FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2013

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

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 March 31, 2013 and December 31, 2012.

	As of March 31, 2013
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	220,830	$	—	$	—	$	220,830
Commodity contracts	1,255		9,715		—		10,970
Liabilities:
Catalyst lease obligations	—		44,780		—		44,780
Derivatives included with inventory supply arrangement obligations	—		2,156		—		2,156
Contingent consideration for refinery acquisition	—		—		21,358		21,358

	As of December 31, 2012
	Level 1		Level 2		Level 3		Total
Assets:
Money market funds	$	175,786	$	—	$	—	$	175,786
Commodity contracts	3,303		—		—		3,303
Derivatives included with inventory supply arrangement obligations	—		5,595		—		5,595
Liabilities:
Catalyst lease obligations	—		43,442		—		43,442
Commodity contracts	—		1,872		—		1,872
Contingent consideration for refinery acquisition	—		—		21,358		21,358

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 derivatives included with inventory supply arrangement 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 future commodity prices for similar instruments quoted in active markets.

• The contingent consideration for refinery acquisition obligation at December 31, 2012 is categorized in Level 3 of the fair value hierarchy and is estimated using a discounted cash flow model based on management's estimate of the future cash flows of the Toledo refinery; a risk free rate of return of 0.16%; credit rate spread of 4.38%; and a discount rate of 4.54%. During the three months ended March 31, 2013, there was no change in fair value, as the obligation is known and was paid in full on April 30, 2013.

The table below summarizes the changes in fair value measurements categorized in Level 3 of the fair value hierarchy:

	Three Months Ended March 31,
	2013		2012
Balance at beginning of period	$	21,358	$	122,232
Purchases	—		—
Settlements	—		—
Unrealized loss included in earnings	—		692
Transfers into Level 3	—		—
Transfers out of Level 3	—		—
Balance at end of period	$	21,358	$	122,924

There were no transfers between levels during the three months ended March 31, 2013 and 2012, respectively.

Fair value of debt

The table below summarizes the fair value and carrying value as of March 31, 2013 and December 31, 2012.

	March 31, 2013				December 31, 2012
	Carrying value		Fair  value		Carrying  value		Fair value
Senior secured notes (a)	$	666,768	$	703,968	$	666,538	$	700,963
Catalyst leases (b)	44,780		44,780		43,442		43,442
	711,548		748,748		709,980		744,405
Less - Current maturities	—		—		—		—
Long-term debt	$	711,548	$	748,748	$	709,980	$	744,405

(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 senior secured notes.

(b) Catalyst leases are valued using a market approach based upon future commodity prices for similar instruments quoted in active markets and is classified as a Level 2 measurement.