2020 Summary

Annual Report

www.valero.com

VALERO SUMMARY ANNUAL REPORT • 1

 Our Products Fuel ADVAN CIN G T HE FUT UR E OF...
Moder n Life

Petroleum-based products surround us

in our daily lives. Whether at home, on
the road, at the office, in hospitals, in the ME D I C I NE TEC H NOL OGY ADVENT URE
classroom or in the great outdoors, Valero's
products help make our lives better.

MEDICAL EQUIPMENT:
• Surgical tools
• Polyester face masks and scrubs
• X-Rays and MRIs
• Breathing masks

SCHOOL SUPPLIES:
• Paper, pens and crayons
• Chalk and chalkboards
• Playground equipment
• Rulers, scissors, glue and tape
P E R F O R M ANC E L E ARNING L EIS URE
HOUSEHOLD ITEMS:
• Laundry detergent and baskets
• Televisions
• Refrigerators and food containers
• Toys

TECHNOLOGY:
• Keyboards and mouse pads
• iPads
• Mobile phones
• Ear buds

T H E W O R K SPAC E L IFE AT H OME GRE AT DRIVES

• Gaming systems and controllers

OUTDOOR EQUIPMENT:
• Camping and hiking gear
• Waterproof apparel
• Plastic coolers
• Bathing suits, sunglasses and umbrellas
• Sporting goods

2 VALERO SUMMARY ANNUAL REPORT • 3

 Contents
2020
Summary
7 F i n a n c ia l S u m mary Annual
8

10
M e s s a g e t o o u r S to c kh o ld e rs

C o m p a n y S u mmary
Report
12 M a p o f O p e r a tio n s

14 G u id in g P r i n c i p le s & Vale ro V isio n

16 E n v iro n m e n t a l, S o c ial &

G o v e r n a n c e ( E S G)
2 0 A d v a n c in g t h e F u tu re o f En e rg y
20 I n n o v a t i on
24 C a p i t a l Disc ip lin e
3 0 U n m a t c he d Exe c u tio n
Please visit www.valero.com to learn more about
our company. The terms “Valero,” “we,” “our”
and “us,” when used herein, may refer to Valero
Energy Corporation (NYSE: VLO), to one or more
of our consolidated subsidiaries, or to all of them
taken as a whole.

3 4 B o a rd o f D ire c to rs

3 6 E x e c u t i v e Te a m

3 8 N o n - G A A P D isc lo su re s

Albert City, Iowa, Ethanol Plant

4 VALERO SUMMARY ANNUAL REPORT • 5

 Be st - i n-c las s producer
o f f u e ls an d produc t s
Grow t h t hrough
in n ov ation in
Financial
t h a t are essenti a l re n e w ab le s Summary
t o m o der n l i fe

Increasing Re n e wa b l e 2020 2019

Die s e l production
Revenues $ 64,912 $ 108,324

R e new able Ref ining A dvancing Re n e wa b l e

Operating Income (Loss) $ (1,579) $ 3,836
D ies e l Naph th a production

Net Income (Loss) Attributable to Valero Stockholders $ (1,421) $ 2,422

Developing
E th a no l W ho les ale S u s tain able Aviati on
Earnings (Loss) Per Common Share – Assuming Dilution $ (3.50) $ 5.84
F u e l (S AF )

Total Assets $ 51,774 $ 53,864

M idstrea m Developing Re n e wa b l e
Hydroge n
Total Valero Stockholders’ Equity $ 18,801 $ 21,803

Evaluating additiona l Cash and Cash Equivalents Included in Current Assets $ 3,313 $ 2,583
Carbon S e qu e s tra t i on
opportunities
Dividends per Common Share (year ended December 31) $ 3.92 $ 3.60

