulting from an increasethe decrease in crude oil

and refined product prices in comparison to the prices at the end of the secondfirst quarter of 2018, partially offset by a $44.6 million charge resulting from costs associated with the early return of certain leased railcars.2019. The non-cash LCM inventory adjustment increased consolidated gross margin and gross refining margin by approximately $265.1$158.0 million on a net basis in the thirdsecond quarter of 2017.2018. Gross refining margin excluding the impact of special items decreased due to unfavorable movements in crude differentials and reduced throughput rates in the East Coast and West Coast, partially offset by higher throughput rates in the Mid-Continent and Gulf Coast and higher crack spreads in the Mid-Continent and West Coast.
Additionally, our results continue to be impacted by significant costs to comply with the Renewable Fuel Standard (“RFS”), although at a reduced level from the prior year. Total RFS costs were $33.9$30.9 million for the three months ended SeptemberJune 30, 20182019 in comparison to $83.4$39.2 million for the three months ended SeptemberJune 30, 2017.2018.

Average industry refining margins in the Mid-Continent were slightly weakermixed during the three months ended SeptemberJune 30, 2018 as compared2019 in comparison to the same period in 2017. The WTI (Chicago) 4-3-1 industry crack spread was $18.05 per barrel, or 4.1% lower,2018, primarily as a result of varying regional inventory levels of gasoline and seasonal and unplanned refining downtime issues impacting product margins. Crude oil differentials were generally unfavorable in the three months ended September 30, 2018 as comparedcomparison to $18.82 per barrel in the same period in 2017. Our refinery specific2018, with notable light-heavy crude slate in the Mid-Continent was impacted by an improving WTI/Bakken differential which averaged a discount of $1.08 per barrel in the three months ended September 30, 2018, as compared to a premium of $0.69 per barrel in the same period in 2017. Additionally, the WTI/Syncrude differential averaged a discount of $5.59 per barrel during the three months ended September 30, 2018 as compared to a premium of $1.95 per barrel in the same period of 2017.compression negatively impacting our refining gross margin.
On the East Coast, the Dated Brent (NYH) 2-1-1 industry crack spread was approximately $14.62$13.54 per barrel, or 19.3%9.5% lower, in the three months ended SeptemberJune 30, 2018,2019, as compared to $18.12$14.96 per barrel in the same period in 2017. The2018. Our margins were negatively impacted from our refinery specific slate on the East Coast by tightening in the Dated Brent/Maya differential, was $0.37 higherwhich decreased by $5.13 per barrel in the three months ended SeptemberJune 30, 20182019 as compared to the same period in 2017 and2018. In addition, the Dated Brent/WTIWTI/WCS differential was $1.47 higherdecreased significantly to $12.53 per barrel in the three months ended SeptemberJune 30, 2019 compared to $18.26 in the same period in 2018, which unfavorably impacted our cost of heavy Canadian crude. This decrease was offset by improving WTI/Bakken differential, which increased $0.67 per barrel in the three months ended June 30, 2019 as compared to the same period in 2017.2018.
Gulf CoastAcross the Mid-Continent, the WTI (Chicago) 4-3-1 industry refiningcrack spread was $21.10 per barrel, or 20.2% higher, in the three months ended June 30, 2019 as compared to $17.56 per barrel in the same period in 2018. Our margins weakenedwere positively impacted from our refinery specific slate in the Mid-Continent by an increasing WTI/Bakken differential, which averaged $1.06 per barrel in the three months ended June 30, 2019, as compared to $0.39 per barrel in the same period in 2018. This increase was offset by tightening in the WTI/Syncrude differential, which averaged a premium of $0.05 per barrel during the three months ended SeptemberJune 30, 20182019 as compared to a discount of $2.98 per barrel in the same period in 2017. Theof 2018.
On the Gulf Coast, the LLS (Gulf Coast) 2-1-1 industry crack spread was $13.38$12.65 per barrel, or 19.8%6.4% lower, in the three months ended SeptemberJune 30, 20182019 as compared to $16.69$13.52 per barrel in the same period in 2017. Additionally, crude differentials weakened with2018. Margins on the Gulf Coast were negatively impacted from our refinery specific slate by a declining WTI/LLS differential, averagingwhich averaged a premium of $4.52$7.14 per barrel during the three months ended SeptemberJune 30, 20182019 as compared to a premium of $3.49$5.12 per barrel in the same period of 2017.2018.
Additionally,On the West Coast industry refining margins decreased during the three months ended September 30, 2018 as compared to the same period in 2017. The ANS (West Coast) 4-3-1 industry crack spread was $14.84$22.96 per barrel, or 28.2% lower,22.8% higher, in the three months ended SeptemberJune 30, 20182019 as compared to $20.66$18.70 per barrel in the same period in 2017. Crude differentials weakened with2018. Margins on the West Coast were negatively impacted from our refinery specific slate by a weakening WTI/ANS differential, averagingwhich averaged a premium of $5.63$8.39 per barrel during the three months ended SeptemberJune 30, 20182019 as compared to a premium of $3.86$5.91 per barrel in the same period of 2017.2018.
Favorable movements in these benchmark crude differentials typically result in lower crude costs and positively impact our earnings while reductions in these benchmark crude differentials typically result in higher crude costs and negatively impact our earnings.
Operating Expenses— Operating expenses totaled $424.3$433.2 million for the three months ended SeptemberJune 30, 20182019 compared to $402.8$417.7 million for the three months ended SeptemberJune 30, 2017,2018, an increase of $21.5$15.5 million, or 5.3%3.7%. Of the total $424.3$433.2 million of operating expenses for the three months ended SeptemberJune 30, 2018, $409.62019, $409.7 million, or $5.01$5.27 per barrel of throughput, related to expenses incurred by the Refining segment, while the remaining $14.7$23.5 million related to expenses incurred by the Logistics segment ($389.5402.7 million, or $4.98$5.11 per barrel, and $13.3$15.0 million of operating expenses for the three months ended SeptemberJune 30, 20172018 related to the Refining and Logistics segments, respectively). The increaseIncreases in operating expenses was driven bywere mainly attributed to higher energyoutside service costs attributed to turnaround and utility costs driven by higher throughput across our system.maintenance activity. Operating expenses related to our Logistics segment were generally consistent withincreased when compared to the prior year and consist of costssame period in 2018 primarily due to expenses related to the operation and maintenanceoperations of PBFX’s assets.recently acquired assets and higher environmental clean-up costs.

General and Administrative Expenses— General and administrative expenses totaled $69.9$53.6 million for the three months ended SeptemberJune 30, 20182019 compared to $58.3$58.7 million for the three months ended SeptemberJune 30,

2017, an increase 2018, a decrease of approximately $11.7$5.1 million or 20.0%8.7%. The increasedecrease in general and administrative expenses for the three months ended SeptemberJune 30, 20182019 in comparison to the three months ended SeptemberJune 30, 20172018 is primarily related to higherlower employee related expenses, including incentive compensation and retirement benefits.compensation. Our general and administrative expenses are comprised of the personnel, facilities and other infrastructure costs necessary to support our refineries and related logisticallogistics assets.
Gain (Loss)Loss on Sale of Assets— There was a net gainloss of $43.7$0.8 million on the sale of assets for the three months ended SeptemberJune 30, 2019 compared to a net loss of $0.6 million for the three months ended June 30, 2018, mainly attributed to a $43.8 million gainboth of which were related to the Torrance land sale. There was a de minimis loss on the sale of non-operating refinery assets for the three months ended September 30, 2017.assets.
Depreciation and Amortization Expense— Depreciation and amortization expense totaled $93.3$107.1 million for the three months ended SeptemberJune 30, 20182019 (including $90.7$104.2 million recorded within Cost of sales) compared to $78.5$92.3 million for the three months ended SeptemberJune 30, 20172018 (including $75.9$89.7 million recorded within Cost of sales), an increase of $14.8 million. The increase was a result of additional depreciation expense associated with a general increase in our fixed asset base due to capital projects and turnarounds completed since the thirdsecond quarter of 2017 which included the first significant Torrance refinery turnaround under our ownership.2018.
Change in Tax Receivable Agreement Liability— Change in the Tax Receivable Agreement liability for the three months ended September 30, 2018 represented a gain of $7.8 million compared to a gain of $0.6 million in the three months ended September 30, 2017.
Change in Fair Value of Catalyst Leases— Change in the fair value of catalyst leases represented a gain of $1.6 million for the three months ended September 30, 2018 compared to a gain of $0.5 million for the three months ended SeptemberJune 30, 2017.2019 compared to a gain of $4.1 million for the three months ended June 30, 2018. These gains relate to the change in value of the precious metals underlying the sale and leaseback of our refineries’ precious metals catalyst, which we are obligated to repurchase at fair market value on the lease termination dates.
Interest Expense, net— PBF Energy interest expense totaled $42.3$42.1 million for the three months ended SeptemberJune 30, 20182019 compared to $37.0$43.4 million for the three months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $5.3$1.3 million. This net increasedecrease is mainly attributable to lower outstanding revolver borrowings during the interest costs associated with the issuance of the new PBFX 2023 Senior Notes in October 2017 and higher borrowings under the PBFX Revolving Credit Facility.three months ended June 30, 2019. Interest expense includes interest on long-term debt including the PBFX credit facilities, costs related to the sale and leaseback of our precious metals catalyst, financing costs associated with the Inventory Intermediation Agreements with J. Aron, letter of credit fees associated with the purchase of certain crude oils and the amortization of deferred financing costs. PBF LLC interest expense totaled $44.5 million and $38.9$45.4 million for the three months ended SeptemberJune 30, 20182019 and SeptemberJune 30, 2017,2018, respectively (inclusive of $2.2$2.4 million and $1.9$2.0 million, respectively, of incremental interest expense on the affiliate note payable with PBF Energy that eliminates in consolidation at the PBF Energy level).
Income Tax Expense— PBF LLC is organized as a limited liability company and PBFX is a master limited partnership,an MLP, both of which are treated as “flow-through” entities for federal income tax purposes and therefore are not subject to income tax. However, two subsidiaries of Chalmette Refining and theour Canadian subsidiary of PBF Holding are treated as C-Corporations for income tax purposes and may incur income taxes with respect to their earnings, as applicable. The members of PBF LLC are required to include their proportionate share of PBF LLC’s taxable income or loss, which includes PBF LLC’s allocable share of PBFX’s pre-tax income or loss, on their respective tax returns. PBF LLC generally makes distributions to its members, per the terms of PBF LLC’s amended and restated limited liability company agreement, related to such taxes on a pro-rata basis. PBF Energy recognizes an income tax expense or benefit in our consolidated financial statements based on PBF Energy’s allocable share of PBF LLC’s pre-tax income or loss, which was approximately 99.0% and 96.6%98.4%, on a weighted-average basis for the three months ended SeptemberJune 30, 20182019 and 2017,2018, respectively. PBF Energy’s condensed consolidated financial statementsCondensed Consolidated Financial Statements do not reflect any benefit or provision for income taxes on the pre-tax income or loss attributable to the noncontrolling interests in PBF LLC or PBFX (although, as described above, PBF LLC must make tax distributions to all its members on a pro-rata basis). PBF Energy’s effective tax rate, excluding the impact of noncontrolling interest, for the three months ended SeptemberJune 30, 2019 and 2018 was 24.6% and 2017 was 25.5% and 39.4%26.0%,

respectively, reflecting tax adjustments for discrete items andduring the impact of the Tax Cuts and Jobs Act (“TCJA”) which, among other things, reduced the U.S federal corporate tax rate from 35% to 21%.quarters.

Noncontrolling Interest— PBF Energy is the sole managing member of, and has a controlling interest in, PBF LLC. As the sole managing member of PBF LLC, PBF Energy operates and controls all of the business and affairs of PBF LLC and its subsidiaries. PBF Energy consolidates the financial results of PBF LLC and its subsidiaries, including PBFX. With respect to the consolidation of PBF LLC, the Company records a noncontrolling interest for the economic interest in PBF LLC held by members other than PBF Energy, and with respect to the consolidation of PBFX, the Company records a noncontrolling interest for the economic interests in PBFX held by the public unit holdersunitholders of PBFX, and with respect to the consolidation of PBF Holding, the Company records a 20% noncontrolling interest for the ownership interests in two subsidiaries of Chalmette Refining held by a third party. The total noncontrolling interest on the condensed consolidated statementsCondensed Consolidated Statements of operationsOperations represents the portion of the Company’s earnings or loss attributable to the economic interests held by members of PBF EnergyLLC other than PBF Energy, by the public common unitholders of PBFX and by the third party stockholderthird-party stockholders of the twocertain of Chalmette RefiningRefining’s subsidiaries. The total noncontrolling interest on the balance sheetCondensed Consolidated Balance Sheets represents the portion of the Company’s net assets attributable to the economic interests held by the members of PBF LLC other than PBF Energy, by the public common unit holdersunitholders of PBFX and by the third party stockholderthird-party stockholders of the two Chalmette Refining subsidiaries. PBF Energy’s weighted-average equity noncontrolling interest ownership percentage in PBF LLC for the three months ended SeptemberJune 30, 20182019 and 20172018 was approximately 1.0% and 3.4%1.6%, respectively. The carrying amount of the noncontrolling interest on our condensed consolidated balance sheetCondensed Consolidated Balance Sheets attributable to the noncontrolling interest is not equal to the noncontrolling interest ownership percentage due to the effect of income taxes and related agreements that pertain solely to PBF Energy.
NineSix Months Ended SeptemberJune 30, 20182019 Compared to the NineSix Months Ended SeptemberJune 30, 20172018
Overview— PBF Energy net income was $522.0$219.8 million for the ninesix months ended SeptemberJune 30, 20182019 compared to a net income of $223.0$329.5 million for the ninesix months ended SeptemberJune 30, 2017.2018. PBF LLC net income was $682.3$291.5 million for the ninesix months ended SeptemberJune 30, 20182019 compared to a net income of $327.4$437.4 million for the ninesix months ended SeptemberJune 30, 2017.2018. Net income attributable to PBF Energy Inc. stockholders was $482.1$197.0 million, or $4.16$1.63 per diluted share, for the ninesix months ended SeptemberJune 30, 20182019 ($4.161.63 per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income, or $2.24$(0.33) per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net incomeloss excluding special items, as described below in Non-GAAP Financial Measures) compared to net income attributable to PBF Energy Inc. stockholders of $173.6$302.5 million, or $1.57$2.66 per diluted share, for the ninesix months ended SeptemberJune 30, 20172018 ($1.572.66 per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income, or $1.18$1.10 per share on a fully-exchanged, fully-diluted basis based on adjusted fully-converted net income excluding special items, as described below in Non-GAAP Financial Measures). The net income attributable to PBF Energy Inc. stockholders represents PBF Energy’s equity interest in PBF LLC’s pre-tax income, less applicable income tax (benefit) expense. PBF Energy’s weighted-average equity interest in PBF LLC was 98.1%99.0% and 96.6%97.6% for the ninesix months ended SeptemberJune 30, 20182019 and 2017,2018, respectively.
Our results for the ninesix months ended SeptemberJune 30, 20182019 were positively impacted by special items consisting of a non-cash, pre-tax LCM inventory adjustment of approximately $300.5$324.0 million, or $221.1 million net of tax, a pre-tax change in the Tax Receivable Agreement liability of $7.8 million, or $5.7 million net of tax, and a pre-tax gain on the Torrance land sale of $43.8 million, or $32.2 million net of tax. These favorable impacts were partially offset by a special item related to the early return of certain leased railcars, resulting in a pre-tax charge of $44.6 million, or $32.8$238.3 million net of tax. Our results for the ninesix months ended SeptemberJune 30, 20172018 were positively impacted by a pre-tax LCM inventory adjustment of approximately $97.9$245.7 million, or $59.4 million net of tax, and a pre-tax change in the Tax Receivable Agreement liability of $0.6 million, or $0.3 million net of tax, which were partially offset by a special item related to pre-tax debt extinguishment costs associated with the early retirement of our 2020 Senior Secured Notes of $25.5 million, or $15.4$180.8 million net of tax. The LCM inventory adjustments were recorded due to movements in the price of crude oil and refined products in the periods presented.

