Valero Energy (VLO) 10-K risk factor changes: FY2014 vs FY2013

You should carefully consider the following risk factors in addition to the other information included in this report.

Each of these risk factors could adversely affect our business, operating results, and/or financial condition, as well as adversely affect the value of an investment in our common stock.

Our financial results are affected by volatile refining margins, which are dependent upon factors beyond our control, including the price of crude oil and the market price at which we can sell refined products.

Our financial results are primarily affected by the relationship, or margin, between refined product prices and the prices for crude oil and other feedstocks.

Historically, refining margins have been volatile, and we believe they will continue to be volatile in the future.

Our cost to acquire feedstocks and the price at which we can ultimately sell refined products depend upon several factors beyond our control, including regional and global supply of and demand for crude oil, gasoline, diesel, and other feedstocks and refined products.

These in turn depend on, among other things, the availability and quantity of imports, the production levels of U.S. and international suppliers, levels of refined product inventories, productivity and growth (or the lack thereof) of U.S. and global economies, U.S. relationships with foreign governments, political affairs, and the extent of governmental regulation.

Some of these factors can vary by region and may change quickly, adding to market volatility, while others may have longer-term effects.

The longer-term effects of these and other factors on refining and marketing margins are uncertain.

We do not produce crude oil and must purchase all of the crude oil we refine.

We may purchase our crude oil and other refinery feedstocks long before we refine them and sell the refined products.

Price level changes during the period between purchasing feedstocks and selling the refined products from these feedstocks could have a significant effect on our financial results.

A decline in market prices may negatively impact the carrying value of our inventories.

Economic turmoil and political unrest or hostilities, including the threat of future terrorist attacks, could affect the economies of the U.S. and other countries.

Lower levels of economic activity could result in declines in energy consumption, including declines in the demand for and consumption of our refined products, which could cause our revenues and margins to decline and limit our future growth prospects.

Refining margins are also significantly impacted by additional refinery conversion capacity through the expansion of existing refineries or the construction of new refineries.

Worldwide refining capacity expansions may result in refining production capability exceeding refined product demand, which would have an adverse effect on refining margins.

A significant portion of our profitability is derived from the ability to purchase and process crude oil feedstocks that historically have been cheaper than benchmark crude oils, such as Louisiana Light Sweet (LLS) and Brent crude oils.

These crude oil feedstock differentials vary significantly depending on overall economic conditions and trends and conditions within the markets for crude oil and refined products, and they could decline in the future, which would have a negative impact on our results of operations.

Compliance with and changes in environmental laws, including proposed climate change laws and regulations, could adversely affect our performance.

The principal environmental risks associated with our operations are emissions into the air and releases into the soil, surface water, or groundwater.

Our operations are subject to extensive environmental laws and regulations, including those relating to the discharge of materials into the environment, waste management, pollution prevention measures, greenhouse gas emissions, and characteristics and composition of gasoline

and diesel fuels.

Certain of these laws and regulations could impose obligations to conduct assessment or remediation efforts at our facilities as well as at formerly owned properties or third-party sites where we have taken wastes for disposal or where our wastes have migrated.

Environmental laws and regulations also may impose liability on us for the conduct of third parties, or for actions that complied with applicable requirements when taken, regardless of negligence or fault.

If we violate or fail to comply with these laws and regulations, we could be fined or otherwise sanctioned.

Because environmental laws and regulations are becoming more stringent and new environmental laws and regulations are continuously being enacted or proposed, such as those relating to greenhouse gas emissions and climate change, the level of expenditures required for environmental matters could increase in the future.

Current and future legislative action and regulatory initiatives could result in changes to operating permits, material changes in operations, increased capital expenditures and operating costs, increased costs of the goods we sell, and decreased demand for our products that cannot be assessed with certainty at this time.

We may be required to make expenditures to modify operations or install pollution control equipment that could materially and adversely affect our business, financial condition, results of operations, and liquidity.

For example, the U.S. Environmental Protection Agency (EPA) has, in recent years, adopted final rules making more stringent the National Ambient Air Quality Standards (NAAQS) for ozone, sulfur dioxide, and nitrogen dioxide, and the U.S. EPA is considering further revisions to the NAAQS.

Emerging rules and permitting requirements implementing these revised standards may require us to install more stringent controls at our facilities, which may result in increased capital expenditures.

Governmental restrictions on greenhouse gas emissions – including so-called “cap-and-trade” programs targeted at reducing carbon dioxide emissions – could result in material increased compliance costs, additional operating restrictions or permitting delays for our business, and an increase in the cost of, and reduction in demand for, the products we produce, which could have a material adverse effect on our financial position, results of operations, and liquidity.

Disruption of our ability to obtain crude oil could adversely affect our operations.

A significant portion of our feedstock requirements is satisfied through supplies originating in the Middle East, Africa, Asia, North America, and South America.

