HF Sinclair CorpDINO
HF Sinclair Corp Leases Disclosure
Leases
Lessee
We have operating and finance leases for land, buildings, pipelines, storage tanks, transportation and other equipment for our operations. Our leases have remaining terms of to 54 years, some of which include options to extend the leases for up to 10 years. Certain of our leases for pipeline assets include provisions for variable payments that are based on a measure of throughput and provisions that allow the lessor to adjust the rate per barrel periodically over the life of the lease. These variable costs are not included in the initial measurement of ROU assets and lease liabilities.
The following table presents the amounts and locations of our operating and finance leases recorded on our consolidated balance sheets:
| December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| (In millions) | ||||||||||||||
| Operating leases: | ||||||||||||||
Operating lease right-of-use assets | $ | 349 | $ | 355 | ||||||||||
Operating lease liabilities | 85 | 77 | ||||||||||||
| Noncurrent operating lease liabilities | 289 | 301 | ||||||||||||
| Total operating lease liabilities | $ | 374 | $ | 378 | ||||||||||
| Finance leases: | ||||||||||||||
| Properties, plants and equipment, at cost | $ | 124 | $ | 115 | ||||||||||
| Less: accumulated amortization | (41) | (37) | ||||||||||||
| $ | 83 | $ | 78 | |||||||||||
| $ | 14 | $ | 11 | |||||||||||
| 75 | 71 | |||||||||||||
| Total finance lease liabilities | $ | 89 | $ | 82 | ||||||||||
Supplemental balance sheet information related to our leases was as follows:
| December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
Weighted-average remaining lease term (in years): | ||||||||||||||
| Operating leases | 8.6 | 9.2 | ||||||||||||
| Finance leases | 7.3 | 8.1 | ||||||||||||
Weighted-average discount rate: | ||||||||||||||
| Operating leases | 5.6 | % | 5.6 | % | ||||||||||
| Finance leases | 6.3 | % | 6.1 | % | ||||||||||
The components of lease expense were as follows:
| Years Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Operating lease expense | $ | 109 | $ | 131 | $ | 121 | ||||||||||||||
| Finance lease expense: | ||||||||||||||||||||
Amortization of ROU assets | 14 | 12 | 13 | |||||||||||||||||
| Interest on lease liabilities | 5 | 5 | 3 | |||||||||||||||||
| Variable lease cost | 4 | 13 | 13 | |||||||||||||||||
| Total lease expense | $ | 132 | $ | 161 | $ | 150 | ||||||||||||||
Supplemental cash flow information related to leases was as follows:
| Years Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||||||||||||||
| Operating cash flows from operating leases | $ | 106 | $ | 130 | $ | 128 | ||||||||||||||
| Operating cash flows from finance leases | $ | 5 | $ | 5 | $ | 3 | ||||||||||||||
| Financing cash flows from finance leases | $ | 11 | $ | 11 | $ | 12 | ||||||||||||||
| Right-of-use assets obtained in exchange for lease obligations: | ||||||||||||||||||||
| Operating leases | $ | 84 | $ | 126 | $ | 103 | ||||||||||||||
| Finance leases | $ | 19 | $ | 8 | $ | 38 | ||||||||||||||
As of December 31, 2025, minimum future lease payments of our operating and finance lease obligations were as follows:
| Operating | Finance | |||||||||||||
| (In millions) | ||||||||||||||
| 2026 | $ | 100 | $ | 18 | ||||||||||
| 2027 | 77 | 16 | ||||||||||||
| 2028 | 51 | 16 | ||||||||||||
| 2029 | 38 | 14 | ||||||||||||
| 2030 | 33 | 12 | ||||||||||||
| Thereafter | 199 | 35 | ||||||||||||
| Future minimum lease payments | 498 | 111 | ||||||||||||
| Less: imputed interest | (124) | (22) | ||||||||||||
| Total lease obligations | 374 | 89 | ||||||||||||
| Less: current obligations | (85) | (14) | ||||||||||||
| Long-term lease obligations | $ | 289 | $ | 75 | ||||||||||
Lessor
Our consolidated statements of income reflect lease revenue recognized by our midstream operations for contracts with third parties in which we are the lessor.
Substantially all of the assets supporting contracts that meet the definition of a lease have long useful lives, and we believe these assets will continue to have value when the current agreements expire as a result of our risk management strategy to protect the residual fair value of the underlying assets by performing ongoing maintenance during the lease term.
Lease income recognized was as follows:
| Years Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Operating lease revenues | $ | 17 | $ | 17 | $ | 17 | ||||||||||||||
| Sales-type lease interest income | $ | 2 | $ | 2 | $ | 2 | ||||||||||||||
| Lease revenues relating to variable lease payments not included in measurement of the sales-type lease receivable | $ | 1 | $ | 2 | $ | 1 | ||||||||||||||
For our third-party sales-type leases, we included customer obligations related to minimum volume requirements in guaranteed minimum lease payments. Portions of our minimum guaranteed pipeline tariffs for assets subject to sales-type lease accounting are recorded as interest income with the remaining amounts recorded as a reduction in net investment in leases. We recognized any billings for throughput volumes in excess of minimum volume requirements as variable lease payments, and these variable lease payments were recorded in lease revenues.
Annual minimum undiscounted lease payments for third-party contracts for which we were the lessor as of December 31, 2025, were as follows:
| Operating | Sales-Type | |||||||||||||
| (In millions) | ||||||||||||||
| 2026 | $ | 14 | $ | 2 | ||||||||||
| 2027 | 14 | 2 | ||||||||||||
| 2028 | 13 | 2 | ||||||||||||
| 2029 | 13 | 2 | ||||||||||||
| 2030 | 2 | 2 | ||||||||||||
| Thereafter | — | 10 | ||||||||||||
| Total lease payment receipts | $ | 56 | 20 | |||||||||||
| Less: imputed interest | (4) | |||||||||||||
| Lease receivables | $ | 16 | ||||||||||||
Net investment in sales-type leases, which is recorded in Intangibles and other on our consolidated balance sheets, was composed of the following:
| December 31, | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| (In millions) | ||||||||||||||
| Lease receivables | $ | 16 | $ | 17 | ||||||||||
| Unguaranteed residual assets | 16 | 16 | ||||||||||||
| Net investment in leases | $ | 32 | $ | 33 | ||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 28, 2023 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.