Excluding the impact of these special items, our results were positivelynegatively impacted by favorableunfavorable movements in crude differentials higherand overall lower throughput volumes and barrels sold across the majority of our refineries, and reduced regulatory compliance costs, offset by lower crack spreads realized at the majority of our refineries, which were favorably impacteddespite stronger refining margins in the prior year by the hurricane-related effect on refining margins due to tightening product inventories, specifically distillates.Mid-Continent and West Coast. Our results infor the current year periodsix months ended June 30, 2019 were also negatively impacted by higher general and administrative costs and increased depreciation and amortization expense.expense associated with our continued investment in our refining assets and the effect of significant turnaround activity during the first half of the year.

Revenues— Revenues totaled $20.9$11.8 billion for the ninesix months ended SeptemberJune 30, 20182019 compared to $15.3$13.2 billion for the ninesix months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $5.6$1.5 billion, or 37.0%11.1%. Revenues per barrel were $78.96$70.45 and $62.38$76.53 for the ninesix months ended SeptemberJune 30, 2019 and 2018, and 2017, respectively, an increasea decrease of 26.6%7.9% directly related to higherlower hydrocarbon commodity prices. For the ninesix months ended SeptemberJune 30, 2019, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 315,500 bpd, 155,600 bpd, 183,100 bpd and 144,700 bpd, respectively. For the six months ended June 30, 2018, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 349,200346,500 bpd, 149,500138,000 bpd, 184,400178,900 bpd and 168,700 bpd, respectively. For the nine months ended September 30, 2017, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 330,100 bpd, 146,500 bpd, 182,600 bpd and 126,900169,900 bpd, respectively. The throughput rates at our East Coast and West Coast refineries were higherlower in the ninesix months ended SeptemberJune 30, 20182019 compared to the same period in 2017.2018 due to planned downtime associated with turnarounds of the coker and associated units at our Delaware City and Torrance refineries and the crude unit at our Paulsboro refinery, all of which were completed in the first half of 2019, and unplanned downtime at our Delaware City refinery in the first quarter of 2019. Throughput rates at our Mid-Continent andrefinery were higher in the six months ended June 30, 2019 compared to the same period in 2018 due to a planned turnaround at our Toledo refinery in the first half of the prior year. Throughput rates at our Gulf Coast refineriesrefinery were in line with the prior year despite planned downtimes duringyear. For the first half of 2018. The throughput ratessix months ended June 30, 2019, the total barrels sold at our East Coast, refineries increased due to planned downtime at our Delaware City refinery during 2017. The throughput rates at ourMid-Continent, Gulf Coast and West Coast refinery increased due to planned downtime in the prior year as part of the first significant turnaround of the refinery under our ownershiprefineries averaged approximately 353,900 bpd, 164,900 bpd, 229,800 bpd and improved refinery performance experienced in the current year.174,900 bpd, respectively. For the ninesix months ended SeptemberJune 30, 2018, the total barrels sold at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 378,700378,000 bpd, 158,300149,300 bpd, 235,900232,400 bpd and 196,500 bpd, respectively. For the nine months ended September 30, 2017, the total barrels sold at our East Coast, Mid-Continent, Gulf Coast and West Coast refineries averaged approximately 358,000 bpd, 160,600 bpd, 221,700 bpd and 155,200196,700 bpd, respectively. Total refined product barrels sold were higher than throughput rates, reflecting sales from inventory as well as sales and purchases of refined products outside the refinery.our refineries.
Consolidated Gross Margin— Consolidated gross margin totaled $960.6$491.8 million for the ninesix months ended SeptemberJune 30, 2018,2019, compared to $631.4$645.5 million for the ninesix months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $329.1$153.7 million. Gross refining margin (as described below in Non-GAAP Financial Measures) totaled $2,304.1$1,459.0 million, or $9.90$10.08 per barrel of throughput ($2,048.2for the six months ended June 30, 2019 compared to $1,538.3 million, or $8.80$10.20 per barrel of throughput excluding the impact of special items), for the ninesix months ended SeptemberJune 30, 2018, compared to $1,912.9a decrease of approximately $79.3 million. Gross refining margin excluding special items totaled $1,135.0 million or $8.91$7.85 per barrel of throughput ($1,814.9for the six months ended June 30, 2019 compared to $1,292.6 million or $8.46$8.57 per barrel of throughput excluding the impact of special items), for the ninesix months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $391.2 million, or $233.3 million excluding special items.$157.6 million.
Consolidated gross margin and gross refining margin increased due to generally favorable movements in crude differentials and higher throughput volumes and barrels sold across the majority of our refineries. In addition, consolidated gross margin and gross refining margin were positively impacted in the current and prior year by special items. For the nine months ended September 30, 2018, special items impacting our margin calculations included a non-cash LCM inventory adjustment of approximately $300.5$324.0 million on a net basis resulting from anthe increase in crude oil and refined product prices in comparisonfrom the year ended 2018 to the prices at the end of 2017, partially offset by a $44.6 million charge resulting from costs associated with the early returnsecond quarter of certain leased railcars.2019. The non-cash LCM inventory adjustment increased consolidated gross margin and gross refining margin by approximately $97.9$245.7 million for the ninesix months ended SeptemberJune 30, 2017.2018. Gross refining margin excluding the impact of special items decreased due to unfavorable movements in certain crude differentials and refining margins and reduced throughput rates in the East Coast and West Coast, partially offset by higher throughput rates in the Mid-Continent and Gulf Coast and stronger crack spreads in the Mid-Continent and West Coast.
Additionally, our results continue to be impacted by significant costs to comply with the RFS, although at a reduced level from the prior year. Total RFS costs were $117.0$60.4 million for the ninesix months ended SeptemberJune 30, 20182019 in comparison to $203.2$83.1 million for the ninesix months ended SeptemberJune 30, 2017.2018.
Average industry refining margins in the Mid-Continent were strongermixed during the ninesix months ended SeptemberJune 30, 2018 as compared2019 in comparison to the same period in 2017. The WTI (Chicago) 4-3-1 industry crack spread was

$15.84 per barrel, or 7.8% higher,2018, primarily as a result of varying regional inventory levels of gasoline and seasonal and unplanned refining downtime issues impacting product margins. Crude oil differentials were generally unfavorable in the nine months ended September 30, 2018 as comparedcomparison to $14.70 per barrel in the same period in 2017. Our refinery specific2018, with notable light-heavy crude slate in the Mid-Continent was impacted by an improving WTI/Bakken differential which was approximately $0.87 per barrel in the nine months ended September 30, 2018, as compared to $0.18 per barrel in the same period in 2017. Additionally, the WTI/Syncrude differential averaged a discount of $3.00 per barrel during the nine months ended September 30, 2018 as compared to a premium of $1.86 per barrel in the same period of 2017.compression negatively impacting our gross refining margin.

On the East Coast, the Dated Brent (NYH) 2-1-1 industry crack spread was approximately $14.15$11.72 per barrel, or 4.6%15.7% lower, in the ninesix months ended SeptemberJune 30, 2018,2019, as compared to $14.84$13.90 per barrel in the same period in 2017. The2018. Our margins were negatively impacted from our refinery specific slate on the East Coast by tightening in the Dated Brent/Maya differential was $3.44 higherand WTI/Bakken differentials, which decreased by $5.09 per barrel and $0.29 per barrel, respectively, in the nine months ended September 30, 2018 as comparedcomparison to the same period in 2017. The Dated Brent/2018. In addition, the WTI/WCS differential decreased significantly to $11.28 per barrel in 2019 compared to $22.17 in 2018, which unfavorably impacted our cost of heavy Canadian crude.
Across the Mid-Continent, the WTI differential(Chicago) 4-3-1 industry crack spread was $2.82$16.79 per barrel, or 13.9% higher, in the ninesix months ended SeptemberJune 30, 20182019 as compared to $14.74 per barrel in the same period in 2017, and2018. Our margins were negatively impacted from our refinery specific slate in the Mid-Continent by a decreasing WTI/Bakken differential, was approximately $0.69which averaged a discount of $0.41 per barrel higher in the ninesix months ended SeptemberJune 30, 20182019, as compared to a discount of $0.70 per barrel in the same period in 2017.
Gulf Coast industry refining margins slightly decreased2018. Additionally, the WTI/Syncrude differential averaged a premium of $0.01 per barrel during the ninesix months ended SeptemberJune 30, 20182019 as compared to a discount of $1.69 per barrel in the same period in 2017. Theof 2018.
On the Gulf Coast, the LLS (Gulf Coast) 2-1-1 industry crack spread was $13.26$11.29 per barrel, or 3.6%14.4% lower, in the ninesix months ended SeptemberJune 30, 20182019 as compared to $13.75$13.19 per barrel in the same period in 2017. Crude differentials weakened with2018. Margins on the Gulf Coast were negatively impacted from our refinery specific slate by a weakening WTI/LLS differential, averagingwhich averaged a premium of $4.21$7.33 per barrel during the ninesix months ended SeptemberJune 30, 20182019 as compared to a premium of $2.41$4.06 per barrel in the same period of 2017.2018.
Additionally,On the West Coast industry refining margins decreased during the nine months ended September 30, 2018 as compared to the same period in 2017. The ANS (West Coast) 4-3-1 industry crack spread was $16.67$18.33 per barrel, or 11.2% lower,4.2% higher, in the ninesix months ended SeptemberJune 30, 20182019 as compared to $18.78$17.59 per barrel in the same period in 2017. Crude differentials weakened with2018. Margins on the West Coast were negatively impacted from our refinery specific slate by a weakening WTI/ANS differential, averagingwhich averaged a premium of $5.29$8.95 per barrel during the ninesix months ended SeptemberJune 30, 20182019 as compared to a premium of $2.82$5.12 per barrel in the same period of 2017.2018.
Favorable movements in these benchmark crude differentials typically result in lower crude costs and positively impact our earnings while reductions in these benchmark crude differentials typically result in higher crude costs and negatively impact our earnings.
Operating Expenses— Operating expenses totaled $1,268.2$912.2 million for the ninesix months ended SeptemberJune 30, 20182019 compared to $1,266.9$843.8 million for the ninesix months ended SeptemberJune 30, 2017,2018, an increase of approximately $1.3$68.4 million, or 0.1%8.1%. Of the total $1,268.2$912.2 million of operating expenses for the ninesix months ended SeptemberJune 30, 2018, $1,223.82019, $863.1 million or $5.26$5.97 per barrel of throughput, related to expenses incurred by the Refining segment, while the remaining $44.4$49.1 million related to expenses incurred by the Logistics segment ($1,224.8814.1 million or $5.71$5.40 per barrel, and $42.1$29.7 million of operating expenses for the ninesix months ended SeptemberJune 30, 20172018 related to the Refining and Logistics segments, respectively). Operating expenses for the Company were in line with the prior year. DecreasesIncreases in operating expenses on a per barrel basis were driven by increased system reliabilitymainly attributed to higher outside service costs attributed to turnaround and our focused efforts on reducing operating costs. Additionally, there was a decrease in supplies and materials due to our Torrance refinery experiencing higher costs in 2017 related to its turnaround. These decreases were offset by higher energy and utility costs as a result of overall increased throughput.maintenance activity. Operating expenses related to our Logistics segment were generally consistent withincreased when compared to the prior year and consist of costssame period in 2018 due to expenses related to the operation and maintenanceoperations of PBFX’s assets.recently acquired assets and higher environmental clean-up costs.
General and Administrative Expenses— General and administrative expenses totaled $191.4$111.2 million for the ninesix months ended SeptemberJune 30, 20182019 compared to $143.1$121.5 million for the ninesix months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $48.3$10.3 million or 33.7%8.5%. The increasedecrease in general and administrative expenses for the ninesix months ended SeptemberJune 30, 20182019 in comparison to the ninesix months ended SeptemberJune 30, 20172018 primarily related to higherlower employee related expenses, including incentive compensation, and retirement benefits.partially offset by higher legal settlement costs. Our general and administrative expenses are comprised of the personnel, facilities and other infrastructure costs necessary to support our refineries and related logisticallogistics assets.

Gain (Loss)Loss on Sale of Assets— ThereNet loss on sale of assets was a net gain of $43.1$0.8 million for the ninesix months ended SeptemberJune 30, 2018 mainly attributed2019 compared to a $43.8 million gain related to the Torrance land sale. There was a loss of $0.90.7 million for the ninesix months ended SeptemberJune 30, 20172018. These losses are related to the sale of non-operating refinery assets.

Depreciation and Amortization Expense— Depreciation and amortization expense totaled $271.6$212.9 million for the ninesix months ended SeptemberJune 30, 20182019 (including $263.8$207.2 million recorded within Cost of sales) compared to $208.2$178.3 million for the ninesix months ended SeptemberJune 30, 20172018 (including $197.8$173.0 million recorded within Cost of sales), an increase of approximately $63.5$34.6 million. The increase was a result of additional depreciation expense associated with a general increase in our fixed asset base due to capital projects and turnarounds completed since the thirdsecond quarter of 2017,2018, as well as accelerated amortization related to the Delaware City and Torrance refinery turnarounds, which includedwere completed in the first significant Torrance refinery turnaround under our ownership.half of 2019.
Change in Tax Receivable Agreement Liability— Change in the Tax Receivable Agreement liability for the nine months ended September 30, 2018 represented a gain of $7.8 million compared to a gain of $0.6 million in the nine months ended September 30, 2017.
Change in Fair Value of Catalyst Leases— Change in the fair value of catalyst leases represented a gainloss of $5.8$2.6 million for the ninesix months ended SeptemberJune 30, 20182019 compared to a lossgain of $1.0$4.1 million for the ninesix months ended SeptemberJune 30, 2017.2018. These gains and losses relate to the change in value of the precious metals underlying the sale and leaseback of our refineries’ precious metals catalyst, which we are obligated to repurchase at fair market value on the lease termination dates.
Debt extinguishment costs— Debt extinguishment costs of $25.5 million incurred in the nine months ended September 30, 2017 relate to nonrecurring charges associated with debt refinancing activity calculated based on the difference between the carrying value of the 2020 Senior Secured Notes on the date that they were reacquired and the amount for which they were reacquired. There were no such costs in the same period of 2018.
Interest Expense, net— PBF Energy interest expense totaled $128.9$81.6 million for the ninesix months ended SeptemberJune 30, 20182019 compared to $114.9$86.6 million for the ninesix months ended SeptemberJune 30, 2017, an increase2018, a decrease of approximately $14.1$5.0 million. This net increasedecrease is mainly attributable to lower outstanding revolver borrowings during the interest costs associated with the issuance of the new PBFX 2023 Senior Notes in October 2017 and higher borrowings under the PBFX Revolving Credit Facility.six months ended June 30, 2019. Interest expense includes interest on long-term debt including the PBFX credit facilities, costs related to the sale and leaseback of our precious metals catalyst, financing costs associated with the Inventory Intermediation Agreements with J. Aron, letter of credit fees associated with the purchase of certain crude oils and the amortization of deferred financing costs. PBF LLC interest expense totaled $135.1$86.0 million and $120.9$90.6 million for the ninesix months ended SeptemberJune 30, 20182019 and SeptemberJune 30, 2017,2018, respectively (inclusive of $6.2$4.4 million and $6.1$4.0 million, respectively, of incremental interest expense on the affiliate note payable with PBF Energy that eliminates in consolidation at the PBF Energy level).
Income Tax Expense— PBF LLC is organized as a limited liability company and PBFX is a master limited partnership,an MLP, both of which are treated as “flow-through” entities for federal income tax purposes and therefore are not subject to income tax. However, two subsidiaries of Chalmette Refining and our Canadian subsidiary of PBF Holding are treated as C-Corporations for income tax purposes and may incur income taxes with respect to their earnings, as applicable. The members of PBF LLC are required to include their proportionate share of PBF LLC’s taxable income or loss, which includes PBF LLC’s allocable share of PBFX’s pre-tax income or loss, on their respective tax returns. PBF LLC generally makes distributions to its members, per the terms of PBF LLC’s amended and restated limited liability company agreement, related to such taxes on a pro-rata basis. PBF Energy recognizes an income tax expense or benefit in our consolidated financial statements based on PBF Energy’s allocable share of PBF LLC’s pre-tax income or loss, which was approximately 98.1%99.0% and 96.6%97.6%, on a weighted-average basis for the ninesix months ended SeptemberJune 30, 20182019 and 2017,2018, respectively. PBF Energy’s condensed consolidated financial statementsCondensed Consolidated Financial Statements do not reflect any benefit or provision for income taxes on the pre-tax income or loss attributable to the noncontrolling interests in PBF LLC or PBFX (although, as described above, PBF LLC must make tax distributions to all its members on a pro-rata basis). PBF Energy’s effective tax rate, excluding the impact of noncontrolling interest,interests, for the ninesix months ended SeptemberJune 30, 2019 and 2018 was 26.2% and 2017 was 25.8% and 39.4%26.0%, respectively.