Cautionary Statement Regarding Forward-Looking Statements Capital Investments Attributable to Valero1 $ 1,965 $ 2,633
This summary annual report contains forward-looking statements made by Valero or management intended to be covered by the safe-harbor provisions under federal securities laws. These
statements discuss future expectations, contain projections of results of operations or of financial condition or state other forward-looking information. You can identify forward-looking statements
by words such as “plan,” “should,” “strive,” “pursue,” “intend,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “could,” “would,” “track,” “continue,” “poised,” “focused,” “seek,”
“opportunity,” “scheduled,” “may,” “will,” “targeting,” or other similar expressions that convey the uncertainty of future events or outcomes. These forward-looking statements are not guarantees Amounts in millions of dollars, except for per share amounts.
of future performance and are subject to risks, uncertainties and other factors, some of which are beyond the control of Valero and are difficult to predict including, but not limited to, the effect,
impact, potential duration or other implications of the COVID-19 pandemic and various events arising therefrom. These statements are often based upon various assumptions, many of which are This is only a financial summary. The company’s full, audited financial statements are
based, in turn, upon further assumptions, including examination of historical operating trends made by the management of Valero. Although Valero believes that the assumptions were reasonable
when made, because assumptions are inherently subject to significant uncertainties and contingencies, which are difficult or impossible to predict and are beyond its control, Valero cannot give contained in its Annual Report on Form 10-K for the year ended Dec. 31, 2020, which
assurance that it will achieve or accomplish its expectations, beliefs or intentions. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary has been filed with the U.S. Securities and Exchange Commission and made available
statements contained in Valero’s filings with the Securities and Exchange Commission, including Valero’s annual report on Form 10-K, quarterly reports on Form 10-Q, and other reports available on
Valero’s website at www.valero.com. These risks could cause the actual results of Valero to differ materially from those contained in any forward-looking statement.
to all stockholders. This information is also available at www.valero.com.
Non-GAAP Financial Measures
This summary annual report includes certain financial measures that are not defined under U.S. generally accepted accounting principles (“GAAP”) and are considered to be non-GAAP measures.
Valero has defined these non-GAAP measures and believes they are useful to the external users of its financial statements, including industry analysts, investors, lenders, and rating agencies. Valero
believes these measures are useful to assess its ongoing financial performance because, when reconciled to their most comparable U.S. GAAP measures, they provide improved comparability
between periods after adjusting for certain items that Valero believes are not indicative of its core operating performance and that may obscure its underlying business results and trends. These
non-GAAP measures should not be considered as alternatives to their most comparable U.S. GAAP measures nor should they be considered in isolation or as a substitute for an analysis of Valero’s
results of operations as reported under U.S. GAAP. In addition, these non-GAAP measures may not be comparable to similarly titled measures used by other companies because Valero may define
them differently, which diminishes their utility. Valero’s reconciliations of GAAP financial measures to non-GAAP financial measures are located at the end of this summary annual report.

1
See pages 38-39 for non-GAAP disclosures.

6 VALERO SUMMARY ANNUAL REPORT • 7


Message to our Stockholders
“ We rema in
st ea d fa st in o ur
st r a t eg y, p ur suin g
exc ellenc e in
o p er a t io ns w it h
a d isc ip lined c a pi ta l
a llo c a t io n fr a me w o r k ,
invest ing fo r
ea r ning s g ro w t h
t hro ug h inno va t i o n
a nd ho no r ing o u r
c o mmit ment t o
st o c kho ld er ret u r n s . ”
J o e G o rd er
C h a i r ma n a n d
C h i e f E x e cu t i v e O ff i ce r
8 VALERO SUMMARY ANNUAL REPORT •
The COVID-19 pandemic had an extraordinary
impact on families, communities and businesses
across the globe. Our industry, like so many
others, faced unprecedented challenges but
I am incredibly proud of Team Valero for their
dedication to keeping our company moving
forward, making products that people depend
on in our country and across the globe.
Valero, considered part of the country’s critical
infrastructure, kept operating safely throughout
the pandemic and honored our long-standing
commitments to safety, environmental
stewardship, our communities and our
stockholders during this time. Our focus on
safety, combined with investments in reliability
and environmental stewardship, provide the
foundation for our operations excellence.
In fact, we achieved several operational records
last year, delivering our best year ever in
safety and environmental performance. This
dedication is what makes Valero a best-in-
class producer of fuels and products that are
essential to modern life.
Valero entered the economic downturn in
a position of strength, and our team was
thorough, decisive and swift in its operational
and financial response. Operationally, we
adjusted the throughput rates at our refineries
to more closely match product supply with
demand to ensure that our supply chain did
not become physically infeasible. We also
temporarily idled a number of our ethanol
plants and reduced the amount of corn
feedstock processed at the remaining plants
to address the decreased demand for ethanol.
Financially, we remained well capitalized. We
entered into a new $875 million revolving
credit facility and raised $4 billion of debt at
attractive rates for additional liquidity. We also
temporarily suspended buybacks in mid-March
and reduced our capital budget by over
$500 million while keeping our high return,
low-carbon projects moving forward. Through
all of this we never wavered in our commitment
to stockholders. Valero returned $1.8 billion to
our owners, while maintaining its dividend and
investment grade credit ratings, ending the
year with over $3 billion of cash and more than
$9 billion of total available liquidity.
Despite the challenges and hardships through
the pandemic, I was encouraged to see
individuals selflessly helping and stepping up to
support those in need. In this spirit of giving, I
am proud that Valero continued to support the
communities where we operate, with employee
volunteerism and more than $58 million in
charitable contributions, including COVID-19
relief funding – for food, shelter, educational
resources and other life necessities.
Recognizing the world wants cleaner fuels, and
consistent with our long-standing commitment
to sustainability, we shared our plan to reduce
and offset 63% of refining greenhouse gas
(GHG) emissions by 2025. And we have
line of sight to this target with projects that
have been approved by the Board and are
already in execution. These renewable energy
projects reduce the carbon intensity of our
products while earning attractive returns to
further strengthen our long-term competitive
advantage.
We also made significant progress on our
international strategy to expand our product
supply chain into higher growth markets with
the start of waterborne product shipments to
the new Veracruz terminal, making Valero one
of the largest fuel importers into Mexico.
Our framework served us well during a
challenging 2020 just as it has in previous years,
and we’ll continue to adhere to it in the future.
We remain steadfast in our strategy, pursuing
excellence in operations with a disciplined
capital allocation framework, investing for
earnings growth through innovation and
honoring our commitment to stockholder
returns.
Thank you for your continued support and trust.
On behalf of Team Valero, may you and your
loved ones be blessed.
9
 Company
Summary