We are, therefore, subject to the political, geographic, and economic risks attendant to doing business with suppliers located in, and supplies originating from, these areas.

If one or more of our supply contracts were terminated, or if political events disrupt our traditional crude oil supply, we believe that adequate alternative supplies of crude oil would be available, but it is possible that we would be unable to find alternative sources of supply.

If we are unable to obtain adequate crude oil volumes or are able to obtain such volumes only at unfavorable prices, our results of operations could be materially adversely affected, including reduced sales volumes of refined products or reduced margins as a result of higher crude oil costs.

In addition, the U.S. government can prevent or restrict us from doing business in or with other countries.

These restrictions, and those of other governments, could limit our ability to gain access to business opportunities in various countries.

Actions by both the U.S. and other countries have affected our operations in the past and will continue to do so in the future.

The following review of our results of operations and financial condition should be read in conjunction with [removed: Items 1,] [added: Item] 1A, [removed: and 2, “Business, Risk Factors, and Properties,”] [added: “Risk Factors,”] and Item 8, “Financial Statements and Supplementary Data,” included in this report.

| • | anticipated trends in the supply of and demand for crude oil and other feedstocks and refined products [removed: globally and] in the regions where we [removed: operate;] [added: operate, as well as globally;] |

| • | the effect of general economic and other conditions on [removed: refining,] [added: refining] and ethanol industry fundamentals. |

| • | the levels of government subsidies for [removed: ethanol and other] alternative fuels; |

| • | legislative or regulatory action, including the introduction or enactment of legislation or rulemakings by governmental authorities, including tax and environmental regulations, such as those [removed: to be] implemented under the California Global Warming Solutions Act (also known as AB [removed: 32)] [added: 32), Quebec’s Regulation respecting the cap-and-trade system for greenhouse gas emission allowances (the Quebec cap-and-trade system),] and the [added: U.S.] EPA’s regulation of greenhouse gases, which may adversely affect our business or operations; |

| • | other factors generally described in the “Risk Factors” section included in [removed: Items 1,] [added: Item] 1A, [removed: and 2, “Business, Risk Factors, and Properties”] [added: “Risk Factors”] in this report. |

For the year ended December 31, [removed: 2013,] [added: 2014,] we reported net income attributable to Valero stockholders [added: from continuing operations] of [removed: $2.7] [added: $3.7] billion, or [removed: $4.97] [added: $6.97] per share (assuming dilution), compared to [removed: $2.1] [added: $2.7] billion, or [removed: $3.75] [added: $4.96] per share (assuming dilution), for the year ended December 31, [removed: 2012.][added: 2013.]

[removed: In addition, during 2013, we recorded] [added: The increase in our operating income was partially offset by] a $325 million nontaxable gain [added: recorded in 2013] related to the disposition of our retained interest in [removed: CST Brands, Inc. (CST),] [added: CST,] which is more fully described in Notes 3 and 11 of Notes to Consolidated Financial Statements.

Our operating income [removed: decreased $47 million] [added: increased $1.9 billion] from [removed: 2012 to] 2013 [added: to 2014] as outlined by business segment in the following table (in millions):

| | [removed: |] 2013 [added: (b)] | | | | 2012 | | | | Change | | |

| [removed: Retail] [added: Operating income (b) (d)] | [added: $] | 81 | | | [added: $] | 348 | | | [added: $] | (267 | [removed: |] ) |

| Ethanol | | [removed: 491] [added: 786] | | | | [removed: (47] [added: 491] | | [removed: )] | | [removed: 538] [added: 295] | | |

| Corporate | | [removed: (826] [added: (768] | | ) | | [removed: (741] [added: (826] | | ) | | [removed: (85] [added: 58] | | [removed: )] |

On May 1, 2013, we completed the separation of our retail [removed: business] [added: business,] by spinning off [removed: 80 percent of] CST as an independent public company.

Our ethanol segment operating income [removed: in 2013] increased [removed: $538] [added: $295] million [added: in 2014] compared to [removed: 2012] [added: 2013] due to [removed: higher gross margin per gallon of ethanol] [added: lower corn feedstock costs] and higher production [removed: volumes.][added: volumes, partially offset by lower co-product prices and lower ethanol prices.]