respectively, reflecting tax adjustments for discrete items and the impact of the TCJA which, among other things, reduced the U.S federal corporate tax rate from 35% to 21%.
Noncontrolling Interest— PBF Energy is the sole managing member of, and has a controlling interest in, PBF LLC. As the sole managing member of PBF LLC, PBF Energy operates and controls all of the business and affairs of PBF LLC and its subsidiaries. PBF Energy consolidates the financial results of PBF LLC and its subsidiaries, including PBFX. With respect to the consolidation of PBF LLC, the Company records a noncontrolling interest for the economic interest in PBF LLC held by members other than PBF Energy, and with respect to the consolidation of PBFX, the Company records a noncontrolling interest for the economic interests in PBFX held by the public unit holdersunitholders of PBFX, and with respect to the consolidation of PBF Holding, the Company records a 20% noncontrolling interest for the ownership interests in two subsidiaries of Chalmette Refining held by a third party. The total noncontrolling interest on the condensed consolidated statementsCondensed Consolidated Statements of operationsOperations represents the portion of the Company’s earnings or loss attributable to the economic interests held by members of PBF EnergyLLC other than PBF Energy, andby the public common unit holdersunitholders of PBFX and by the third partythird-party stockholders of the twocertain of Chalmette RefiningRefining’s subsidiaries. The total noncontrolling interest on the balance sheetCondensed Consolidated Balance Sheets represents the portion of the Company’s net assets attributable to the economic interests held by the members of PBF LLC other than PBF Energy, by the public common unitholders of PBFX and by the third partythird-party stockholders of the two Chalmette Refining subsidiaries. PBF Energy’s weighted-average equity noncontrolling interest ownership percentage in PBF LLC for the ninesix months ended SeptemberJune 30, 20182019 and 20172018 was approximately 1.9%1.0% and 3.4%2.4%, respectively. The carrying amount of the noncontrolling interest on our condensed consolidated balance sheetCondensed Consolidated Balance Sheets attributable to the noncontrolling interest is not equal to the noncontrolling interest ownership percentage due to the effect of income taxes and related agreements that pertain solely to PBF Energy.

Non-GAAP Financial Measures
Management uses certain financial measures to evaluate our operating performance that are calculated and presented on the basis of methodologies other than in accordance with GAAP (“Non-GAAP”). These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP, and our calculations thereof may not be comparable to similarly entitled measures reported by other companies. Such Non-GAAP financial measures are presented only in the context of PBF Energy’s results and are not presented or discussed in respect to PBF LLC.
Special Items
The Non-GAAP measures presented include Adjusted Fully-Converted Net Income (loss) excluding special items, EBITDA excluding special items and gross refining margin excluding special items. Special items presented for the three and ninesix months ended SeptemberJune 30, 2019 and June 30, 2018, respectively, relate to an LCM inventory adjustment, changes in the Tax Receivable Agreement liability, gain on the sale of assets related to the Torrance land sale and charges associated with the early return of certain leased railcars. Special items for the three and nine months ended September 30, 2017 relate to an LCM inventory adjustment, changes in the Tax Receivable Agreement liability and debt extinguishment costs.adjustment. See “Notes to Non-GAAP Financial Measures” below for more details on all special items disclosed. Although we believe that Non-GAAP financial measures, excluding the impact of special items, provide useful supplemental information to investors regarding the results and performance of our business and allow for helpful period-over-period comparisons, such Non-GAAP measures should only be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP.
Adjusted Fully-Converted Net Income (Loss)(loss) and Adjusted Fully-Converted Net Income (Loss) Excluding Special Items
PBF Energy utilizes results presented on an Adjusted Fully-Converted basis that reflects an assumed exchange of all PBF LLC Series A Units for shares of PBF Energy Class A common stock of PBF Energy.stock. In addition, we present results on an Adjusted Fully-Converted basis excluding special items as described above. We believe that these Adjusted Fully-Converted measures, when presented in conjunction with comparable GAAP measures, are useful to investors to compare PBF Energy results across different periods and to facilitate an understanding of our operating results.

Neither Adjusted Fully-Converted Net Income (Loss)(loss) nor Adjusted Fully-Converted Net Income (Loss) excluding special items should be considered an alternative to net income (loss) presented in accordance with GAAP. Adjusted Fully-Converted Net Income (Loss)(loss) and Adjusted Fully-Converted Net Income (Loss) excluding special items presented by other companies may not be comparable to our presentation, since each company may define these terms differently. The differences between Adjusted Fully-Converted and GAAP results are as follows:
1.
Assumed exchange of all PBF LLC Series A Units for shares of PBF Energy Class A common stock. As a result of the assumed exchange of all PBF LLC Series A Units, the noncontrolling interest related to these units is converted to controlling interest. Management believes that it is useful to provide the per-share effect associated with the assumed exchange of all PBF LLC Series A Units.
2.
Income Taxes. Prior to PBF Energy’s initial public offering (“IPO”), PBF Energy was organized as a limited liability company treated as a “flow-through” entity for income tax purposes, and even after PBF Energy’s IPO, not all of its earnings are subject to corporate-level income taxes. Adjustments have been made to the Adjusted Fully-Converted tax provisions and earnings to assume that PBF Energy had adopted its post-IPO corporate tax structure for all periods presented and is taxed as a C-corporation in the U.S. at the prevailing corporate rates. These assumptions are consistent with the assumption in clause 1 above that all PBF LLC Series A Units are exchanged for shares of PBF Energy Class A common stock, as the assumed exchange would change the amount of PBF Energy’s earnings that are subject to corporate income tax.

The following table reconciles the Adjusted Fully-Converted results forof PBF Energy with theirits results presented in accordance with GAAP for the three and ninesix months ended SeptemberJune 30, 2019 and 2018 and 2017 (in thousands,millions, except share and per share amount)amounts):
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
 2018 2017 2018 2017
Net income attributable to PBF Energy Inc. stockholders$179,538
 $314,365
 $482,057
 $173,625
Less: Income allocated to participating securities194
 272
 592
 811
Income available to PBF Energy Inc. stockholders - basic179,344
 314,093
 481,465
 172,814
Add: Net income attributable to the noncontrolling interest (1)
2,394
 18,137
 9,790
 9,677
Less: Income tax expense (2)
(632) (7,139) (2,585) (3,809)
Adjusted fully-converted net income$181,106
 $325,091
 $488,670
 $178,682
Special Items: (3)
       
Add: Non-cash LCM inventory adjustment(54,801) (265,077) (300,456) (97,943)
Add: Change in Tax Receivable Agreement liability
 
(7,763) (565) (7,763) (565)
Add: Debt extinguishment costs—
 —
 —
 25,451
Add: Gain on Torrance land sale(43,761) —
 (43,761) —
Add: Early railcar return expense44,571
 —
 44,571
 —
Add: Recomputed income taxes on special items16,309
 104,556
 81,186
 28,755
Adjusted fully-converted net income excluding special items$135,661
 $164,005
 $262,447
 $134,380
        
Weighted-average shares outstanding of PBF Energy Inc.117,029,486
 109,724,595
 113,597,970
 109,634,921
Conversion of PBF LLC Series A Units (4)
1,206,326
 3,825,508
 2,184,690
 3,832,464
Common stock equivalents (5)
2,169,503
 332,137
 1,592,510
 324,157
Fully-converted shares outstanding-diluted120,405,315
 113,882,240
 117,375,170
 113,791,542
        
Diluted net income per share$1.50
 $2.85
 $4.16
 $1.57
Adjusted fully-converted net income per fully exchanged, fully diluted shares outstanding$1.50
 $2.85
 $4.16
 $1.57
Adjusted fully-converted net income excluding special items per fully exchanged, fully diluted shares outstanding$1.13
 $1.44
 $2.24
 $1.18
 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
 2019 2018 2019 2018
Net income (loss) attributable to PBF Energy Inc. stockholders$(32.2) $272.1
 $197.0
 $302.5
Less: Income allocated to participating securities0.1
 0.2
 0.2
 0.4
Income (loss) available to PBF Energy Inc. stockholders - basic(32.3) 271.9
 196.8
 302.1
Add: Net income (loss) attributable to noncontrolling interest (1)
(0.5) 6.1
 2.7
 7.4
Less: Income tax benefit (expense) (2)
0.1
 (1.5) (0.7) (1.9)
Adjusted fully-converted net income (loss)$(32.7) $276.5
 $198.8
 $307.6
Special Items: (3)
       
Add: Non-cash LCM inventory adjustment182.0
 (158.0) (324.0) (245.7)
Add: Recomputed income taxes on special items(48.2) 41.7
 85.7
 64.9
Adjusted fully-converted net income (loss) excluding special items$101.1
 $160.2
 $(39.5) $126.8
        
Weighted-average shares outstanding of PBF Energy Inc.119,181,845
 112,875,813
 119,885,386
 111,853,774
Conversion of PBF LLC Series A Units (4)
1,206,325
 1,838,196
 1,206,325
 2,681,980
Common stock equivalents (5)
1,501,569
 1,695,264
 928,733
 1,214,173
Fully-converted shares outstanding-diluted121,889,739
 116,409,273
 122,020,444
 115,749,927
        
Diluted net income (loss) per share$(0.27) $2.37
 $1.63
 $2.66
Adjusted fully-converted net income (loss) per fully exchanged, fully diluted shares outstanding (5)
$(0.27) $2.37
 $1.63
 $2.66
Adjusted fully-converted net income (loss) excluding special items per fully exchanged, fully diluted shares outstanding (3) (5)
$0.83
 $1.38
 $(0.33) $1.10
——————————
See Notes to Non-GAAP Financial Measures.

Gross Refining Margin and Gross Refining Margin Excluding Special Items
Gross refining margin is defined as consolidated gross margin excluding refinery depreciation, refinery operating expense, and gross margin of PBFX. We believe both gross refining margin and gross refining margin excluding special items are important measures of operating performance and provide useful information to

investors because they are helpful metric comparisons to the industry refining margin benchmarks, as the refining margin benchmarks do not include a charge for refinery operating expenses and depreciation. In order to assess our operating performance, we compare our gross refining margin (revenue less cost of products and other) to industry refining margin benchmarks and crude oil prices as defined in the table below.
Neither gross refining margin nor gross refining margin excluding special items should be considered an alternative to consolidated gross margin, income from operations, net cash flows from operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP. Gross refining margin and gross refining margin excluding special items presented by other companies may not be comparable to our presentation, since each company may define these terms differently. The following table presents our GAAP calculation of consolidated gross margin and a reconciliation of gross refining margin to the most directly comparable GAAP financial measure, consolidated gross margin, on a historical basis, as applicable, for each of the periods indicated (in thousands,millions, except per barrel amounts):


 Three Months Ended September 30,
 2018 2017
 $ per barrel of throughput $ per barrel of throughput
Calculation of consolidated gross margin:       
Revenues$7,646,360
 $93.56
 $5,478,951
 $70.09
Less: Cost of Sales7,331,158
 89.70
 4,830,832
 61.80
Consolidated gross margin$315,202
 $3.86
 $648,119
 $8.29
Reconciliation of consolidated gross margin to gross refining margin:       
Consolidated gross margin$315,202
 $3.86
 $648,119
 $8.29
Add: PBFX operating expense20,268
 0.25
 15,930
 0.20
Add: PBFX depreciation expense7,379
 0.09
 5,610
 0.08
Less: Revenues of PBFX(70,029) (0.86) (65,494) (0.84)
Add: Refinery operating expenses409,600
 5.01
 389,504
 4.98
Add: Refinery depreciation expense83,353
 1.02
 70,338
 0.90
Gross refining margin$765,773
 $9.37
 $1,064,007
 $13.61
Special items: (3)
       
Add: Non-cash LCM inventory adjustment(54,801) (0.67) (265,077) (3.39)
Add: Early railcar return expense44,571
 0.55
 —
 —
Gross refining margin excluding special items$755,543
 $9.25
 $798,930
 $10.22
——————————
See Notes to Non-GAAP Financial Measures.