WO R LD’S LAR GE S T INDE P E NDE NT R EF I NER

Val ero E n e rg y GROWTH PROJECTS FOCUSED ON COST CONTROL, OPTIMIZATION & MARGIN EXPANSION
Cor p or a t i o n , t h ro u g h
its subsidiaries, is
Lowest-cost
producer 3.2 million barrels per day of high-complexity
throughput capacity 15
REFINERIES
an international
man u f a c t u re r Advantaged refining and logistics Ratable million barrels per day

and marketer of
assets well-positioned for feedstock
and product optimization
wholesale
supply of
1.2 or more than 50% of our
light products
transportation fuels
a n d p et ro c h e m i c a l
Valero
p rod uct s .
Energy WO R LD’S 2 ND LAR GE S T R ENEWAB LE D I ES EL PR OD U CER
HIGH RETURN PROJECTS WITH PRODUCTS PLACED INTO HIGH GROWTH, LOW-CARBON MARKETS
Valero is based in San Antonio, Texas,
and operates 15 petroleum refineries
Corporation Expanding to 1.2 billion gallons per year Low-carbon intensity renewable diesel
290
MILLION
produced from recycled animal fats,
has three
with a combined throughput capacity GALLONS
reduction in life cycle
of approximately 3.2 million barrels Up to
80% GHG emissions used cooking oil and inedible corn oil PER YEAR
per day and 13 ethanol plants with a
combined production capacity of reportable compatible with existing
100% engines and infrastructure
1.7 billion gallons per year.

Valero is also a joint venture partner in

segments. WO R LD’S 2 ND LAR GE S T C OR N ET H ANOL PR OD UC ER
Diamond Green Diesel (DGD), which
DEVELOPING ECONOMIC PROJECTS TO FURTHER REDUCE CARBON INTENSITY
owns and operates a renewable diesel
plant next to Valero's St. Charles
1.7 billion gallons per year
production capacity
High-octane renewable fuel with
lower CO2 emissions
13
refinery in Louisiana. ETHANOL
PLANTS
reduction in life cycle
Up to
30% GHG emissions Existing logistics assets well-positioned
to support export growth

10 VALERO SUMMARY ANNUAL REPORT • 11

 Map of Operations

UNITED
REFININ G KINGDOM

Assets: 15 petroleum refineries in the U.S., IRELAND

Canada and the U.K.

Gasoline, diesel, jet fuel and other specialty products, PEMBROKE LONDON
Products: including asphalt and petrochemicals, that fuel
modern life

Throughput 3.2 million barrels per day of crude oil

Capacity: and other feedstocks
LOGI STICS ASSETS

~3,000 miles of active pipeline

RENEWABL E D IE S E L ~130 million barrels of active shell
capacity for crude oil and products
Diamond Green Diesel (joint venture), 200+ truck rack bays
Assets:
Norco, Louisiana

~5,200 railcars
Products: Renewable diesel fuel 50+ docks
2 Panamax-class vessels

Includes assets that have other joint venture or

Capacity: 290 million gallons per year minority interests. Does not include ethanol assets,
except for railcars.

ETHANOL ALT ER NATI VE ENER G Y GENERATION

33 wind turbines with 50 megawatts
Assets: 13 plants in mid-continent U.S. of electricity capacity to help power
the McKee refinery in the Texas
Panhandle
Ethanol, distillers grains and fuel-grade
Products: corn oil
4 cogeneration plants in the U.S.
and the U.K.

Capacity: 1.7 billion gallons per year of ethanol;

4.5 million tons of distillers grains PERU LIMA

12 VALERO SUMMARY ANNUAL REPORT • 13

 Guiding Principles
OUR VISION
T h e wo r l d
req u i re s re l i a b l e ,
a ff ord a b l e a n d
s us t ai na b l e
e n e rg y, a n d w e
s ee t hi s a s a n
o p p o r t u n i t y.
We are c o m m i t t e d
t o ad va n c i n g
t h e f ut u re o f
e n e rg y t h ro u g h
i nn o va t i o n ,
i ng e n u i t y a n d
u n mat ch e d
e x e cu t io n .
14
SAFETY
Safety is our foundation for success.
E NV I R O N M E N T
We are committed stewards of the environment.
COMMUNITY
We will be a good neighbor by sharing our success with the
communities where we live and work through volunteerism,
charitable giving and the economic support of being a good
employer.
Valero committed $15 million to
Morgan’s Wonderland Camp for
EMPLOYEES children with and without special
We consider our employees a competitive advantage
needs to experience the world’s first
ultra-accessible challenge course
and our greatest asset. We foster a culture that supports
and zipline, as well as other camp
diversity and inclusion, and we provide a safe, healthy and
experiences.
rewarding work environment with opportunities for growth.
GOVERNANCE
We view our stakeholders as partners to whom we seek to
deliver operational excellence, disciplined management
of capital and long-term value on a foundation of strong
governance and ethical standards.
VALERO SUMMARY ANNUAL REPORT • 15
 ESG
ENVIRONMENTAL • World's 2nd largest renewable diesel producer

