Western Refining Inc. Reports Record Second Quarter Results

Business Wire, August 8, 2006

EL PASO, Texas -- Western Refining Inc. (NYSE:WNR) today reported record quarterly net income of $86.5 million, or $1.29 per diluted share, for the quarter ended June 30, 2006, compared to pro forma net income of $40.4 million for the same period in 2005. The Company's second quarter 2006 results represent the highest quarterly net income in its history. For the six months ended June 30, 2006, the Company had net income of $66.8 million, or $1.04 per diluted share, compared to pro forma net income of $41.4 million for the same period in 2005. The pro forma net income amounts reflect an adjustment for income taxes resulting from changing to a corporate holding company structure from an operating partnership.

The increased earnings were primarily a result of higher refinery gross margins and increased refinery throughput. Refinery gross margin per barrel was $15.21 for the quarter ended June 30, 2006, compared to $9.21 for the same period in 2005, an increase of 65.1%. Total refinery throughput for the second quarter of 2006 was 131,980 barrels per day, which included 116,826 barrels per day of crude oil. Total refinery throughput for the second quarter of 2005 was 119,224 barrels per day, which included 108,086 barrels per day of crude oil.

Adjusted earnings before interest, taxes, depreciation, amortization and maintenance turnaround expense ("Adjusted EBITDA") for the quarter ended June 30, 2006, was a record $130.8 million versus $66.4 million for the same quarter in 2005. Adjusted EBITDA was $160.4 million for the six months ended June 30, 2006, compared to $77.0 million for the same period in 2005.

Capital expenditures for the three months ended June 30, 2006, totaled $37.0 million primarily related to the purchase of an asphalt plant and three asphalt terminals from Chevron U.S.A. Inc. and spending for the Company's acid and sulfur gas plant and hydrogen plant. The Company ended the quarter with $183.5 million of cash and had no outstanding debt at June 30, 2006.

Western's President and Chief Executive Officer, Paul Foster, commented, "We are extremely pleased with our record performance during the quarter. I firmly believe that some of our accomplishments during the first quarter of this year positioned us to take advantage of the strong refining margin environment that we experienced in the second quarter of 2006. During the first quarter of 2006, we successfully completed a major maintenance turnaround on the south side of our refinery, and we completed the first phase of our crude expansion. As a result, with no planned maintenance activity, our refinery was fully operational during the second quarter. For the remainder of the year, we do not have any planned maintenance turnaround activity. Additionally, we completed our new diesel hydrotreater during the first quarter and began to ship ultra-low sulfur diesel fuel as planned on June 1, 2006.

"Also during the second quarter, we acquired an asphalt plant in El Paso, and asphalt terminals located in Phoenix, Tucson and Albuquerque. This purchase fits well with our outlook for strengthening asphalt margins. Strategically, it also provides a future outlet for our increased asphalt production when we have the capability of increasing our processing of sour crude oil by the end of 2007.

"We continue to focus on safe and reliable operations at our refinery, and I am pleased to say that our stellar record of safety and reliability at the refinery continued during the second quarter," Foster said.

A conference call is scheduled for August 9, 2006 at 11:00 a.m. EDT to discuss these financial results. This call is being webcast by CCBN and can be accessed at Western's website, www.westernrefining.com. The call can also be heard by dialing 866-831-6270, passcode: 29054890. The audio replay will be available through August 23, 2006, by dialing 888-286-8010, passcode: 35992263.

Western Refining Inc., headquartered in El Paso, Texas, is an independent crude oil refiner and marketer of refined products, operating primarily in the Southwest region of the United States, including Arizona, New Mexico and West Texas.

Any statements in this press release that are not statements of historical fact are forward-looking statements. Forward-looking statements reflect the Company's current expectations regarding future events, results or outcomes. These expectations may or may not be realized. Some of these expectations may be based upon assumptions or judgments that prove to be incorrect. In addition, the Company's business and operations involve numerous risks and uncertainties, many of which are beyond the Company's control, which could result in the Company's expectations not being realized or otherwise materially affect the Company's financial condition, results of operations and cash flows. Additional information regarding these and other risks are contained in the Company's filings with the Securities and Exchange Commission.