 Three Months Ended June 30,
 2019 2018
 $ per barrel of throughput $ per barrel of throughput
Calculation of consolidated gross margin:       
Revenues$6,560.0
 $84.40
 $7,444.1
 $94.40
Less: Cost of sales6,493.2
 83.55
 6,959.9
 88.26
Consolidated gross margin$66.8
 $0.85
 $484.2
 $6.14
Reconciliation of consolidated gross margin to gross refining margin:       
Consolidated gross margin$66.8
 $0.85
 $484.2
 $6.14
Add: PBFX operating expense28.6
 0.37
 19.1
 0.24
Add: PBFX depreciation expense8.9
 0.11
 6.9
 0.08
Less: Revenues of PBFX(82.8) (1.07) (67.4) (0.85)
Add: Refinery operating expense409.7
 5.27
 402.7
 5.11
Add: Refinery depreciation expense95.3
 1.23
 82.8
 1.05
Gross refining margin$526.5
 $6.76
 $928.3
 $11.77
Special items:       
Add: Non-cash LCM inventory adjustment (3)
182.0
 2.34
 (158.0) (2.00)
Gross refining margin excluding special items$708.5
 $9.10
 $770.3
 $9.77

Nine Months Ended September 30,Six Months Ended June 30,
2018 20172019 2018
$ per barrel of throughput $ per barrel of throughput$ per barrel of throughput $ per barrel of throughput
Calculation of consolidated gross margin:              
Revenues$20,893,219
 $89.84
 $15,250,649
 $71.07
$11,776.2
 $81.44
 $13,246.9
 $87.83
Less: Cost of Sales19,932,646
 85.71
 14,619,200
 68.13
Less: Cost of sales11,284.4
 78.04
 12,601.4
 83.55
Consolidated gross margin$960,573
 $4.13
 $631,449
 $2.94
$491.8
 $3.40
 $645.5
 $4.28
Reconciliation of consolidated gross margin to gross refining margin:              
Consolidated gross margin$960,573
 $4.13
 $631,449
 $2.94
$491.8
 $3.40
 $645.5
 $4.28
Add: PBFX operating expense57,427
 0.25
 47,163
 0.22
58.5
 0.40
 37.1
 0.25
Add: PBFX depreciation expense20,793
 0.09
 16,562
 0.08
17.6
 0.12
 13.4
 0.09
Less: Revenues of PBFX(201,466) (0.87) (188,300) (0.88)(161.6) (1.12) (131.4) (0.87)
Add: Refinery operating expense1,223,798
 5.26
 1,224,757
 5.71
863.1
 5.97
 814.1
 5.40
Add: Refinery depreciation242,960
 1.04
 181,238
 0.84
Add: Refinery depreciation expense189.6
 1.31
 159.6
 1.05
Gross refining margin$2,304,085
 $9.90
 $1,912,869
 $8.91
$1,459.0
 $10.08
 $1,538.3
 $10.20
Special items:(3)
              
Add: Non-cash LCM inventory adjustment(300,456) (1.29) (97,943) (0.45)(324.0) (2.23) (245.7) (1.63)
Add: Early railcar return expense44,571
 0.19
 —
 —
Gross refining margin excluding special items$2,048,200
 $8.80
 $1,814,926
 $8.46
$1,135.0
 $7.85
 $1,292.6
 $8.57
——————————
See Notes to Non-GAAP Financial Measures.
EBITDA, EBITDA Excluding Special Items and Adjusted EBITDA
Our management uses EBITDA (earnings before interest, income taxes, depreciation and amortization), EBITDA excluding special items and Adjusted EBITDA as measures of operating performance to assist in comparing performance from period to period on a consistent basis and to readily view operating trends, as a measure for planning and forecasting overall expectations and for evaluating actual results against such expectations, and in communications with our board of directors, creditors, analysts and investors concerning our financial performance. Our outstanding indebtedness for borrowed money and other contractual obligations also include similar measures as a basis for certain covenants under those agreements which may differ from the Adjusted EBITDA definition described below.
EBITDA, EBITDA excluding special items and Adjusted EBITDA are not presentations made in accordance with GAAP and our computation of EBITDA, EBITDA excluding special items and Adjusted EBITDA may vary from others in our industry. In addition, Adjusted EBITDA contains some, but not all, adjustments that are taken into account in the calculation of the components of various covenants in the agreements governing our senior notes and other credit facilities. EBITDA, EBITDA excluding special items and Adjusted EBITDA should not be considered as alternatives to income from operations or net income as measures of operating performance. In addition, EBITDA, EBITDA excluding special items and Adjusted EBITDA are not presented as, and should not be considered, an alternative to cash flows from operations as a measure of liquidity. Adjusted EBITDA is defined as EBITDA before adjustments for items such as stock-based compensation expense, the non-cash change in the fair value of catalyst leases, the write down of inventory to the LCM, changes in the liability for Tax Receivable Agreement due to factors out of ourPBF Energy’s control such as changes in tax rates, debt extinguishment costs related to refinancing activities, and certain other non-cash items. Other companies, including other companies in our industry, may calculate EBITDA, EBITDA excluding special items and Adjusted EBITDA differently than we do, limiting

their usefulness as comparative measures. EBITDA, EBITDA excluding special items and Adjusted EBITDA also have limitations as analytical tools and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations include that EBITDA, EBITDA excluding special items and Adjusted EBITDA:

do not reflect depreciation expense or our cash expenditures, or future requirements, for capital expenditures or contractual commitments;
do not reflect changes in, or cash requirements for, our working capital needs;
do not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our debt;
do not reflect realized and unrealized gains and losses from certain hedging activities, which may have a substantial impact on our cash flow;
do not reflect certain other non-cash income and expenses; and
exclude income taxes that may represent a reduction in available cash.
The following tables reconcile net income as reflected in PBF Energy’s results of operations to EBITDA, EBITDA excluding special items and Adjusted EBITDA for the periods presented (in thousands)millions):
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,		 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
  
 2018 2017 2018 2017 2019 2018 2019 2018
Reconciliation of net income to EBITDA and EBITDA excluding special items:       
Net income$192,466
 $347,226
 $521,964
 $223,045
Reconciliation of net income (loss) to EBITDA and EBITDA excluding special items:Reconciliation of net income (loss) to EBITDA and EBITDA excluding special items:       
Net income (loss)Net income (loss)$(21.6) $287.7
 $219.8
 $329.5
Add: Depreciation and amortization expenseAdd: Depreciation and amortization expense93,326
 78,520
 271,624
 208,155
Add: Depreciation and amortization expense107.1
 92.3
 212.9
 178.3
Add: Interest expense, netAdd: Interest expense, net42,289
 36,990
 128,935
 114,871
Add: Interest expense, net42.1
 43.4
 81.6
 86.6
Add: Income tax expense61,349
 203,979
 167,836
 112,889
Add: Income tax (benefit) expenseAdd: Income tax (benefit) expense(10.5) 95.5
 70.0
 106.5
EBITDAEBITDA$389,430
 $666,715
 $1,090,359
 $658,960
EBITDA$117.1
 $518.9
 $584.3
 $700.9
Special Items(3)
Special Items(3)
       
Special Items(3)
       
Add: Non-cash LCM inventory adjustmentAdd: Non-cash LCM inventory adjustment(54,801) (265,077) (300,456) (97,943)Add: Non-cash LCM inventory adjustment182.0
 (158.0) (324.0) (245.7)
Add: Change in Tax Receivable Agreement liability(7,763) (565) (7,763) (565)
Add: Debt extinguishment costs—
 —
 —
 25,451
Add: Gain on Torrance land sale(43,761) —
 (43,761) —
Add: Early railcar return expense44,571
 —
 44,571
 —
EBITDA excluding special itemsEBITDA excluding special items$327,676
 $401,073
 $782,950
 $585,903
EBITDA excluding special items$299.1
 $360.9
 $260.3
 $455.2
                
Reconciliation of EBITDA to Adjusted EBITDA:Reconciliation of EBITDA to Adjusted EBITDA:       Reconciliation of EBITDA to Adjusted EBITDA:       
EBITDAEBITDA$389,430
 $666,715
 $1,090,359
 $658,960
EBITDA$117.1
 $518.9
 $584.3
 $700.9
Add: Stock-based compensationAdd: Stock-based compensation5,591
 4,222
 18,608
 18,064
Add: Stock-based compensation12.0
 7.9
 20.0
 13.0
Add: Net non-cash change in fair value of catalyst leasesAdd: Net non-cash change in fair value of catalyst leases(1,630) (473) (5,783) 1,011
Add: Net non-cash change in fair value of catalyst leases(0.5) (4.1) 2.6
 (4.1)
Add: Non-cash LCM inventory adjustment (3)
Add: Non-cash LCM inventory adjustment (3)
(54,801) (265,077) (300,456) (97,943)
Add: Non-cash LCM inventory adjustment (3)
182.0
 (158.0) (324.0) (245.7)
Add: Change in Tax Receivable Agreement liability(3)
(7,763) (565) (7,763) (565)
Add: Debt extinguishment costs (3)
—
 —
 —
 25,451
Adjusted EBITDAAdjusted EBITDA$330,827
 $404,822
 $794,965
 $604,978
Adjusted EBITDA$310.6
 $364.7
 $282.9
 $464.1
——————————
See Notes to Non-GAAP Financial Measures.

Notes to Non-GAAP Financial Measures
The following notes are applicable to the Non-GAAP Financial Measures above:
(1)Represents the elimination of the noncontrolling interest associated with the ownership by the members of PBF LLC other than PBF Energy, as if such members had fully exchanged their PBF LLC Series A Units for shares of PBF Energy’s Class A common stock.
(2)Represents an adjustment to reflect PBF Energy’s estimated annualized statutory corporate tax rate of approximately 26.4%26.5% and 39.4%26.4% for the 20182019 and 20172018 periods, respectively, applied to net income attributable to noncontrolling interest for all periods presented. The adjustment assumes the full exchange of existing PBF LLC Series A Units as described in (1) above. Our statutory tax rates were reduced in 2018 as a result of the TCJA enactment.
(3)Special items:
LCM inventory adjustment - LCM is a GAAP guidelinerequirement related to inventory valuation that requiresmandates inventory to be stated at the lower of cost or market. Our inventories are stated at the lower of cost or market. Cost is determined using the last-in, first-out (“LIFO”) inventory valuation methodology, in which the most recently incurred costs are charged to cost of sales and inventories are valued at base layer acquisition costs. Market is determined based on an assessment of the current estimated replacement cost and net realizable selling price of the inventory. In periods where the market price of our inventory declines substantially, cost values of inventory may exceed market values. In such instances, we record an adjustment to write down the value of inventory to market value in accordance with GAAP. In subsequent periods, the value of inventory is reassessed and an LCM inventory adjustment is recorded to reflect the net change in the LCM inventory reserve between the prior period and the current period. The net impact of these LCM inventory adjustments are included in the Refining segment’s operating income from operations, but are excluded from the operating results presented in the table below in order to make such information comparable between periods.
The following table includes the lower of cost or marketLCM inventory reserve as of each date presented (in thousands)millions):
2018 20172019 2018
January 1,$300,456
 $595,988
$651.8
 $300.5
March 31,145.8
 212.8
June 30,54,801
 763,122
327.8
 54.8
September 30,—
 498,045
The following table includes the corresponding impact of changes in the LCM inventory reserve on income from operations and net income (loss) for the periods presented (in thousands)millions):
 Three Months Ended 
 September 30,		 Nine Months Ended 
 September 30,
  
 2018 2017 2018 2017
Net LCM inventory adjustment benefit in income from operations$54,801
 $265,077
 $300,456
 $97,943
Net LCM inventory adjustment benefit in net income40,328
 160,743
 221,106
 59,393
 Three Months Ended 
 June 30,		 Six Months Ended 
 June 30,
  
 2019 2018 2019 2018
Net LCM inventory adjustment (charge) benefit in income from operations$(182.0) $158.0
 $324.0
 $245.7
Net LCM inventory adjustment (charge) benefit in net income (loss)(133.8) 116.3
 238.3
 180.8
Change in Tax Receivable Agreement liability - During the three and nine months ended September 30, 2018 we recorded a change in the Tax Receivable Agreement liability that increased income before income taxes and net income by $7.8 million and $5.7 million, respectively. During the three and nine months ended September 30, 2017 we recorded a change in the Tax Receivable Agreement liability that increased income before income taxes and net income by $0.6 million and $0.3 million, respectively. The changes in the Tax

Receivable Agreement liability reflect charges or benefits attributable to changes in our obligation under the Tax Receivable Agreement due to factors out of our control such as changes in tax rates.
Debt Extinguishment Costs - During the nine months ended September 30, 2017, we recorded pre-tax debt extinguishment costs of $25.5 million related to the redemption of the 2020 Senior Secured Notes. These nonrecurring charges decreased net income by $15.4 million for the nine months ended September 30, 2017. There were no such costs in the same periods of 2018.
Early Return of Railcars - During the three and nine months ended September 30, 2018 we recognized certain expenses within Cost of sales associated with the voluntary early return of certain leased railcars. These charges decreased income from operations and net income by $44.6 million and $32.8 million, respectively. There were no such expenses in the same periods of 2017.
Gain on Torrance land sale - During the three and nine months ended September 30, 2018 we recorded a gain on the sale of a parcel of real property acquired as part of the Torrance refinery, but not part of the refinery itself. The gain increased income from operations and net income by $43.8 million and $32.2 million, respectively. There was no such gain in the same periods of 2017.
Recomputed Income taxes on special items - The income tax impact of theon special items wereis calculated using the tax rates shown in (2) above.
(4)Represents an adjustment to weighted-average diluted shares outstanding to assume the full exchange of existing PBF LLC Series A Units as described in (1) above.
(5)Represents weighted-average diluted shares outstanding assuming the conversion of all common stock equivalents, including options and warrants for PBF LLC Series A Units and performance share units and options for shares of PBF Energy Class A common stock as calculated under the treasury stock method (to the extent the impact of such exchange would not be anti-dilutive) for the three and ninesix months ended SeptemberJune 30, 20182019 and 2017,2018, respectively. Common stock equivalents exclude the effects of options, warrants and warrantsperformance share units to purchase 15,0006,833,973 and 25,0006,012,867 shares of PBF Energy Class A common stock and PBF LLC Series A Units because they are anti-dilutive for the three and nine month periodssix months ended SeptemberJune 30, 2018,2019, respectively. Common stock equivalents exclude the effects of options and warrants to purchase 6,484,65012,500 and 6,554,650233,250 shares of PBF Energy Class A common stock and PBF LLC Series A Units because they are anti-dilutive for the three and nine monthsix months ended June 30, 2018, respectively. For periods ended September 30, 2017, respectively.showing a net loss, all common stock equivalents and unvested restricted stock are considered anti-dilutive.