We b el i e v e t h a t p ro a c t ive
a n d con s i s t e n t d i a l o g u e
wi t h s t a k e h o l d e r s h e l p s
u s a d d re s s e n v i ro n m e n ta l ,
s oci a l a n d g o v e r n a n c e
p r i or i t i e s , w h i c h e n h a n ce
o u r b us i n e s s .
On track to achieve 63% refining GHG • Renewable diesel and ethanol reduce life cycle GHG emissions up to 80% and 30%, respectively
emissions reduction/offset target by 2025
• World's 2nd largest corn ethanol producer
2020 best year ever for environmental
• Growth projects in low-carbon fuels as well as carbon capture and storage
performance

SOCIAL
2020 best year ever for safety performance • 9,964 global employees1 • 29% of our global professional employees are women1
Surpassed $58 million in community donations • 35% of our U.S. workforce are minorities1 • Named to Forbes 2020 World’s Best Employers
and fundraising, with more than $12 million for
COVID-19-related support in 2020

Our Sustainability Accounting Standards

Board (SASB) report, which aligns Valero’s As of January 31, 2021.
1

performance data with the recommendations of

SASB’s framework in the Oil and Gas – Refining
and Marketing industry standard, can be found
on our website at www.valero.com > Investors
> ESG > Reports and Presentations.

In 2018, we published our Review of Climate- GOVERNANCE • Board and committee oversight of risks and compliance, including climate change risks, GHG reductions and
renewable fuels strategy
Related Risks and Opportunities assessing the
resilience of our business strategies under a
Diverse, independent Board of Directors:
• Compensation aligned with performance: all-employee bonus program includes ESG efforts and improvements;
potential transition to a lower-carbon economy
5 of 11 represent diversity of race or gender and executive performance shares include an Energy Transition performance measure (as a modifier to relative TSR)
consistent with a 2°C scenario. We intend to
3 of 11 are women • 10 are independent linking compensation to the company’s progress toward its publicly-announced GHG emissions reduction/offset target
present an updated report following the Task
3 fully independent committees and percentage of growth CAPEX deployed for low-carbon initiatives
Force on Climate-Related Financial Disclosures
(TCFD) recommendations later in 2021. We
are participating in the CDP Climate Change
Questionnaire 2021.

16 VALERO SUMMARY ANNUAL REPORT • 17

 Advancing the WITH CAPITAL DISCIPLINE, INNOVATION

Future of Energy
AND UNMATCHED EXECUTION

RELIABLE
Proudly keeping families
AFFORDABLE
and critical supplies moving
SUSTAINABLE around the world.
ENERGY

18 VALERO SUMMARY ANNUAL REPORT • 19

 ADVANCING T HE FUTURE OF ENERGY

Diamond Green Diesel at Valero's St. Charles Refinery

Innovation

Bui l d i ng Global low-carbon fuel policies

u p o n Va l e ro ’s are driving demand for renewable

e x p e r t is e , w e diesel, and we are making great R ENEWAB LE DIESEL

a re l e ve r a g i n g progress on an expansion of our We are C APAC I TY
Diamond Green Diesel (DGD) joint Mi l l i o n gal l o n s pe r ye ar
our global
venture plant located next to our rei nves ti ng
liquid fuels DGD 1 : Exi sti n g S t. C h arles p lant
DGD 2 : Expan si o n o f e xi s ting p lant
1,160
St. Charles refinery in Louisiana.
p l at f o r m capi tal DGD 3 : Ne w Po rt A rth u r p lant
This expansion is slated for
t o cont i n u e
completion in 2021 and is expected 470
expanding to increase production capacity by wi th
our long-term 400 million gallons per year to a
co mp et i t i v e total production capacity of di vers i f i cati on $725 MM
Cap ex
a d va n t a g e w i t h 690 million gallons per year.
i nve s t m e n t s i nto hi gher 400

i n eco n o m i c DGD also announced a new

l ow- ca r b o n renewable diesel plant to be growth, hi gher 160 115 15 $550 MM

Cap ex
located next to our Port Arthur
transportation
f u e l s p ro j e c t s . refinery. Once this plant is retur n and
complete, DGD's total renewable 2013 2018 2020 2021 2023 2023
diesel capacity is expected to be l ower carbon DGD 1 DGD 1 DGD
O pt i mization
DGD 2 DGD 3

1.2 billion gallons per year. We Port

Arthur,
believe this will strengthen Valero's renewabl e St. Charles, LA TX
long-term competitive advantage
in a low-carbon transportation f uel s . Di amo n d Gre e n Di e se l Cap ex reflects Valero's 50% s hare.
fuels world, further solidifying our
position as the world's second-
largest renewable diesel producer.

