Risk Factors Update Summary

• The company's dependence on HF Sinclair for a substantial portion of its revenues poses a material risk. A significant reduction in HF Sinclair's revenues or financial condition could have a material adverse effect on the company's revenues. This change might result in a decrease in revenues by 2-3%.
• Increased risk of cyber events and breaches, including incidents and breaches of data security. This change might result in system interruptions, delays, loss of critical data, and potential liability.
• The Biden Administration's revisions to NEPA regulations now require consideration of indirect and cumulative impacts, including climate change and greenhouse gas emissions. The substance of additional changes to NEPA rules is uncertain.
• The company faces potential disruptions from vandalism, terrorism, cyberattacks, and other causes.
• The company changed its general partner from HFC to HF Sinclair, impacting cost reimbursements and administrative fees.
• The company's lack of asset and geographic diversification increases the risk to its operations and cash flows. This change might result in a higher concentration of risk and potential disruptions to operations.
• Compliance with evolving data protection laws and regulations, including potential legal and reputational risks. This change could increase costs and complexity of compliance and result in proceedings or actions against the company.
• A requirement to disgorge charges collected for services in excess of the rate established by the FERC could adversely affect revenues and cash flow related to affected assets. This change might result in financial penalties and reduced profitability.
• The non-competition provisions of the Omnibus Agreement apply to businesses operated by HF Sinclair or its subsidiaries.
• Potential enforcement actions due to non-compliance with government regulations, which may have a material adverse effect on the business.
• The company's ability to transport volumes of refined products in its pipelines may be reduced.
• Environmental groups have challenged the use of the Corps' Nationwide Permit 12 for oil and gas pipeline projects, and the outcome of ongoing litigation is uncertain.
• The company's operations are subject to cyberattacks, data security breaches, and network disruptions, which could have a material adverse effect on its results of operations or cash flows. This change highlights the increased risk of cybersecurity threats.
• State regulatory commissions generally have not investigated rates or practices of petroleum pipelines in the absence of shipper complaints, but there is a possibility of investigation that could result in civil penalty liability of up to approximately $14,536 per violation per day.
• The company paid HF Sinclair a temporary monthly fee of $62,500 for transition services.
• The company added that HF Sinclair and REH Company have registration rights with respect to the common units they hold.
• The company added that HF Sinclair and its affiliates may engage in limited competition with the company.
• Market risk exposure due to floating interest rates and potential significant increases in interest rates, which could adversely affect the company's financial position.
• Ongoing efforts at the international, national, regional, and state levels of government to monitor and limit greenhouse gas emissions could increase operating costs or reduce demand for customers' products, impacting our business and operations.
• HF Sinclair currently holds 59,630,030 common units, approximately 57% of the outstanding units.
• The reporting date for the issuance of common units changed from 2021 to 2022, with no units issued in 2022.
• Uncertainty exists regarding tribal jurisdiction and potential restrictions on the transportation of crude oil and refined products.
• The Corps announced a reissuance of NWP 12 for oil and natural gas pipeline activities, which is also being challenged in federal court.
• The EPA has adopted rules to control and reduce greenhouse gas emissions from certain sources, and there are ongoing proposals to revise and expand these rules, potentially impacting our operations and increasing compliance costs.
• Labor costs and availability of trained workers may impact the company's productivity.
• The Biden Administration's Social Cost of Carbon (SCC) metric may impact future regulatory decision-making, and a court stay on the interim SCC value is in progress.
• Limitations in credit agreements and indenture for senior notes may reduce the company's ability to incur additional debt and compete with less leveraged competitors.
• Proposed rule changes could expand the definition of "waters of the United States" under the Clean Water Act, potentially increasing costs and regulatory requirements.
• The SEC has proposed rules that would require public companies to include climate-related disclosures in their registration statements and periodic reports, including information about climate-related risks and greenhouse gas emissions.
• Uncertainty in obtaining funding and increased cost of raising money, which could impact revenues and results of operations.
• The company's ability to renew or replace contracts with customers at sufficient rates is dependent on factors outside its control.
• Conflicts of interest between the company and its affiliates, including potential favoritism and situations where the interests of the affiliates may not align with those of the common unitholders.
• New regulations related to valve installation, rupture detection, and integrity management for hazardous liquid pipelines may result in additional costs.
• The company's joint ventures and partial ownership in systems may impact its business decisions and financial results.
• Increasing societal expectations and actions by large institutional lenders and investors to divest from fossil fuel equities could have a negative impact on our unit price and access to capital.
• Regulatory actions, such as the temporary suspension of authorizations for oil and gas activities on federal lands, could affect pipeline construction projects.
• Adverse decisions by the FERC or state regulatory authorities on rates for interstate and intrastate pipeline services could affect revenue and financial position.
• The investment community's increasing focus on ESG practices and disclosures, including climate change and diversity initiatives, may result in higher costs, disruption, and demands for engagement that could strain our resources and present legal and regulatory risks.