Liquidity and Capital Resources
Overview
Our primary sources of liquidity are our cash flows from operations and borrowing availability under our credit facilities, as more fully described below. We believe that our cash flows from operations and available capital resources will be sufficient to meet our and our subsidiaries’subsidiaries capital expenditure, working capital needs, dividend payment,payments, debt service requirements, and share repurchase program requirements, as well as ourPBF Energy’s obligations under the Tax Receivable Agreement, for the next twelve months.months, as well as to fund the pending Martinez Acquisition. However, our ability to generate sufficient cash flow from operations depends, in part, on petroleum oil market pricing and general economic, political and other factors beyond our control. We are in compliance as of SeptemberJune 30, 20182019 with all of the covenants, including financial covenants, in all of our debt agreements.
Cash Flow Analysis
The below cash flow analysis includes details by cash flow activity based on the results of PBF Energy. Material changes that exist between the PBF Energy and PBF LLC cash flowflows are explained thereafter.
Cash Flows from Operating Activities
Net cash provided byused in operating activities was $720.3$27.4 million for the ninesix months ended SeptemberJune 30, 20182019 compared to net cash provided by operating activities of $322.2$307.9 million for the ninesix months ended SeptemberJune 30,

2017. 2018. Our operating cash flows for the ninesix months ended SeptemberJune 30, 20182019 included our net income of $522.0$219.8 million, depreciation and amortization of $277.7$218.4 million, deferred income taxes of $167.0$68.2 million, pension and other post-retirement benefits costs of $35.5$22.4 million, net non-cash charges relating to the change in the fair value of our inventory repurchase obligations of $10.7$35.0 million, stock-based compensation of $18.6$20.0 million, partially offset by a gain on sale of assets of $43.1 million, a net non-cash benefit of $300.5 million relating to an LCM inventory adjustment, change in the Tax Receivable Agreement liability of $7.8 million and changes in the fair value of our catalyst leases of $5.8 million.$2.6 million and loss on sale of assets of $0.8 million, partially offset by a net non-cash benefit of $324.0 million relating to an LCM inventory adjustment. In addition, net changes in operating assets and liabilities reflected cash proceedsuses of $45.9$290.6 million driven by the timing of inventory purchases, payments for accrued expenses and accounts payables and collections of accounts receivables. Our operating cash flows for the ninesix months ended SeptemberJune 30, 20172018 included our net income of $223.0$329.5 million, depreciation and amortization of $215.1$182.3 million, deferred income taxes of $111.3$105.7 million, pension and other post-retirement benefits costs of $31.7$23.7 million, stock-based compensation of $18.1 million, changes in the fair value of our catalyst leases of $1.0 million, debt extinguishment costs related to the refinancing of our 2020 Senior Secured Notes of $25.5 million, and a loss on sale of assets of $0.9 million, partially offset by a net non-cash benefit of $97.9 million relating to an LCM inventory adjustment, net non-cash charges relating to the change in the fair value of our inventory repurchase obligations of $26.7$2.5 million, stock-based compensation of $13.0 million, and changea loss on sale of assets of $0.7 million, partially offset by a net non-cash benefit of $245.7 million relating to an LCM inventory adjustment and changes in the Tax Receivable Agreement liabilityfair value of $0.6our catalyst leases of $4.1 million. In addition, net changes in operating assets and liabilities reflected uses of cash of $179.2$99.7 million driven by the timing of inventory purchases, payments for accrued expenses and accounts payables and collections of accounts receivables.
Cash Flows from Investing Activities
Net cash used in investing activities was $419.8$501.9 million for the ninesix months ended SeptemberJune 30, 20182019 compared to net cash used in investing activities of $609.9$365.2 million for the ninesix months ended SeptemberJune 30, 2017.2018. The net cash flows used in investing activities for the ninesix months ended SeptemberJune 30, 20182019 was comprised of cash outflows of $192.2$206.1 million for capital expenditures, expenditures for refinery turnarounds of $201.0$261.9 million, and expenditures for other assets of $16.9 million and expenditures for the acquisition of the Knoxville Terminals by PBFX of $58.0 million, partially offset by proceeds of $48.3 million related to the Torrance land sale.$33.9 million. Net cash used in investing activities for the ninesix months ended SeptemberJune 30, 20172018 was comprised of cash outflows of $267.2$115.7 million for capital expenditures, expenditures for refinery turnarounds of $341.6$179.2 million, expenditures for other assets of $31.1$12.3 million and expenditures for the acquisition of the Toledo Products TerminalKnoxville Terminals by PBFX of $10.1 million, partially offset by $40.0 million of net maturities of marketable securities.$58.0 million.

Cash Flows from Financing Activities
Net cash provided by financing activities was $185.7$136.1 million for the ninesix months ended SeptemberJune 30, 20182019 compared to net cash used in financing activities of $157.7$37.4 million for the ninesix months ended SeptemberJune 30, 2017.2018. For the ninesix months ended SeptemberJune 30, 2018,2019, net cash provided by financing activities consisted primarily of $287.3 million in net proceeds from the August 2018 Equity Offering, $34.8$132.5 million in net proceeds from the issuance of PBFX common units, net borrowings from the PBFX Revolving Credit Facility of $20.3$95.0 million, proceeds from insurance premium financing of $18.9 million, and proceeds from stock options exercised of $14.0 million and proceeds from insurance premium financing of $7.0$0.2 million, partially offset by distributions and dividends of $140.2$103.3 million, principal amortization payments of the PBF Rail Term Loan of $5.1$3.5 million, repaymentdeferred financing costs and other of note payable of $5.6$1.1 million, net settlements of precious metals catalyst leases of $9.5 million, deferred financing costs of $15.9$1.2 million, and repurchases of our common stock in connection with tax withholding obligations upon the vesting of certain restricted stock awards of $1.4 million. ForAdditionally, during the ninesix months ended SeptemberJune 30, 2017,2019, we borrowed and repaid $1,250.0 million under our Revolving Credit Facility resulting in no net change to amounts outstanding for the six months ended June 30, 2019. Forthe six months ended June 30, 2018, net cash used in financing activities consisted of distributions and dividends of $134.4 million, repayments of the PBFX Term Loan of $39.7$91.5 million, principal amortization payments of the PBF Rail Term Loan of $5.0$3.4 million, repayment of note payable of $2.4 million, net settlements of precious metals catalyst leases of $9.5 million, deferred financing costs of $13.0 million and repurchases of our common stock in connection with tax withholding obligations upon the vesting of certain restricted stock awards of $1.0 million, partially offset by net cashborrowings under the PBFX Revolving Credit Facility of $54.3 million, proceeds from insurance premium financing of $21.4$17.4 million and proceeds from the issuancestock options exercised of the 2025 Senior Notes net of cash paid to redeem the 2020 Senior Secured Notes and related issuance costs. Additionally, during the nine months ended September 30, 2017, we borrowed and repaid $490.0 million under our Revolving Loan resulting in no net change to amounts outstanding for the nine months ended September 30, 2017.$11.7 million.
The cash flow activity of PBF LLC for the period ended SeptemberJune 30, 20182019 is materially consistent with that of PBF Energy discussed above, other than changes in deferred income taxes and certain working capital

items, which are different from PBF Energy due to certain tax related items not applicable to PBF LLC. Additionally, the PBF LLC reflects net proceeds from ancash flows reflect repayments of the affiliate loannote payable with PBF Energy of $44.2$0.8 million included in cash flows from financing activities, which eliminates in consolidation at PBF Energy.
The cash flow activity of PBF LLC for the period ended SeptemberJune 30, 20172018 is materially consistent with that of PBF Energy discussed above, other than changechanges in deferred income taxes and certain working capital items, which are different from PBF Energy due to certain tax related items not applicable to PBF LLC. Additionally, the PBF LLC reflectscash flows reflect net proceeds from anthe affiliate loannote payable with PBF Energy of $99.7$40.3 million included in cash flows from financing activities, which eliminates in consolidation at PBF Energy.
Credit Facilities
PBF Holding Revolving Credit Facility
On May 2, 2018, PBF Holding and certain of our wholly-owned subsidiaries, as borrowers or subsidiary guarantors, replaced our existing asset-based revolving credit agreement dated as of August 15, 2014 (the “August 2014 Revolving Credit Agreement”) with a new asset-based revolving credit agreement (the “2018 Revolving Credit Agreement”). Among other things, the 2018 Revolving Credit Agreement increases the maximum commitment available to us from $2.6 billion to $3.4 billion, extends the maturity date to May 2023, and redefines certain components of the Borrowing Base (as defined in the credit agreement) to make more funding available for working capital and other general corporate purposes. Borrowings under the 2018 Revolving Credit Agreement bear interest at the Alternative Base Rate plus the Applicable Margin or at the Adjusted LIBOR Rate plus the Applicable Margin, all as defined in the credit agreement and further described in “Note 7 - Debt” of our Notes to Condensed Consolidated Financial Statements.
The 2018 Revolving Credit Agreement contains customary covenants and restrictions on the activities of PBF Holding and its subsidiaries, including, but not limited to, limitations on the incurrence of additional indebtedness, liens, negative pledges, guarantees, investments, loans, asset sales, mergers, acquisitions and prepayment of other debt, distributions, dividends and the repurchase of capital stock, transactions with affiliates and the ability of PBF Holding to change the nature of its business or its fiscal year; all as defined in the credit agreement.
In addition, the 2018 Revolving Credit Agreement has a financial covenant which requires that if at any time Excess Availability, as defined in the credit agreement, is less than the greater of (i) 10% of the lesser of the then existing Borrowing Base and the then aggregate Revolving Commitments of the Lenders (the “Financial Covenant Testing Amount”), and (ii) $100.0 million, and until such time as Excess Availability is greater than the Financial Covenant Testing Amount and $100.0 million for a period of 12 or more consecutive days, PBF Holding will not permit the Consolidated Fixed Charge Coverage Ratio, as defined in the credit agreement and determined as of the last day of the most recently completed quarter, to be less than 1.0 to 1.0.
PBF Holding’s obligations under the 2018 Revolving Credit Agreement are (a) guaranteed by each of its domestic operating subsidiaries that are not Excluded Subsidiaries (as defined in the credit agreement) and (b) secured by a lien on (i) PBF LLC’s equity interest in PBF Holding and (ii) certain assets of PBF Holding and the subsidiary guarantors, including all deposit accounts (other than zero balance accounts, cash collateral accounts, trust accounts and/or payroll accounts, all of which are excluded from the collateral), all accounts receivable, all hydrocarbon inventory (other than the intermediate and finished products owned by J. Aron pursuant to the Inventory Intermediation Agreements) and to the extent evidencing, governing, securing or otherwise related to the foregoing, all general intangibles, chattel paper, instruments, documents, letter of credit rights and supporting obligations; and all products and proceeds of the foregoing.
PBFX Revolving Credit Facility
On July 30, 2018, PBFX entered into the PBFX Revolving Credit Facility. The PBFX Revolving Credit Facility amended and restated the existing PBFX revolving credit facility entered into in connection with the closing of the PBFX IPO. Among other things, the PBFX Revolving Credit Facility increasesincreased the maximum commitment available to PBFX from $360.0 million to $500.0 million, and extendsextended the maturity date to July 2023. PBFX has the ability to further increase the maximum

availability by an additional $250.0 million to a total facility sizecommitment of $750.0 million, subject to receiving increased commitments from lenders or other financial institutions and satisfaction of certain conditions. Borrowings under the PBFX Revolving Credit Facility bear interest either at the Alternative Base Rate plus the Applicable Margin or at LIBOR Rate plus the Applicable Margin, all as defined in the PBFX Revolving Credit AgreementAgreement.

PBF Holding Revolving Credit Facility
On May 2, 2018, PBF Holding and further described in “Note 7 - Debt”certain of our Notes to Condensed Consolidated Financial Statements.
The PBFXwholly-owned subsidiaries, as borrowers or subsidiary guarantors, replaced the August 2014 Revolving Credit Agreement with the Revolving Credit Facility. Among other things, the Revolving Credit Facility contains affirmativeincreased the maximum commitment available to us from $2.6 billion to $3.4 billion, extended the maturity date to May 2023, and negative covenants customary for revolving credit facilitiesredefined certain components of this nature which, among other things, limit or restrict PBFX’s ability and the ability of its restricted subsidiaries to incur or guarantee debt, incur liens, make investments, make restricted payments, amend material contracts, engage in certain business activities, engage in mergers, consolidations and other organizational changes, sell, transfer or otherwise dispose of assets, enter into burdensome agreements, or enter into transactions with affiliates on terms which are not at arm’s length.
Additionally, commencing with the Measurement PeriodBorrowing Base (as defined in the PBFX Amended and Restated Revolving Credit Agreement) ending September 30, 2018, PBFX will be required to maintainmake more funding available for working capital and other general corporate purposes. Borrowings under the following financial ratios, eachRevolving Credit Facility bear interest at the Alternative Base Rate plus the Applicable Margin or at the Adjusted LIBOR Rate plus the Applicable Margin, all as defined in the PBFX Amended and Restated Revolving Credit Agreement: (a) Consolidated Interest CoverageAgreement. In addition, an accordion feature allows for commitments of at least 2.50up to 1.00, (b) Consolidated Total Leverage of not greater than 4.50 to 1.00 and (c) Consolidated Senior Secured Leverage of not greater than 3.50 to 1.00.
The PBFX Revolving Credit Facility contains events of default customary for transactions of their nature, including, but not limited to (and subject to grace periods in certain circumstances), the failure to pay any principal, interest or fees when due, failure to perform or observe any covenant contained in the PBFX Revolving Credit Facility or related documentation, any representation or warranty made in the agreements or related documentation being untrue in any material respect when made, default under certain material debt agreements, commencement of bankruptcy or other insolvency proceedings, certain changes in PBFX’s ownership or the ownership or board composition of PBF GP and material judgments or orders. Upon the occurrence and during the continuation of an event of default under the agreements, the lenders may, among other things, terminate their commitments, declare any outstanding loans to be immediately due and payable and/or exercise remedies against PBFX and the collateral as may be available to the lenders under the agreements and related documentation or applicable law.
On April 16, 2018, PBFX completed the Knoxville Terminals Purchase for total cash consideration of $58.0 million, excluding working capital adjustments, which was primarily financed through borrowings under the PBFX Revolving Credit Facility.$3.5 billion.
Liquidity
As of SeptemberJune 30, 2018,2019, our total liquidity was approximately $2,237.1$1,802.6 million, compared to total liquidity of approximately $1,442.0$1,677.4 million as of December 31, 2017.2018. Our total liquidity is equal to the amount of excess availability under the 2018 Revolving Credit Agreement,Facility, which includes our cash balance at SeptemberJune 30, 2018.2019. In addition, as of SeptemberJune 30, 2018,2019 PBFX had approximately $446.0$244.9 million of borrowing capacity under the PBFX Revolving Credit Facility in comparison to $336.0$340.0 million as of December 31, 2017.2018. The PBFX Revolving Credit Facility is available to fund working capital, acquisitions, distributions, capital expenditures and for other general corporate purposes incurred by PBFX.
Working Capital
PBF Energy’s working capital at SeptemberJune 30, 20182019 was $2,101.0$1,201.2 million, consisting of $4,749.6$3,599.0 million in total current assets and $2,648.7$2,397.8 million in total current liabilities. PBF Energy’s working capital at December 31, 20172018 was $1,384.0$1,102.4 million, consisting of $3,803.0$3,236.9 million in total current assets and $2,418.9$2,134.5 million in total current liabilities. PBF LLC’s working capital at SeptemberJune 30, 20182019 was $2,082.6$1,177.6 million, consisting of $4,747.7$3,598.6 million in total current assets and $2,665.1$2,421.0 million in total current liabilities. PBF LLC’s working capital at December 31, 20172018 was $1,351.7$1,081.5 million, consisting of $3,780.2$3,235.1 million in total current assets and $2,428.5$2,153.6 million in total current liabilities.

Working capital has increased during the ninesix months ended SeptemberJune 30, 20182019 primarily as a result of positive earnings, proceeds from the August 2018 Equity Offering, proceeds from the PBFX Registered Direct Offering, and proceeds from the Torrance land sale,change in our LCM inventory adjustment, partially offset by capital expenditures, including turnaround costs.costs, and dividends and distributions.
Capital Spending
Net capitalCapital spending was $468.1$501.9 million for the ninesix months ended SeptemberJune 30, 2018,2019, which primarily included turnaround costs at our Torrance, Delaware City and Paulsboro refineries, safety related enhancements and facility improvements at the refineries and the PBFX Knoxville Terminals Purchase. Excluding PBFX, weour refineries. We currently expect to spend an aggregate of approximately $525.0$625.0 million to $550.0$675.0 million in net capital expenditures during 2019, excluding PBFX and any potential capital expenditures related to the full year 2018pending Martinez Acquisition, for facility improvements and refinery maintenance and turnarounds.turnarounds, the majority of which were incurred during the first six months of 2019. Significant capital spending for the full year 2018,2019, excluding PBFX, includes turnarounds forof the FCC and alkylation unitscoker at our ChalmetteTorrance refinery, the coker at our PaulsboroDelaware City refinery and several unitsthe crude unit at our Toledo and Delaware City refineries,Paulsboro refinery, as well as expenditures to meet environmental and regulatory requirements. Capital spending plans also include strategic capital expenditures for the restart of the idled Chalmette refinery coker and the Delaware City refinery hydrogen plant. In addition, PBFX expects to spend an aggregate of approximately $50.0$30.0 million to $55.0$35.0 million in net capital expenditures during 2019.