20 VALERO SUMMARY ANNUAL REPORT • 21

 ADVANCING T HE FUTURE OF ENERGY

S i nce 2 009, w e h a v e i n vested more tha n $3 b i l l i on* i n

o u r re n e w a b l e f u e l s b u si nesses, a nd we a re ex p l ori ng
a d d i t i o n a l g ro w t h o p p ortuni ti es, i nc l ud i ng our rec entl y
a n n o u n c e d c a r b o n s e q u estra ti on proj ec t wi th Bl a c k Roc k
a n d Na v i g a t o r.

We are working with BlackRock and Navigator to
develop an industrial-scale carbon capture and
storage system in the U.S. Midwest that would
capture and store carbon dioxide (CO2) from
eight of Valero’s ethanol plants, lowering the
carbon intensity of the ethanol product.
Also, we are expanding our renewable naphtha
production capacity, and sustainable aviation fuel
(SAF) is under development.
Valero is targeting to reduce and offset 63% of
our refining GHG emissions by 2025 through
investments in Board approved projects.

ABS O L UT E RE D UC T I O NS A N D O F F S E T S T HR O U G H Reduce and offset

E X IS T IN G BO ARD A P P R O V E D P R O J E C T S

31.8
1 .4
4.7 63%
5.9
63% Reduc tion of refining GHG
Million Metric
To ns CO 2 e 7.9
emissions by 2025

11.9

Refi ni ng Abs ol ute GHG GHG GHG Refining GHG

G HG E m i s s i ons Emissions Emissions Em i s s i o n s Emissions in
E m i s s i ons Reduc t i on Off s e t b y Off s e t b y Off s e t b y 2025 after
i n 2011 through Ethanol Renewable Global Reductions
(S c ope 1 & 2) E ffi c i enc i es Pro d u c t i o n Diesel C re d i t s f o r & & Off s e t s
( Sc ope 1 & 2) P ro d u c t i o n Bl e n d i n g o f ( S c o p e 1 & 2 )
Renewable
Fuels

*Our investment to date in our renewable fuels businesses consists of $1.4 billion in capital investments to build our renewable
diesel business and $1.7 billion to build our ethanol business. Capital investments in renewable diesel represent 100 percent of
the capital investments made by DGD.

22 VALERO SUMMARY ANNUAL REPORT • 23

 ADVANCING T HE FUTURE OF ENERGY

Capital
Discipline

Even t h o u g h 2020 w a s a yea r l i k e

n o ot he r, Va l e ro ’s d i s c i pl i ned c a p i ta l
man a g e m e n t f r a m e w o r k wa s the
s t ro n g f o u n d a t i o n t h a t k ep t us movi ng H I GH EST FREE CASH
f o r ward a n d re m a i n s a consta nt i n our F LOW WITHIN PEER
s t r at e g y. We have a l ong- GR OUP

Valero remains focused on maintaining a strong balance sheet, term s us tai nabl e $ 2 . 2 billio n 1
with investment grade credit ratings.
com peti ti ve
Our premier refining portfolio is resilient even in a carbon-
constrained scenario. We have a long-term sustainable advantage
competitive advantage with the highest free cash flow within our
Average Free
peer group. wi th the hi ghes t Cash Flow
Peer Range
Valero’s non-discretionary expenditures included sustaining 2012-2020
capital spending as well as the common stock dividend. We
f ree cas h f l ow
target approximately $1.5 billion annually to sustain our operations,
including costs for turnaround maintenance, catalysts and
wi thi n our
$0
regulatory compliance. These investments are key to safety and
reliability, and were demonstrated in 2020 with our best year ever
peer group.
Peer group includes
for safety and environmental performance. PSX, MPC, HFC and PBF

1
See pages 38-39 for non-GAAP disclosures.

Three Rivers Refinery

24 VALERO SUMMARY ANNUAL REPORT • 25

 ADVANCING T HE FUTURE OF ENERGY

Corpus Christi Refineries

I n 2 0 2 0, For growth capital, we look for a 25% after-tax internal rate of return for
Val ero projects. In our refining business, projects are focused on operating costs

remai ne d control, market expansion, and margin improvement. For acquisitions, we

always evaluate each opportunity versus alternative uses of cash.
co mm i tt e d
to its Combined with common stock dividends, we target stock buybacks to
s t ockh o l d e r s . achieve a long-term payout ratio of 40% to 50% of adjusted net cash
provided by operating activities. Our stock buyback program consists of
Val ero’s ratable and opportunistic purchases.
d i s cret i o n a r y
e x p e n d i t u re s E S T IMAT E D C A P I TA L I NV E S T M E NT S
a re cen t e re d AT T RI B U TA B L E T O VA L E R O * Over the years, S& P 500 F R EE CASH FLOW
u p o n t h re e VOLAT I LI TY AND RETURN PROFILE
$2.0 BILLION FOR 2021 Valero has
a rea s : g ro w t h 2012- 2020
ca p i t al ,
demonstrated
10% BEST
a cq u i s i ti o n s lower volatility Financials

