Hello and welcome to the Par Petroleum Corporation Second quarter 2014 Earnings Call. My name is Joe and I will be your operator for today’s call. At this time, all participants are in a listen-only mode and later we will conduct a question-and-answer session. Please note that this conference is also being recorded. I will now turn the call over to Mr. Brice Tarzwell, Senior Vice President and Chief Legal Officer of Par Petroleum. Mr. Tarzwell, you may begin.

Good morning. And welcome to Par Petroleum’s earning call for the second quarter of 2014. Before we begin we’d like to remind everyone that management’s comments today may contain forward-looking statements. These forward-looking statements address expectations, estimates and projections, and may involve significant risks and uncertainties which could cause actual results to differ materially from the results discussed. Information about the risk we face and the uncertainties associated with Par Petroleum’s forward-looking statements can be found in the company’s annual and quarterly reports filed with the SEC. Because of these risks and uncertainties investors should not place undue reliance on forward-looking statements we disclaim any intention or obligation to update or revise any forward-looking statements. We will next turn to remarks from our Chairman and Chief Executive Officer, Will Monteleone. Will?

Thank you, Brice. Good morning ladies and gentlemen. At this point you should have our earnings release and our 10-Q will be filed later today. As I communicated on our conference call two weeks ago our second quarter results were negatively affected by the compression in crack spreads beginning in mid-May but particularly during June. Not readily apparent in the headline numbers disclosed in the press release we did see improvements in our profitability during April and May, however these improvements were more than offset by the deterioration in crack spreads particularly in the distillate portion of the barrel during June. Beginning from the middle of June concerns regarding Iraq drove brent prices to spike by approximately $7 a barrel over the course of two weeks while refined product prices on the West Coast and Singapore lagged. Our largest product exposure is jet fuel with the heavy weighting towards the Singapore marketplace. During the quarter the Singapore jet crack measured as spot Singapore jet less brent compressed from $12.40 a barrel in April to $8.83 a barrel in June. As a point of reference for the full year 2013 the Singapore jet crack averaged $14.16 a barrel. We have seen this market indicator improve in July with the average returning to the $10.57 a barrel range. And continuing to improve to $13.02 a barrel during the month of August thus far. To give you a sense of the importance of this indicator every $1 a barrel move in the jet crack affects our annual profitability by between $6.5 million and $7.5 million. During the quarter we also incurred almost $2.5 million of acquisition in integration costs. If you breakdown these costs, approximately $900,000 were associated with the Mid Pac transaction with the remainder associated with integrating the Hawaii operations. In…

Thank you. We will now begin the question-and-answer session. (Operator Instructions). And our first question here comes from Mr. Andrew Shapiro from Lawndale Capital. Please go ahead.

Hi, good morning.

Good morning.

Questions on the new acquisition. You said that you are working through the regulatory process you have got the second information request, there was always a time deadline for the first request in terms of when and if they had to come up with a second request is there similarly a time deadline and where is the information they ask for within your realm of expectations to tackle?

The time frames underneath the second request are less concrete and ultimately the scope of their requests at this point, we recently received it so we are in the early stages of processing it. And I don’t think at this point we can comment specifically on the duration except that we do expect that we’ll move quickly through it and still believe that we can close the acquisition by the end of this year.

Okay. And in the event the regulatory authorities have a problem with this, is there any form of a break fee or any other kind of liability for the company other than some cost of the due diligence and processing?

No, both parties agreed to accept the HSR risk and so there is no breakup on either side to the extent that we have a larger regulatory issue.

Okay.

Other than some costs and transaction costs that we've incurred.

Okay. And are you still looking for this deal to become immediately accretive to take advantage of the [NOL] and in particular on the last call. Which was not too long ago, you highlighted $6 to $10 a barrel of transport savings plus about $5 million or so of then identified operational synergies, have any other advantages or quantification come since the last call?

No, those numbers are still valid and obviously our statement on the accretive nature of the transaction assumes that it’s closed by January 1, 2015 and we get the full year benefit of those volumes in Mid Pac business underneath our umbrella for that full fiscal year.