As noted in "Business Developments", we entered into a Sale and Purchase Agreement to purchase the full year 2018, excluding acquisitions.
On October 1, 2018, PBFX closedMartinez refinery and related logistics assets. The aggregate purchase price for the Martinez Acquisition will range from $900.0 million to $1.0 billion in cash, based on its acquisitionclosing date, plus inventory and working capital to be valued at closing. In addition, PBF Holding also has an obligation to make certain post-closing payments to the Seller if certain conditions are met including earn-out payments based on certain earnings thresholds of CPI Operations LLC (the “East Coast Storage Assets Acquisition”)the Martinez refinery, as defined in the Sale and Purchase Agreement, for total consideration of $107.0 million, comprised of an initial payment at closing of $75.0 million witha period up to four years following the balance being payable one year after closing. The initial payment made atpurchase price is also subject to other customary purchase price adjustments. The Martinez Acquisition is expected to close in the fourth quarter of 2019, subject to satisfaction of customary closing for this acquisition was financedconditions, including the absence of legal impediments prohibiting the Martinez Acquisition, receipt of regulatory approvals and required consents and absence of any material adverse effects. We expect to finance the transaction through a combination of cash on hand including the proceeds from the Registered Direct Offering, and borrowings under our Revolving Credit Facility.

Share Repurchases
Our Board of Directors previously authorized the repurchase of up to $300.0 million of our Class A common stock (as amended from time to time, the “Repurchase Program”). As of September 30, 2018, we have purchased approximately 6,050,717 shares of our Class A common stock under the Repurchase Program for $150.8 million through open market transactions. No repurchases of our Class A common stock were made during the three months ended September 30, 2018. The Repurchase Program expired on September 30, 2018 and was not renewed.debt.
Crude and Feedstock Supply Agreements
Certain of our purchases of crude oil under our agreements with foreign national oil companies require that we post letters of credit and arrange for shipment. We pay for the crude when invoiced, at which time the letters of credit are lifted. OurWe have a contract with Saudi Aramco pursuant to which we have been purchasing up to approximately 100,000 bpd of crude and feedstock supply agreementsoil from Saudi Aramco that is processed at our Paulsboro refinery. In connection with the Chalmette Acquisition we entered into a contract with PDVSA provide thatfor the supply of 40,000 to 60,000 bpd of crude oil that can be processed at any of our East andor Gulf Coast refineries. We have not sourced crude oil under this arrangementagreement since the third quarter of 2017 aswhen PDVSA has suspended deliveries due to the parties’ inability to agree to mutually acceptable payment terms. Notwithstanding the suspension, the recent U. S. sanctions imposed against PDVSA and Venezuela would prevent us from purchasing crude oil under this agreement. In connection with the closing of the Torrance Acquisition, we entered into a crude supply agreement with ExxonMobil for approximately 60,000 bpd of crude oil that can be processed at our Torrance refinery. We currently purchase all of our crude and feedstock needs independently from a variety of suppliers on the spot market or through term agreements for our Delaware City and Toledo refineries.
Inventory Intermediation Agreements
On May 4, 2017 and September 8, 2017,March 29, 2019, PBF Holding and its subsidiaries, DCR and PRC, entered into amendments to the Inventory Intermediation Agreements with J. Aron, pursuant to which certain terms of the existing inventory intermediation agreements were amended, including, among other things, pricing and an extension of the terms. As a result of the amendments (i) the Inventory Intermediation Agreement by and among J. Aron, PBF Holding and PRCDCR relating to the PaulsboroDelaware refinery extendsextended the term to December 31, 2019,February 28, 2020, which term may be further extended by mutual consent of the parties to December 31, 2020February 26, 2021 and (ii) added the Inventory Intermediation Agreement by and amongPBFX East Coast Storage Facility as a location which will sell crude oil, a new product type to be included in the Products, to J. Aron PBF Holding and DCR relating to the Delaware City refinery extends the term to July 1, 2019, which term may be further extended by mutual consent of the parties to July 1, 2020.DCR.
Pursuant to each Inventory Intermediation Agreement, J. Aron continues to purchase and hold title to certain of the intermediate and finished products (the “Products”)Products produced by the Paulsboro and Delaware City refineries

(the “Refineries”), respectively,Refineries, and delivered into tanks at the Refineries.Storage Tanks. Furthermore, J. Aron agrees to sell the Products back to the Refineries as the Products are discharged out of the Refineries’ tanks.Storage Tanks. J. Aron has the right to store the Products purchased in tanks under the Inventory Intermediation Agreements and will retain these storage rights for the term of the agreements. PBF Holding continues to market and sell independently to third parties.
At SeptemberJune 30, 2018,2019, the LIFO value of crude oil, intermediates and finished products owned by J. Aron included within inventory onInventory in our balance sheetCondensed Consolidated Balance Sheets was $339.1$450.1 million. We accrue a corresponding liability for such intermediates and finished products.
Off-Balance Sheet Arrangements and Contractual Obligations and Commitments
We have no off-balance sheet arrangements as of SeptemberJune 30, 2018,2019, other than outstanding letters of credit in the amount of approximately $682.6 million and operating leases.$283.7 million.

Tax Receivable Agreement Obligations
We expect that the payments that we may make under the Tax Receivable Agreement will be substantial. As of SeptemberJune 30, 2018, we have2019, PBF Energy has recognized a liability for the Tax Receivable Agreement of $381.3$373.5 million reflecting our estimate of the undiscounted amounts that we expect to pay under the agreement due to exchanges of PBF LLC Series A Units for shares of PBF Energy’s Class A common stock that occurred prior to that date, and to range over the next five years from approximately $30.0 million to $65.0 million per year and decline thereafter. In addition, under certain circumstances, our obligations under the Tax Receivable Agreement may be accelerated and determined based on certain assumptions set forth therein. Assuming that the market value of a share of our Class A common stock equals $49.91$31.30 per share (the closing price on SeptemberJune 30, 2018)2019) and that LIBOR were to be 1.85%, we estimate as of SeptemberJune 30, 20182019 that the aggregate amount of these accelerated payments would have been approximately $339.5$327.2 million if triggered immediately on such date. These payment obligations are obligations of PBF Energy and not of PBF LLC or any of its subsidiaries including PBF Holding or PBFX. However, because PBF Energy is a holding company with no operations of its own, PBF Energy’s ability to make payments under the Tax Receivable Agreement is dependent upon a number of factors, including its subsidiaries’ ability to make distributions for the benefit of PBF LLC’s members, including PBF Energy, its ability, if necessary, to finance its obligations under the Tax Receivable Agreement and existing indebtedness which may limit PBF Energy’s subsidiaries’ ability to make distributions.
Future payments under the Tax Receivable Agreement by us in respect of subsequent exchanges of PBF LLC Series A Units for shares of PBF Energy’sEnergy Class A common stock would be in addition to the amounts above and are expected to be substantial. The foregoing numbers are merely estimates - the actual payments could differ materially and assume that there are no material changes in the relevant tax law, and that we earn sufficient taxable income to realize all tax benefits that are subject to the Tax Receivable Agreement. It is possible that future transactions or events could increase or decrease the actual tax benefits realized and the corresponding Tax Receivable Agreement payments.
Dividend and Distribution Policy
PBF Energy
With respect to dividends and distributions paid during the ninesix months ended SeptemberJune 30, 2018,2019, PBF LLC made aggregate non-tax quarterly distributions of $104.7$72.7 million, or $0.30 per unit to its members, of which $103.0$71.9 million was distributed pro-rata to PBF Energy and the balance was distributed to its other members. PBF Energy used this $103.0$71.9 million to pay quarterly cash dividends of $0.30 per share of Class A common stock on both March 14, 2018,2019 and May 30, 2018 and August2019. In addition, during the six months ended June 30, 2018.2019, PBF LLC made aggregate tax distributions to its members of $54.8 million, of which $53.2 million was made to PBF Energy.
On October 31, 2018,August 1, 2019, PBF Energy announced a dividend of $0.30 per share on outstanding PBF Energy Class A common stock. The dividend is payable on NovemberAugust 30, 20182019 to PBF Energy Class A common stockholders of record at the close of business on NovemberAugust 15, 2018.2019. PBF LLC intends to make pro-rata distributions of approximately $36.3 million,

or $0.30 per unit to its members, including PBF Energy. PBF Energy, will thenwhich in turn, intends to use this distribution to fund the dividend payments to the shareholders of PBF Energy.
PBF Energy currently intends to continue to pay a quarterly cash dividenddividends of $0.30 per share ofon its Class A common stock. The declaration, amount and payment of this and any other future dividends on shares of PBF Energy Class A common stock will be at the sole discretion of our board of directors,PBF Energy’s Board Of Directors, and we are not obligated under any applicable laws, our governing documents or any contractual agreements with our existing owners or otherwise to declare or pay any dividends or other distributions (other than the obligations of PBF LLC to make tax distributions to its members).

As of SeptemberJune 30, 2018,2019, the Company had $2,191.3$1,755.3 million of unused borrowing availability, which includes PBF Holding cash and cash equivalents of $1,013.4$156.8 million, under the 2018 Revolving Credit AgreementFacility to fund its operations, if necessary. Accordingly, as of SeptemberJune 30, 2018,2019, there was sufficient cash and cash equivalents and borrowing capacity under our credit facilities available to make distributions to PBF LLC, if necessary, in order for PBF LLC to make pro-rata distributions to its members, including PBF Energy, necessary to fund in excess of one year’s cash dividend payments by PBF Energy. PBF Holding would have been permitted under its debt agreements to make these distributions; however, its ability to continue to comply with its debt covenants is, to a significant degree, subject to its operating results, which are dependent on a number of factors outside of our control. We believe our and our subsidiaries’ available cash and cash equivalents, other sources of liquidity to operate our business and operating performance provides us with a reasonable basis for our assessment that we can support our intended dividend and distribution policy.
PBF Logistics LP
PBFX has paid, and intends to continue to pay a minimum quarterly distribution of at least $0.30per unit per quarter, or $1.20 per unit on an annualized basis, which aggregates to approximately $13.8$18.9 million per quarter orand approximately $55.2$75.6 million per year,on an annualized basis, based on the number of common units and associated IDRs (as defined in “Note 3 - PBF Logistics LP” of our Notes to Condensed Consolidated Financial Statements) outstanding as of SeptemberJune 30, 2018. 2019.
During the ninesix months ended SeptemberJune 30, 2018,2019, PBFX made quarterly cash distributions totaling $72.5$59.6 million of which $37.0$30.4 million was distributed to PBF LLC and the balance was distributed to its public unitholders.
On October 31, 2018,August 1, 2019, the Board of Directors of PBFX’s general partner, PBF GP, announced a distribution of $0.50$0.515 per unit on outstanding common units of PBFX. The distribution is payable on NovemberAugust 30, 20182019 to PBFX common unitholders of record at the close of business on NovemberAugust 15, 2018.2019.
As of SeptemberJune 30, 2018,2019, PBFX had $4.0$4.1 million outstanding letters of credit and $446.0$244.9 million available under the PBFX Revolving Credit Facility and cash and cash equivalents of $18.0$20.0 million to fund its operations, if necessary. Accordingly, as of SeptemberJune 30, 2018,2019, there was sufficient cash and cash equivalents and borrowing capacity under our credit facilities available to PBFX to make distributions to unitholders.


Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risks, including changes in commodity prices and interest rates. Our primary commodity price risk is associated with the difference between the prices we sell our refined products and the prices we pay for crude oil and other feedstocks. We may use derivative instruments to manage the risks from changes in the prices of crude oil and refined products, natural gas, interest rates, or to capture market opportunities.
Commodity Price Risk
Our earnings, cash flow and liquidity are significantly affected by a variety of factors beyond our control, including the supply of, and demand for, crude oil, other feedstocks, refined products and natural gas. The supply of and demand for these commodities depend on, among other factors, changes in domestic and foreign economies, weather conditions, domestic and foreign political affairs, planned and unplanned downtime in refineries, pipelines and production facilities, production levels, the availability of imports, the marketing of competitive and alternative fuels, and the extent of government regulation. As a result, the prices of these commodities can be volatile. Our revenues fluctuate significantly with movements in industry refined product prices, our cost of sales fluctuates significantly with movements in crude oil and feedstock prices and our operating expenses fluctuate with movements in the price of natural gas. We manage our exposure to these commodity price risks through our supply and offtake agreements as well as through the use of various commodity derivative instruments.
We may use non-trading derivative instruments to manage exposure to commodity price risks associated with the purchase or sale of crude oil and feedstocks, finished products and natural gas outside of our supply and offtake agreements. The derivative instruments we use include physical commodity contracts and exchange-traded and over-the-counter financial instruments. We mark-to-market our commodity derivative instruments and recognize the changes in their fair value in our statements of operations.
At SeptemberJune 30, 20182019 and December 31, 2017,2018, we had gross open commodity derivative contracts representing 14.218.6 million barrels and 24.37.4 million barrels, respectively, with an unrealized net lossgain of $27.4$19.0 million and $74.3$7.2 million, respectively. The open commodity derivative contracts as of SeptemberJune 30, 20182019 expire at various times during 2018 and 2019.
We carry inventories of crude oil, intermediates and refined products (“hydrocarbon inventories”) on our balance sheet,Condensed Consolidated Balance Sheets, the values of which are subject to fluctuations in market prices. Our hydrocarbon inventories totaled approximately 31.8 million barrels and 30.5 million barrels and 30.1 million barrels at SeptemberJune 30, 20182019 and December 31, 2017,2018, respectively. The average cost of our hydrocarbon inventories was approximately $80.45$79.35 and $80.21$78.78 per barrel on a LIFO basis at SeptemberJune 30, 20182019 and December 31, 2017, respectively. The December 31, 2017 results exclude2018, respectively, excluding the net impact of an LCM inventory adjustmentadjustments of approximately $300.5$327.8 million whereas at September 30, 2018, the replacement value of inventories exceeded the LIFO carrying value.and $651.8 million, respectively. If market prices of our inventory declinesdecline to a level below our average cost, we may be required to write down the carrying value of our hydrocarbon inventories to market.
Our predominant variable operating cost is energy, which is comprised primarily of natural gas and electricity. We are therefore sensitive to movements in natural gas prices. Assuming normal operating conditions, we annually consume a total of approximatelybetween 68 million and 73 million MMBTUs of natural gas amongst our five refineries as of SeptemberJune 30, 2018.2019. Accordingly, a $1.00 per MMBTU change in natural gas prices would increase or decrease our natural gas costs by approximately $68.0 million to $73.0 million.
Compliance Program Price Risk
We are exposed to market risks related to the volatility in the price of RINs required to comply with the RFS. Our overall RINs obligation is based on a percentage of our domestic shipments of on-road fuels as established by EPA.Environmental Protection Agency (“EPA”). To the degree we are unable to blend the required amount of biofuels to satisfy our RINs obligation, we must purchase RINs on the open market. To mitigate the impact of this risk on our results of operations and cash flows we may purchase RINs when the price of these instruments is deemed favorable.