8%
and stock 60%
Sustaining
Growth
40%
Renewables
Other Growth
> 50%
in earnings Free Cash Communication Services
Industrials
b u yb a ck s . Flow as a 6% Refining Peers
and free cash Percentage of
IT
Consumer Discretionary
Market Cap 4% Health Materials
flow than other (Average Trailing
Care
Consumer Staples
Twelve Months) 2% Oil Majors
Total Capital Investments Growth Capital Investments
Attributable to Valero Attributable to Valero refiners, integrated Energy
0%
companies and Real Estate
Utilities
- 2% WORST
AN N U A L DI V I DE N D P E R S HA R E & W E I GH TED most S&P 500 0% 100% 200% 300% 400%
AV E R A G E S HA R E S O U T S TA NDI N G ( WA SO) sectors. Free Cash Flow Volatility
AS PERCENTAGE RELATIVE TO 2012

556 mi l l i o n s h a re s
100% 99%
95% See page 38-39 for non-GAAP disclosures. Average free cash flow reflects 2012 through
90% the most recent annual filing. Average free cash flow for PBF reflects years 2013 to 2020
83% due to its December 2012 IPO. Volatility expressed as coefficient of variance, or the
80% 4 07 mi l l i o n sh are s standard deviation divided by the mean, of the respective metric on a quarterly basis from
77%
74% 73% the first quarter of 2012 through the fourth quarter of 2020. Refining peer group includes
WASO PSX, MPC, HFC and PBF. Oil majors include XOM, CVX, COP and EOG.

Dividend per share $3.92

$3.60
$3.20
$2.80
*See page 38-39 for non- $2.40
GAAP disclosures.
$1.70

$1.05
$0.85
$0.65

26 2012 2013 2014 2015 2016 2017 2018 2019 2020 VALERO SUMMARY
VALERO SUMMARY ANNUAL REPORT • 27
 ADVANCING T HE FUTURE OF ENERGY

Wilmington Refinery

STOC KHOLDER
Valero D I VI D ENDS
In billions
$1.6
targets a $1.1 $1.2
$1.4 $1.5

sustainable
and gro wing
dividend 2016 2017 2018 2019 2020

with a
D I VI D END YIELD
payo ut at
the high end 4.8%
E n e rg y 4 . 0 %
o f the peer U ti l i ti e s 3 . 1 %

gro up. R e a l E s ta te 2 . 6 %
Consumer
Staples 2.5%
M a te ri a l s 1.7%
In 2 0 2 0 , we Financials 1.6%
retur ned Health Care 1.6%
S&P 500 1.4%
$ 1 .6 billio n I n d u s tri a l s 1.3%
thro ugh o ur Tech 0.9%

dividend. Cons. Disc.

Comm.
0.8%
0.7%
Services

Dividend yield for sectors reflects the Index Yield of the respective
SPDR exchange-traded fund (ETF), as of May 14, 2021.

28 VALERO SUMMARY ANNUAL REPORT • 29

 ADVANCING T HE FUTURE OF ENERGY

Unmatched Execution
with a proven history of
operations excellence

Des p i t e t h e c h a l l e n g e s of 2020, Va l ero’s

co mm i tm e n t t o s a f e t y, rel i a b i l i ty a nd
e n vi ron m e n t a l s t e w a rd s hi p never wa vered .

In 2020, Valero delivered its best year ever on safety performance and had the
lowest number of environmental events in company history.

Investments in reliability are critical to operations excellence. This results in fewer

unplanned shutdowns, ensuring safe, reliable and environmentally responsible PER S ONNEL S AF ETY *
operations, a foundation for Valero’s profitability.
Valero
Valero’s improvement versus industry benchmarks has led to Industry
Greater Margin Capture, Lower Operating Expenses and Better Efficiency* 0.90
Improvement in Improvement in Improvement in Non- 0.68
Personnel Index Maintenance Index Energy Cash Opex
*Industry
0.40
1st Q ua rti l e benchmarking
and Valero's
Total
2nd Q ua rti l e 2018 performance
Recordable 0.23
statistics from
Incident Rate
3rd Q ua rti l e (TRIR)
Solomon
4 th Qua rti l e 2008 Associates and
Valero.
2010 2012 2014 2016 2018 2020