Thank you. (Operator Instructions). And we do have one more question here from Mr. Andrew Shapiro from Lawndale Capital. Please go ahead, sir.

Thanks. A few follow-ups, it seems like there is not anyone else there. The reduction in the value of the contingent payments do on the Hawaii Independent Energy acquisition that resulted in the gain. Is that the result of Hawaii Energy not hitting the seller's projected operating performance?

Effectively we have to fair value the earn out potential and therefore I think it’s accurate to say that for the 2014 time period that we don't anticipate making an earn out payment given the results.

Okay. And when does the contingent liability and measurement run its course?

It’s every calendar year. And I believe -- hold on one second. It's a three year term and ultimately it’s measured on a calendar year basis.

Okay. So, three years from…

‘14, ‘15, ‘16 basically.

‘15, ‘16, okay. What effects did the company see from recent -- the two big storms in Hawaii might just have any negative impact that will show in your third quarter numbers or was the effect minimal?

Well, there was a significant amount of preparation that went into the storms. And I would say that the team in Hawaii did an excellent job planning contingencies and ensuring that we did everything we can to ensure that the neighbors islands are well supplied. We really didn't have any significant impacts to the business, other than slightly reduced rates for a couple of days but no damage or significant damage to any of our assets on the islands. So, thankful for that. And the team in the Hawaii did an excellent job.

Okay. I have a few more questions. I’ll back out into the queue. Come back to me please.

Okay.

And we have another question here from [Edward Collier from Arbiter Partners]. Please go ahead.

Hi guys. I just want to make sure if the acquisition doesn't close before the first, do you still get those contracted volumes?

We have a contingent supply arrangement with the target. And so in the event the acquisition isn’t in place by January 1, we do feel like, we’d be able to supply them under that arrangement.

Okay. Thank you.

And we have a question here from Rob Stuckey from Barclays. Please go ahead.

With regards to the acquisition, it seems more a function of how many gas stations will be able to keep versus the deal not going through; is this accurate assessment? And in the case we do have to sell some gas stations to complete the acquisition, can you talk little bit about the asset value underlying those assets.

Difficult for me to speculate on what the FTC would require in the event that we would need to make any divestments. Ultimately, I think the underlying value that you re referencing likely has to the fee-owned real estate and ultimately that's in excess of 20 stations primarily in Oahu and we think that's an excellent long-term advantage and the source of value for us in this field.

Thanks.

And thank you. Our next question here comes from [Janine McArdle from Flags]. Please go ahead.

Hi, I was hoping you could help me with your rates at your refineries. You said you were slightly reduced for a couple of days because of the storm. What sets to reduce your rates for the quarter, your average group?

Shouldn't have any material impact.

Okay. And can you tell me in the third quarter, how you are running your crude slate between light and heavy, what percentage?

We don't disclose that level of detail on a forward looking basis.

That’s okay. And then my third and last question is about Mexico. Do you have a contract with them, is that could you tell me a little bit about how much you’re taking in all this reschedule?

I would say we’re in the early stages of working with our counterparties with [MX] and it would be too early to discuss the current state of that relationship.

You just take one, you did take a delivery this quarter right?

Correct.

Okay, great. Thank you so much.

Thank you.

And we have one more question here from Andrew Shapiro from Lawndale Capital. Please go ahead.

Yes. A follow-up from an earlier person’s question, what islands do you have retail cross-over on with your 76 [solar] stations?

I mean effectively on the Big Island on Hawaii, Maui and Oahu.

On all three. Okay.

On all three, we have no stations on Kauai.

Okay. And if you could you summarize combined on any of those particular islands any particular large market share that’s created by the deal, where there maybe the FTC risk?

No I don’t think that’d be appropriate at this juncture.

Okay. And then lastly do you have any early indication on if all the shareholders plan to exercise their rights and to what extent people might over subscribe since the deadline is coming up and people then sending in irrevocable notice?

Yes, I think it’s still early. I think we still have the support of our two largest shareholders of White Box Advisors and Zell Credit Opportunities Fund and at that point I think it’s still a little bit too early.

And thank you. At this time, I show no additional questions. Thank you for your participation. And you may now disconnect. This does conclude the call.