In addition, we are exposed to risks associated with complying with federal and state legislative and regulatory measures to address greenhouse gas and other emissions. Requirements to reduce emissions could result in increased costs to operate and maintain our facilities as well as implement and manage new emission controls and programs put in place. For example, AB32 in California requires the state to reduce its GHG emissions to 1990 levels by 2020.
Interest Rate Risk
The maximum availabilitycommitment under our 2018 Revolving Credit AgreementFacility is $3.4 billion. Borrowings under the 2018 Revolving Credit AgreementFacility bear interest either at the Alternative Base Rate plus the Applicable Margin or at Adjusted LIBOR plus the Applicable Margin, all as defined in the 2018 Revolving Credit Agreement. If this facility was fully drawn, a 1.0% change in the interest rate would increase or decrease our interest expense by approximately $34.0$21.5 million annually.
The PBFX Revolving Credit Facility, with a current maximum availabilitycommitment of $500.0 million, bears interest either at the Alternative Base Rate plus the Applicable Margin or at Adjusted LIBOR plus the Applicable Margin, all as defined in the PBFX Revolving Credit Facility.Agreement. If this facility was fully drawn, a 1.0% change in the interest rate would increase or decrease our interest expense by approximately $3.5$4.2 million annually.
In addition, the PBF Rail Term Loan, which bears interest at a variable rate, had an outstanding principal balance of $23.3$18.1 million at SeptemberJune 30, 2018.2019. A 1.0% change in the interest rate would increase or decrease our interest expense by approximately $0.23$0.2 million annually, assuming the current outstanding principal balance on the PBF Rail Term Loan remained outstanding.
We also have interest rate exposure in connection with our Inventory Intermediation Agreements under which we pay a time value of money charge based on LIBOR.
Credit Risk
We are subject to risk of losses resulting from nonpayment or nonperformance by our counterparties. We continue to closely monitor the creditworthiness of customers to whom we grant credit and establish credit limits in accordance with our credit policy.


Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
PBF Energy and PBF LLC maintain a system of disclosure controls and procedures that is designed to provide reasonable assurance that information which is required to be disclosed is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to management in a timely manner. Underconducted separate evaluations, under the supervision and with the participation of oureach company’s management, including PBF Energy’s and PBF LLC’sthe principal executive officer and the principal financial officer, we have evaluatedof the effectiveness of our system ofthe disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934)1934 as amended (the “Exchange Act”)) as of SeptemberJune 30, 2018.2019. Based on that evaluation, PBF Energy’s and PBF LLC’supon these evaluations, the principal executive officer and the principal financial officer, havein each case, concluded that PBF Energy’s and PBF LLC’sthe disclosure controls and procedures are effective as of SeptemberJune 30, 2018.2019.
Changes in Internal Control Over Financial Reporting
ManagementThere has not identified any changesbeen no change in PBF Energy’s or PBF LLC’s internal controlscontrol over financial reporting during the quarter ended SeptemberJune 30, 20182019 that havehas materially affected, or areis reasonably likely to materially affect either entity’sPBF Energy’s or PBF LLC’s internal controlscontrol over financial reporting.



PART II - OTHER INFORMATION
Item 1. Legal Proceedings
On July 24, 2013, the Delaware Department of Natural Resources and Environmental Control (“DNREC”)DNREC issued a Notice of Administrative Penalty Assessment and Secretary’s Order to Delaware City Refining for alleged air emission violations that occurred during the re-start of the refinery in 2011 and subsequent to the re-start. The penalty assessment seeks $460,200 in penalties and $69,030 in cost recovery for DNREC’s expenses associated with investigation of the incidents. We dispute the amount of the penalty assessment and allegations made in the order, and are in discussions with DNREC to resolve this assessment in addition to other Notices of Violation (“NOVs”) and DNREC claims of noncompliance related to activities at the assessment. ItDelaware City Refinery that have occurred since June 1, 2010, including associated Title V Permit deviations. In addition, Delaware City Refining Company has reported to DNREC that measured levels of particulate matter emissions from certain coke management facilities have exceeded applicable permit standards. Delaware City Refining Company has instituted measures to improve the performance of these systems and believes that particulate matter emissions now comply with applicable standards. Delaware City Refining Company will conduct additional testing in late August 2019 to confirm this expectation. DNREC and Delaware City Refining Company have completed negotiations of a comprehensive settlement agreement to resolve all DNREC claims for air quality issues at the Delaware City Refinery through October 31, 2018, and for the particulate matter emission issue related to the coke management sources through the effective date of the agreement. The agreement, which is possible that DNREC will assess a penalty in this matter but any such amount is not expected to be material to us.
On April 7, 2015, DNREC issuedexecuted shortly, provides for resolution of DNREC’s claims, a Notice of Violation (W-15-SWD-01) alleging violations of thepenalty payment by Delaware City refinery’s NPDES discharge permit during the period between December 12, 2014 through January 4, 2015. On March 5, 2018, a settlement agreement was finalized resolvingRefining Company of $950,000, and no admission of liability by Delaware City Refining Company with respect to the alleged violations containedair quality violations. The agreement will also result in modification and reissuance by DNREC of certain air quality permits for the April 7, 2015 Notice of Violation, as well as additional alleged violations occurring during the period between January 2014 through January 2018. Pursuantrefinery to this settlement agreement, theresolve claims by Delaware City refinery was either goingRefining Company objecting to pay a penalty of $30,000 and fund an approved Environmental Improvement Project (“EIP”) in the amount of $88,000, or pay a penalty in the amount of $118,000. A cost recovery payment of $7,433 will be assessed in either case. The Delaware City refinery has elected to pay the $30,000 penalty and fund the EIP in the amount of $88,000. The Delaware City refinery has paid the penalty and the cost recovery payment and will fund the approved EIP as soon as the project scope is finalized.certain prior permit conditions.
The Delaware City refinery is appealingappealed a Notice of Penalty Assessment and Secretary’s Order issued in March 2017, including a $150,000 fine, alleging violation of a 2013 Secretary’s Order authorizing crude oil shipment by barge. DNREC determined that the Delaware City refinery had violated the order by failing to make timely and full disclosure to DNREC about the nature and extent of those shipments, and had misrepresented the number of shipments that went to other facilities. The Penalty Assessment and Secretary’s Order conclude that the 2013 Secretary’s Order was violated by the refinery by shipping crude oil from the Delaware City terminal to three locations other than the Paulsboro refinery, on 15 days in 2014, making a total of 17 separate barge shipments containing approximately 35.7 million gallons of crude oil in total. On April 28, 2017, the Delaware City refinery appealed the Notice of Penalty Assessment and Secretary’s Order. On March 5, 2018, Notice of Penalty Assessment was settled by DNREC, the Delaware Attorney General and Delaware City refinery for $100,000. The Delaware City refinery made no admissions with respect to the alleged violations and agreed to request a Coastal Zone Act status decision prior to making crude oil shipments to destinations other than Paulsboro. The Delaware City refinery has paid the penalty. The Coastal Zone Act status decision request is being finalized and will bewas submitted to DNREC.DNREC and the outstanding appeal was withdrawn as required under settlement agreement. DNREC has confirmed that Delaware City Refining Company has fully satisfied its obligations under the agreement, and therefore that the resolution of liability provided under the agreement has taken effect.

On December 28, 2016, DNREC issued the Ethanol Permit to DCR allowing the utilization of existing tanks and existing marine loading equipment at their existing facilities to enable denatured ethanol to be loaded from storage tanks to marine vessels and shipped to offsite facilities. On January 13, 2017, the issuance of the Ethanol Permit was appealed by two environmental groups. On February 27, 2017, the Coastal Zone Board held a public hearing and dismissed the appeal, determining that the appellants did not have standing. The appellants filed an appeal of the Coastal Zone Board’s decision with the Superior Court on March 30, 2017. On January 19, 2018, the Superior Court rendered an Opinion regarding the decision of the Coastal Zone Board to dismiss the appeal of the Ethanol Permit for the ethanol project. The judge determined that the record created by the Coastal Zone Board was insufficient for the Superior Court to make a decision, and therefore remanded the case back to the Coastal Zone Board to address the deficiency in the record. Specifically, the Superior Court directed the Coastal Zone Board to address any evidence concerning whether the appellants’ claimed injuries would be affected by the increased quantity of ethanol shipments. DuringOn remand, the Coastal Zone Board met on January 28, 2019 and reversed its previous decision on standing ruling that the appellants have standing to appeal the issuance of the Ethanol Permit. The parties to the action have filed a joint motion with the Coastal Zone Board, requesting that the Board concur with the parties’ proposal to secure from the Superior Court confirmation that all rights and claims are preserved for any subsequent appeal to the Superior Court, and that the matter then be scheduled for a hearing on the merits before the Coastal Zone Board on standing, one of the appellants’ witnesses made a reference to the flammability of ethanol, without any indication of the significance of flammability/explosivity to specific concerns. Moreover, the appellants did not introduce at hearing any evidence of the relative flammability of ethanol as compared to other materials shipped to and from the refinery. However, the sole dissenting opinion from the Coastal Zone Board focused on the flammability/explosivity issue, alleging

that the appellants’ testimony raised the issue as a distinct basis for potential harms. Once the Board responds to the remand, it will go back to the Superior Court to complete its analysis and issue a decision.Board.
At the time we acquired the Toledo refinery, EPA had initiated an investigation into the compliance of the refinery with EPA standards governing flaring pursuant to Section 114 of the Clean Air Act. On February 1, 2013, EPA issued an Amended Notice of Violation (“NOV”), and on September 20, 2013, EPA issued a Notice of ViolationNOV and Finding of Violation to Toledo refinery, alleging certain violations of the Clean Air Act at its Plant 4 and Plant 9 flares since the acquisition of the refinery on March 1, 2011. Toledo refinery and EPA subsequently entered into tolling agreements pending settlement discussions. Although the resolution has not been finalized, the civil administrative penalty is anticipated to be approximately $645,000 including supplemental environmental projects. To the extent the administrative penalty exceeds such amount, it is not expected to be material to us.
In connection with the acquisition of the Torrance refinery and related logistics assets, we assumed certain pre-existing environmental liabilities related to certain environmental remediation obligations to address existing soil and groundwater contamination and monitoring activities, which reflect the estimated cost of the remediation obligations. In addition, in connection with the acquisition of the Torrance refinery and related logistics assets, we purchased a ten year, $100.0 million environmental insurance policy to insure against unknown environmental liabilities. Furthermore, in connection with the acquisition, we assumed responsibility for certain specified environmental matters that occurred prior to our ownership of the refinery and logistics assets, including specified incidents and/or notices of violations (“NOVs”)NOVs issued by regulatory agencies in various years before the Company’sour ownership, including the Southern California Air Quality Management District (“SCAQMD”) and the Division of Occupational Safety and Health of the State of California (“Cal/OSHA”).
In connection with the acquisition of the Torrance refinery and related logistics assets, we agreed to take responsibility for NOV No. P63405 that ExxonMobil had received from the SCAQMD for Title V deviations that are alleged to have occurred in 2015. On August 14, 2018, the Companywe received a letter from SCAQMD offering to settle this NOV for $515,250. The Company is currently in communication withOn February 22, 2019, the SCAQMD reduced their settlement offer to $268,500 which the Torrance refinery accepted and paid on May 8, 2019 to resolve this NOV.NOV with the SCAQMD.
Subsequent to the acquisition, further NOVs were issued by the SCAQMD, Cal/OSHA, the City of Torrance, the City of Torrance Fire Department, and the Los Angeles County Sanitation District related to alleged operational violations, emission discharges and/or flaring incidents at the refinery and the logistics assets both before and after our acquisition. EPA in November 2016 conducted a Risk Management Plan (“RMP”) inspection following the acquisition related to Torrance operations and issued preliminary findings in March 2017 concerning RMP potential operational violations. Since the EPA’s issuance of the preliminary findings in March 2017, the Company has been in substantive discussions to resolve the preliminary findings. In the course of these discussions, on November 8, 2018, EPA made an offer to settle all preliminary findings for $480,000. The Company is currently in communication with EPA to resolve the RMP preliminary findings.

EPA and the California Department of Toxic Substances Control (“DTSC”) in December 2016 conducted a Resource Conservation and Recovery Act (“RCRA”) inspection following the acquisition related to Torrance operations and also issued in March 2017 preliminary findings concerning RCRA potential operational violations. In April 2017, EPA referred the RCRA preliminary findings to DTSC for final resolution. On March 1, 2018, we received a notice of intent to sue from Environmental Integrity Project, on behalf of Environment California, under RCRA with respect to the alleged RCRA violations from December 2016 EPA’s and DTSC’s inspection. On March 2, 2018, DTSC issued an order to correct alleged RCRA violations relating to the accumulation of oil bearing materials in roll off bins during 2016 and 2017. On June 14, 2018, the Torrance refinery and DTSC reached settlement regarding the oil bearing materials in the form of a stipulation and order, wherein the Torrance refinery agreed that it would recycle or properly dispose of the oil bearing materials by the end of 2018 and pay an administrative penalty of $150,000. The Torrance refinery has complied with these requirements. Following this settlement, in June 2018, DTSC referred the remaining alleged RCRA violations from EPA’s and DTSC’s December 2016 inspection to the California Attorney General for final resolution. The Torrance refinery and the California Attorney General are in discussions to resolve these alleged remaining RCRA violations. Other than the $150,000 DTSC administrative penalty, no other settlement or penalty demands have been received to date with respect to any of the other NOVs, preliminary findings, or order that are in excess of $100,000. As the ultimate outcomes are uncertain, we cannot currently estimate the final amount or timing of their resolution but any such amount is not expected to have a material impact on our financial position, results of operations or cash flows, individually or in the aggregate.