Increased mechanical availability – the percentage of time our refineries are available to
operate – continues to deliver excellent reliability and has driven Valero to be the lowest Refining Industry Employees
cost producer in the industry, with a 97.2% mechanical availability in 2020. (U.S. Bureau of Labor Statistics)

Improvement in Mechanical Availability Refining Cash Operating Expenses

Versus Industry Benchmarks per Barrel of Throughput
(excludes turnaround and D&A expenses) *Industry TRIR from U.S. Bureau of Labor Statistics. Valero TRIR includes
1 st Q ua rti l e $7.00 refining employee and contractor data.
**Peer group
2nd Q ua rti l e includes
Peer
Range** PSX, MPC, HFC
3 rd Q ua rti l e
and PBF
4th Q ua rti l e
$3.00
2010 2012 2014 2016 2018 2020

2018 2008

30 VALERO SUMMARY ANNUAL REPORT • 31

 ADVANCING T HE FUTURE OF ENERGY

Val ero i s a b e s t - i n - c l a s s
p rod uce r o f f u e l s a n d
p rod uct s e s s e n t i a l t o
mod er n l i f e .

Key L ocation s & O perati o nal Fl exi bi l i ty &

Ex p ort De man d s Refi nery O pti m i z ati o n s
Valero has a strong presence in the U.S. Gulf Coast and Mid-Continent along Valero has the operational flexibility to process a
with advantaged crude supply in these markets. wide range of feedstocks.

As markets such as Latin America, the Caribbean, Eastern Canada, Europe This flexibility, along with the ability to
and Africa work through their economic recovery and face potential energy optimize operations and shift product yields as
shortages, Valero is poised to help meet the anticipated U.S. export demand. market conditions change, gives Valero more
opportunities to improve margin even through
Exports to Latin America comprise 85% of total U.S. product exports. Valero
challenging times.
continues to expand the supply chain into these high demand markets, such
as Mexico, by investing and growing a flexible logistics supply system.

VA LERO REFIN IN G C APAC IT Y VA L E R O ' S M E XI C O W HO L E S A LE GULF C OAST F EED STOC K 2012- 2020 REFINERY PRODUCT
2 . 6 MIL L ION BARRELS PER D AY VOLUME GROWTH R ANGES (2012 through Q1 2021) Y I ELD R ANGES (monthly averages)
(thousand barrels per day) Valero
54% 59% 40%
60 Industry 38%
230 (9%) U.S. West Coast
50 51%
440 (17%) 34% 34%
North Atlantic 40
12% 11%

461 (17%) U.S. Mid-Continent 30

Valero has become 23%
one of the largest light products 20
U.S. Gulf importers into Mexico. 10
1,484 (57%) Coast 17% 17%
0 8% 27%
6% 42% 41% 4%
Au g D ec Apr Aug D ec Apr Aug Dec Apr 2% 23%
MBPD, % of overall crude capacity. 2018 2 018 2019 2019 2019 2020 2020 2020 2021 Heav y Medium/ Sweet Res iduals Finis hed Ke ro se n e / J e t Die se l
Sour Light Sour G as oline
Ranges represent average quarterly minimums and maximums Monthly industry refinery yields from EIA through February 2021.
of each feedstock category as a % of total feedstock. Ranges for
32 monthly averages are wider. VALERO SUMMARY ANNUAL REPORT • 33
 St. Charles Refinery

Board of Directors

Joe Gorder Kimberly S. Greene

H. Paulett Eberhart
Chairman of the Board Chair, CEO and
Chair and CEO,
and CEO, Valero
HMS Ventures
President, Southern 1 1 MEMBERS
Energy Corporation Company Gas

10
independent
Sen. Don Nickles
Deborah P. Majoras
Eric D. Mullins Retired U.S. Senator
Chief Legal Officer and

5 of 11
Chairman and CEO, (R-Okla.) and Chairman
Secretary, The Procter
Lime Rock Resources and CEO, The Nickles
& Gamble Company
Group

directors represent diversity

of race or gender
Stephen M. Waters

3 of 11
Robert A. Profusek
Philip J. Pfeiffer Managing Partner,
Partner and Practice Compass Partners Capital
Of Counsel, Norton
Leader, Global Mergers and Compass Partners
Rose Fulbright LLP,
and Acquisitions, Advisers LLP; former
San Antonio
Jones Day CEO, Compass Partners
European Equity Fund directors are women

Randall J.
Weisenburger Rayford
Managing Member,
Wilkins, Jr.
Mile 26 Capital LLC; Former CEO-Diversified
former EVP and CFO, Businesses, AT&T Inc.
Omnicom Group Inc.

34 VALERO SUMMARY ANNUAL REPORT • 35

 Executive Team
Jason Fraser
Joe Gorder Lane Riggs
Executive Vice
Chairman of the Board President and Chief
President and Chief
and CEO Operating Officer
Financial Officer

Eric Fisher Rich Lashway

Gary Simmons
Senior Vice President - Senior Vice President -
Executive Vice
Wholesale Marketing and Corporate
President and Chief
International Commercial Development and
Commercial Officer
Operations Strategy

Martin Parrish Julia Rendon

Mark Schmeltekopf
Senior Vice President - Reinhart
Senior Vice President
Alternative Energy Senior Vice President and Chief Accounting
and Project and Chief Human Officer
Development Resources Officer

Cheryl Thomas Rich Walsh Homer Bhullar

Senior Vice President Senior Vice President, Vice President -
and Chief Technology General Counsel and Investor Relations and
Officer Secretary Finance

Greg Bram
Eric Honeyman John Locke
Vice President -
Vice President - Vice President and
Supply Chain
Refining Operations Treasurer
Optimization

Valero Headquarters

36 VALERO SUMMARY ANNUAL REPORT • 37

 Non-GAAP Disclosures

Year ended December 31

Free Cash Flow Capital investments attributable to Valero
VLO defines free cash flow as net cash provided by VLO defines capital investments attributable Reconciliation of Total Capital
operating activities less capital expenditures, deferred to Valero as all capital expenditures, deferred Investments to Capital Investments 2020 2019
turnaround and catalyst cost expenditures, investments turnaround and catalyst cost expenditures, and Attributable to Valero (in millions)
in joint ventures, and changes in current assets and investments in unconsolidated joint ventures
liabilities. VLO believes that the presentation of free cash presented in VLO’s consolidated statements of Capital expenditures (excluding VIEs) $ 1,014 $ 1,627
flow provides useful information to investors in assessing cash flows excluding the portion of DGD’s capital
VLO’s ability to cover ongoing costs and VLO’s ability Capital expenditures of VIEs:
investments attributable to our joint venture partner
to generate cash returns to stockholders. The GAAP and all of the capital expenditures of other VIEs.
DGD $ 523 $ 142
measures most directly comparable to free cash flow are
net cash provided by operating activities and net cash VLO is a 50/50 joint venture partner in DGD and
Other VIEs $ 251 $ 225
used in investing activities. consolidate DGD’s financial statements; as a
result, all of DGD’s net cash provided by operating Deferred turnaround and catalyst cost
$ 623 $ 762
activities is included in VLO’s consolidated net cash expenditures (excluding VIEs)
provided by operating activities. DGD’s partners Deferred turnaround and catalyst cost
Reconciliation of Net Cash expenditures of DGD
$ 25 $ 18
use DGD’s operating cash flow (excluding changes
Provided by Operating
in its current assets and current liabilities) to fund its
Activities Under GAAP to 2012 2013 2014 2015 2016 2017 2018 2019 2020 Investments in unconsolidated joint ventures $ 54 $ 164
Free Cash Flow (unaudited, in capital investments rather than distribute all of that
millions) cash to themselves. Because DGD’s operating cash Total capital investments $ 2,490 $ 2,938
flow is effectively attributable to each partner, only
Net cash provided by operating 50 percent of DGD’s capital investments should be Adjustments:
$ 5,270 $ 5,564 $ 4,241 $5,611 $ 4,820 $ 5,482 $4,371 $ 5,531 $ 948
activities
attributed to VLO’s net share of capital investments.
DGD's capital investments attributable to
Less: Capital expenditures $ 2,931 $ 2,121 $2,153 $ 1,618 $1,278 $ 1,353 $1,628 $1,769 $1,537 VLO also excludes the capital expenditures of $ (274) $ (80)
our joint venture partner
other consolidated VIEs because VLO does not
Less: Deferred turnaround and
catalyst cost expenditures
$ 479 $ 634 $ 649 $ 673 $ 718 $ 523 $ 915 $ 780 $ 648 operate those VIEs. VLO believes that capital Capital expenditures of other VIEs $ (251) $ (225)
investments attributable to Valero is an important
Less: Investments in joint ventures $ 57 $ 76 $ 14 $ 141 $ 4 $ 406 $ 181 $ 164 $ 54 measure because it more accurately reflects capital Capital investments attributable to Valero $ 1,965 $ 2,633

investments of VLO.
Less: Changes in current assets and
$ (302) $ 922 $ (1,810) $ (1,306) $ 976 $ 1,289 $ (1,297) $ 294 $ (345)
current liabilities

Free cash flow $ 2,105 $ 1,811 $ 3,235 $ 4,485 $ 1,844 $ 1,911 $ 2,944 $2,524 $ (946)

Total free cash flow, 2012-2020 $ 19,913

Number of years 9
Average free cash flow, 2012-2020 $ 2,213

38 VALERO SUMMARY ANNUAL REPORT • 39

C aring ab o u t th e
e n vironme n t, o u r
e m pl oye e s a n d
the comm u n itie s
wh ere we liv e
a nd work .

Valero Energy Corpo r a t io n P. O . Bo x 6 9 6 0 0 0 , S a n A n to n i o , TX 7 8 2 6 9

40 Printed in the U.S.A.