On September 2, 2011, prior to our ownership of the Chalmette refinery, the plaintiff in Vincent Caruso, etal. v. Chalmette Refining, L.L.C., filed an action on behalf of himself and potentially several thousand other Louisiana residents who live or own property in St. Bernard Parish and Orleans Parish and whose property was allegedly contaminated and who allegedly suffered any property damages and clean-up costs as a result of an emission of spent catalyst from the Chalmette refinery on September 6, 2010. Plaintiffs claim to have suffered injuries, symptoms, and property damage as a result of the release, although the trial court has limited recovery to property damages and clean-up expenses. Plaintiffs seek to recover unspecified damages, interest and costs. In 2016, there was a mini-trial for four plaintiffs for property damage relating to home and vehicle cleaning and the trial court rendered judgment awarding damages related to the cost for home cleaning and vehicle cleaning to the four plaintiffs. The trial court found Chalmette Refining and co-defendant Eaton Corporation (“Eaton”), to be solidarily liable for the damages. Chalmette Refining and Eaton filed an appeal in August 2016 of the judgment on the mini-trial and on June 28, 2017, the appellate court unanimously reversed the judgment awarding damages to the plaintiffs, and plaintiffs request for rehearing was later denied. The parties are currently progressing settlement discussions. We presently believe the outcome of a settlement, or continued litigation, will not have a material impact on our financial position, results of operations or cash flows.
On December 5, 1990, prior to our ownership of the Chalmette refinery, the plaintiff in Adam Thomas, et al. v. Exxon Mobil Corporation and Chalmette Refining, L.L.C., filed an action on behalf of himself and potentially thousands of other individuals in St. Bernard Parish and Orleans Parish who were allegedly exposed to hydrogen sulfide and sulfur dioxide as a result of more than 100 separate flaring events that occurred between 1989 and 2007.2010. This litigation is proceeding as a mass action with individually named plaintiffs as a result of a 2008 trial court decision, affirmed by the court of appeals that denied class certification. The plaintiffs claim to have suffered physical injuries, property damage, and other damages as a result of the releases. Plaintiffs seek to recover unspecified compensatory and punitive damages, interest, and costs. Although no trial date has been set by the state trial court, theThe parties are preparing for aan October 2019 mini-trial of up to 10 plaintiffs, relating to as many as 5 separate flaring events that occurred between 2002 and 2007. Because of the number of potential claimants is unknown and the differing events underlying the claims, the potential amount of the claims is not determinable. It is possible that an adverse outcome may have a material adverse effect on our financial position, results of operations, or cash flows.
On February 17, 2017, in Arnold Goldstein, et al. v. Exxon Mobil Corporation, et al., we and PBF Energy Company LLC, and our subsidiaries, PBF Energy Western Region LLC and Torrance Refining Company LLC and the manager of our Torrance refinery along with Exxon Mobil Corporation were named as defendants in a class action and representative action complaint filed on behalf of Arnold Goldstein, John Covas, Gisela Janette La Bella and others similarly situated. The complaint was filed in the Superior Court of the State of California, County of Los Angeles and alleges negligence, strict liability, ultrahazardous activity, a continuing private nuisance, a permanent private nuisance, a continuing public nuisance, a permanent public nuisance and trespass resulting from the February 18, 2015 electrostatic precipitator (“ESP”) explosion at the Torrance refinery which was then owned and operated by ExxonMobil. The operation of the Torrance refinery by the PBF entities subsequent to our acquisition in July 2016 is also referenced in the complaint. To the extent that plaintiffs’ claims relate to the ESP explosion, Exxon has retained responsibility for any liabilities that would arise from the lawsuit pursuant to the agreement relating to the acquisition of the Torrance refinery. On July 2, 2018, the Court granted leave to plaintiffs’ to file a Second Amended Complaint alleging groundwater contamination. With the filing of the Second Amended Complaint, Plaintiffs’ added an additional plaintiff. As this matter is inOn March 18, 2019, the class certification phase, we cannothearing was held and the judge took the matter under submission. On April 1, 2019, the judge issued an order denying class certification. On April 15, 2019, Plaintiffs filed a Petition with the Ninth Circuit for Permission to Appeal the Order Denying Motion for Class Certification. The appeal is currently estimatepending with the amount orNinth Circuit. On May 3, 2019, Plaintiffs filed a Motion with the timing of its resolution.Central District Court for Leave to File a Renewed Motion for Class Certification. On May 22, 2019, the judge granted Plaintiffs’ motion. Our opposition to the motion was filed on July 29, 2019. The hearing on Plaintiffs’ motion is currently scheduled for September 23, 2019. We presently believe the outcome will not have a material impact on our financial position, results of operations or cash flows.

On September 18, 2018, in Michelle Kendig and Jim Kendig, et al. v. ExxonMobil Oil Corporation, et al., PBF Energy Limited and Torrance Refining Company LLC along with ExxonMobil Oil Corporation and ExxonMobil Pipeline Company were named as defendants in a class action and representative action complaint filed on behalf of Michelle Kendig, Jim Kendig and others similarly situated. The complaint was filed in the Superior Court of the State of California, County of Los Angeles and alleges failure to authorize and permit uninterrupted rest and meal periods, failure to furnish accurate wage statements, violation of the Private Attorneys General Act and violation of the California Unfair Business and Competition Law. Plaintiffs seek to recover

unspecified economic damages, statutory damages, civil penalties provided by statute, disgorgement of profits, injunctive relief, declaratory relief, interest, attorney’s fees and costs. To the extent that plaintiffs’ claims accrued prior to July 1, 2016, ExxonMobil has retained responsibility for any liabilities that would arise from the lawsuit pursuant to the agreement relating to the acquisition of the Torrance refinery and logistics assets. On October 26, 2018, the matter was removed to the Federal Court, California Central District. A mediation hearing between the parties is currently scheduled for August 23, 2019. As this matter was recently filed,is in the class certification phase, we cannot currently estimate the amount or the timing of its resolution. We presently believe the outcome will not have a material impact on our financial position, results of operations or cash flows.
On September 7, 2018, in Jeprece Roussell, et al. v. PBF Consultants, LLC, etal., the Plaintiff filed an action in the 19th Judicial District Court for the Parish of East Baton Rouge, alleges numerous causes of action, including wrongful death, premises liability, negligence, and gross negligence against PBF Holding Company LLC, PBFX Operating Company LLC, Chalmette Refining, L.L.C., two individual employees of the Chalmette Refinery (“the PBF Defendants”), two entities, PBF Consultants, LLC and PBF Investments, LLC that are Louisiana companies that are not associated with our companies, as well as Clean Harbors, Inc. and Clean Harbors Environmental Services, Inc. (collectively, “Clean Harbors”), Mr. Roussell’s employer. Mr. Roussell was fatally injured on March 31, 2018 while performing clay removal work activities inside a clay treating vessel located at the Chalmette Refinery. Plaintiff seeks unspecified compensatory damages for pain and suffering, past and future mental anguish, impairment, past and future economic loss, attorney’s fees and court costs. The PBF Defendants have issued a tender of defense and indemnity to Clean Harbors and its insurer pursuant to indemnity obligations contained in the associated services agreement. On September 25, 2018, the PBF Defendants filed an Answer in the state court action denying the allegations. On October 10, 2018, the PBF Defendants filed to remove the case to the United States District Court for the Middle District of Louisiana. On November 9, 2018, Plaintiff filed a motion to remand the matter back to state court and the PBF Defendants filed a response on November 30, 2018. On December 21, 2018, Plaintiff filed a motion for leave to file a reply memorandum and the reply memorandum was filed December 27, 2018. On April 15, 2019 the Federal Magistrate Judge filed a Report and Recommendation denying Plaintiff’s motion to remand and dismissing without prejudice the claims against John Sprafka, Wayne LaCombe, PBF Consultants, LLC and PBF Investments, LLC. On June 24, 2019, the Federal Judge adopted the Magistrate Judge’s Report and Recommendation denying Plaintiff’s motion to remand and dismissing without prejudice the claims against John Sprafka, Wayne LaCombe, PBF Consultants, LLC and PBF Investments, LLC. As this matter was recently filed, we cannot currently estimate the amount or the timing of its resolution. We presently believe the outcome will not have a material impact on our financial position, results of operations or cash flows.
We are subject to obligations to purchase RINs. On February 15, 2017, we received notification that EPA records indicated that PBF Holding used potentially invalid RINs that were in fact verified under EPA’s RIN Quality Assurance Program (“QAP”) by an independent auditor as QAP A RINs. Under the regulations use of potentially invalid QAP A RINs provided the user with an affirmative defense from civil penalties provided certain conditions are met. We have asserted the affirmative defense and if accepted by EPA will not be required to replace these RINs and will not be subject to civil penalties under the program. It is reasonably possible that EPA will not accept our defense and may assess penalties in these matters but any such amount is not expected to have a material impact on our financial position, results of operations or cash flows.
As of January 1, 2011, we are required to comply with EPA’s Control of Hazardous Air Pollutants From Mobile Sources, or MSAT2, regulations on gasoline that impose reductions in the benzene content of our produced gasoline. We purchase benzene credits to meet these requirements. Our planned capital projects will reduce the amount of benzene credits that we need to purchase. In addition, the renewable fuel standards mandate the blending of prescribed percentages of renewable fuels (e.g., ethanol and biofuels) into our produced gasoline and diesel. These new requirements, other requirements of the CAA and other presently existing or future environmental regulations may cause us to make substantial capital expenditures as well as the purchase of credits at significant cost, to enable our refineries to produce products that meet applicable requirements.

CERCLA, also known as “Superfund,” imposes liability, without regard to fault or the legality of the original conduct, on certain classes of persons who are considered to be responsible for the release of a “hazardous substance” into the environment. These persons include the current or former owner or operator of the disposal site or sites where the release occurred and companies that disposed of or arranged for the disposal of the hazardous substances. Under CERCLA, such persons may be subject to joint and several liability for investigation and the costs of cleaning up the hazardous substances that have been released into the environment, for damages to natural resources and for the costs of certain health studies. As discussed more fully above, certain of our sites are subject to these laws and we may be held liable for investigation and remediation costs or claims for natural resource damages. It is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damage allegedly caused by hazardous substances or other pollutants released into the environment. Analogous state laws impose similar responsibilities and liabilities on responsible parties. In our current normal operations, we have generated waste, some of which falls within the statutory definition of a “hazardous substance” and some of which may have been disposed of at sites that may require cleanup under Superfund.

Item 1A. Risk Factors
The following risk factors supplement and/or update the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2018:
Risks Relating to Our Business and Industry
Our announced Martinez Acquisition may not close when we expect, or at all, and may pose unforeseen risks and/or not have the benefits we expect.
On June 11, 2019, we entered into an agreement to purchase the Martinez refinery and related logistics assets. The aggregate purchase price for the Martinez Acquisition will range from $900.0 million to $1.0 billion in cash, based on closing date, plus inventory and working capital to be determined at closing. The purchase price is also subject to other customary purchase price adjustments. The Martinez Acquisition is expected to close in the second half of 2019, subject to satisfaction of customary closing conditions. There can be no assurance that we will complete the Martinez Acquisition under the terms set forth in the purchase agreement, or at all. We expect to finance the transaction through a combination of cash on hand and debt. The Martinez Acquisition is subject to numerous risks and uncertainties, including (i) the possibility that the announced acquisition will be delayed or will not close due to the failure of either party to satisfy the closing conditions, or for other reasons, (ii) the risk that the Martinez refinery will not be integrated into our company successfully or that expected benefits will not be realized and (iii) unforeseen liabilities associated with the Martinez Acquisition.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Exchange of PBF LLC Series A Units to PBF Energy Class A Common Stock
In the three months ended SeptemberJune 30, 2018, 10,5842019, 10,000 PBF LLC Series A Units were exchanged for 10,58410,000 shares of ourPBF Energy Class A common stock in transactions exempt from registration under Section 4(a)(2) of the Securities Act. We received no other consideration in connection with any exchanges. No exchanges were made by any of our directors or current executive officers.
Share Repurchase Program
Our Board of Directors authorized the repurchase of up to $300.0 million of our Class A common stock (as amended from time to time, the “Repurchase Program”), which expired on September 30, 2018 and was not renewed. These repurchases were made from time to time through various methods, including open market transactions, block trades, accelerated share repurchases, privately negotiated transactions or otherwise, certain of which may have been effected through Rule 10b5-1 and Rule 10b-18 plans. The timing and number of shares repurchased depended on a variety of factors, including price, capital availability, legal requirements and economic and market conditions. We were not obligated to purchase any shares under the Repurchase Program, and repurchases may have been suspended or discontinued at any time without prior notice.
There were no repurchases of our Class A Common Stock during the third quarter of 2018. For the period of time from the inception of the Repurchase Program through September 30, 2018, we purchased 6,050,717 shares for $150.8 million.


Item 6. Exhibits
The exhibits listed in the accompanying Exhibit Index are filed or incorporated by reference as part of this report and such Exhibit Index is incorporated herein by reference.
EXHIBIT INDEX
Exhibit
Number
 Description
   
2.12.1**
 PurchaseSale and SalePurchase Agreement dated July 16, 2018, among Crown Point InternationalJune 11, 2019 by and between PBF Holding Company LLC as Seller, PBF Logistics LP, as Purchaser and CPI OperationsEquilon Enterprises LLC for the limited purposes set forth thereind/b/a Shell Oil Products US (incorporated by reference to Exhibit 2.1 filed with PBF Logistics LP’s Current Report on Form 8-K dated July 20, 2018 (File No. 001-36446))
4.1
Sixth Supplemental Indenture dated as of September 11, 2018, among DCR Storage and Loading LLC, Chalmette Logistics Company LLC, Toledo Rail Logistics Company LLC, Paulsboro Terminaling Company LLC, PBF Logistics LP, PBF Logistics Finance Corporation, and Deutsche Bank Trust Company Americas, as trustee (incorporated by reference to Exhibit 4.1 filed with PBF Logistics LP’s Quarterly Report on Form 10-Q dated October 31, 2018 (File No. 001-36446))
10.1
Amended and Restated Revolving Credit Agreement dated as of July 30, 2018, among PBF Logistics LP, the lender party hereto and Wells Fargo Bank, National Association as Administrative Agent (incorporated by reference to Exhibit 10.1 filed with PBF Energy Inc.’s Current Report on Form 8-K dated August 2, 2018June 11, 2019 (File No. 001-35764)).
2.2**
Contribution Agreement dated as of April 24, 2019 by and between PBF Energy Company LLC and PBF Logistics LP (incorporated by reference to Exhibit 2.1 filed with PBF Energy Inc.’s Current Report on Form 8-K dated April 26, 2019 (File No. 001-35764))
   
10.2
Fifth Amended and Restated Omnibus Agreement dated as of July 31, 2018, among PBF Holding Company LLC, PBF Energy Company LLC, PBF Logistics GP LLC and PBF Logistics LP (incorporated by reference to Exhibit 10.2 filed with PBF Logistics LP’s Quarterly Report on Form 10-Q dated October 31, 2018 (File No. 001-36446))
10.3
Sixth Amended and Restated Operation and Management Services and Secondment Agreement dated as of July 31, 2018, among PBF Holding Company LLC, Delaware City Refining Company LLC, Toledo Refining Company LLC, Torrance Refining Company LLC, Torrance Logistics Company LLC, Chalmette Refining L.L.C., Paulsboro Refining Company LLC, PBF Logistics GP LLC, PBF Logistics LP, DCR Storage and Loading LLC, Delaware City Terminaling Company LLC, Toledo Terminaling Company LLC, Delaware Pipeline Company LLC, Delaware City Logistics Company LLC, Paulsboro Terminaling Company LLC, Paulsboro Natural Gas Pipeline Company LLC, Toledo Rail Logistics Company LLC, Chalmette Logistics Company LLC and PBFX Operating Company LLC (incorporated by reference to Exhibit 10.3 filed with PBF Logistics LP’s Quarterly Report on Form 10-Q dated October 31, 2018 (File No. 001-36446))
10.4
Joinder Agreement dated as of September 7, 2018, among DCR Storage and Loading LLC, Chalmette Logistics Company LLC, Toledo Rail Logistics Company LLC, Paulsboro Terminaling Company LLC and Wells Fargo Bank, National Association, as Administrative Agent (incorporated by reference to Exhibit 10.4 filed with PBF Logistics LP’s Quarterly Report on Form 10-Q dated October 31, 2018 (File No. 001-36446))
31.1*
 Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Inc. pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
   
31.2*
 Certification of Erik Young, Chief Financial Officer of PBF Energy Inc. pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
   
31.3*
 Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Company LLC pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
   
31.4*
 Certification of Erik Young, Chief Financial Officer of PBF Energy Company LLC pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
   
32.1* (1)
 Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
   
32.2* (1)
 Certification of Erik Young, Chief Financial Officer of PBF Energy Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
   
32.3* (1)
 Certification of Thomas J. Nimbley, Chief Executive Officer of PBF Energy Company LLC pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
   

32.4* (1)
 Certification of Erik Young, Chief Financial Officer of PBF Energy Company LLC pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
   
101.INS Inline XBRL Instance Document.
   
101.SCH Inline XBRL Taxonomy Extension Schema Document.
   
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document.
   
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document.
   
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document.
   
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document.
———————
**Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.
*Filed herewith.
(1)This exhibit should not be deemed to be “filed” for purposes of Section 18 of the Exchange Act.


Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
  PBF Energy Inc.
     
Date:October 31, 2018August 1, 2019 By:/s/ Erik Young
    
Erik Young
Senior Vice President, Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)
     
  PBF Energy Company LLC
     
Date:October 31, 2018August 1, 2019 By:/s/ Erik Young
    
Erik Young
Senior Vice President, Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)
     




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