Financial Highlights [added: (a)]

| | 2013 [removed: (a)] | | | | 2012 | | | | Change | | |

| Operating revenues | $ | 138,074 | | | $ | [removed: 139,250] [added: 138,393] | | | $ | [removed: (1,176] [added: (319] | ) |

| Cost of sales | [removed: 127,316] [added: 118,141] | | | | [removed: 127,268] [added: 127,316] | | | | [removed: 48] [added: (9,175] | | [added: )] |

| Refining | [removed: 1,566] [added: 1,597] | | | | [removed: 1,370] [added: 1,566] | | | | [removed: 196] [added: 31] | | |

| Asset impairment losses (c) | — | | | | [removed: 1,014] [added: 86] | | | | [removed: (1,014] [added: (86] | | ) |

| Operating income | [removed: 3,963] [added: $] | [added: —] | | | [removed: 4,010] [added: $] | [added: 81] | | | [removed: (47] [added: $] | [added: (81] | ) |

| Gain on disposition of retained interest in CST Brands, Inc. [removed: (a)] [added: (b)] | [removed: 325] [added: —] | | | | [removed: —] [added: 325] | | | | [removed: 325] [added: (325] | | [added: )] |

| Other income, net | [removed: 59] [added: 47] | | | | [removed: 9] [added: 59] | | | | [removed: 50] [added: (12] | | [added: )] |

| Interest and debt expense, net of capitalized interest | [removed: (365] [added: (397] | | ) | | [removed: (313] [added: (365] | | ) | | [removed: (52] [added: (32] | | ) |

| Less: Net income [removed: (loss)] attributable to noncontrolling interests | [removed: 8] [added: 81] | | | | [removed: (3] [added: 8] | | [removed: )] | | [removed: 11] [added: 73] | | |

| Net income attributable to Valero [added: Energy Corporation] stockholders | $ | 2,720 | | | $ | 2,083 | | | $ | 637 | |

| Earnings per common share – assuming [removed: dilution] [added: dilution:] | [removed: $] | [removed: 4.97] | | | [removed: $] | [removed: 3.75] | | | [removed: $] | [removed: 1.22] | |

See note references on page [removed: 32.][added: 31.]

Refining Operating Highlights [added: (a)]

| [removed: Refining (b) (c):] [added: Refining:] | | | | | | | | | | | |

| Throughput margin per barrel [removed: (e)] [added: (c)] | $ | [removed: 9.69] [added: 11.28] | | | $ | [removed: 10.96] [added: 9.69] | | | $ | [removed: (1.27] [added: 1.59] | [removed: )] |

| Operating expenses | [removed: 3.78] [added: 3.87] | | | | 3.79 | | | | [removed: (0.01] [added: 0.08] | | [removed: )] |

| Depreciation and amortization expense | [removed: 1.60] [added: 1.58] | | | | [removed: 1.44] [added: 1.60] | | | | [removed: 0.16] [added: (0.02] | | [added: )] |

| Total operating costs per barrel | [removed: 5.38] [added: 5.45] | | | | [removed: 5.23] [added: 5.39] | | | | [removed: 0.15] [added: 0.06] | | |

| Operating income per barrel | $ | [removed: 4.31] [added: 5.83] | | | $ | [removed: 5.73] [added: 4.30] | | | $ | [removed: (1.42] [added: 1.53] | [removed: )] |

| Heavy sour crude [added: oil] | [removed: 486] [added: 457] | | | | [removed: 453] [added: 486] | | | | [removed: 33] [added: (29] | | [added: )] |

| Medium/light sour crude [added: oil] | 466 | | | | [removed: 547] [added: 466] | | | | [removed: (81] [added: —] | | [removed: )] |

| Sweet crude [added: oil] | 1,039 | | | | 991 | | | | 48 | | |

| Residuals | [removed: 282] [added: 230] | | | | [removed: 200] [added: 282] | | | | [removed: 82] [added: (52] | | [added: )] |

| • | the volatility in the market price of biofuel credits (primarily Renewable Identification Numbers (RINs) needed to comply with the U.S. federal Renewable Fuel Standard); |

The increase of $980 million was due primarily to the increase of $1.9 billion in our operating income as shown in the table below.

| Refining | | $ | 5,884 | | | $ | 4,211 | | | $ | 1,673 | |

| Total | | $ | 5,902 | | | $ | 3,957 | | | $ | 1,945 | |

The $1.7 billion increase in refining segment operating income for 2014 compared to 2013 was due to wider discounts for sweet and sour crude oils relative to Brent crude oil, higher throughput volumes in our U.S. Gulf Coast region, and higher margins on other refined products (e.g., petroleum coke and sulfur), partially offset by weaker distillate margins.

Higher energy costs and depreciation expense between the periods also impacted our refining segment income.

Therefore, we did not have any retail segment operations in 2014, resulting in the $81 million decrease in retail segment operating income in 2014 compared to 2013.

Additional details and analysis of the changes in the operating income of our business segments and other components of net income attributable to Valero stockholders are provided below under “RESULTS OF OPERATIONS.”

Energy markets and margins were volatile during 2014, especially in the latter part of the year, and we expect them to continue to be volatile in the near to mid-term.

Below is a summary of factors that have impacted or may impact our results of operations during the first quarter of 2015:

| • | Discounts in the price of medium sour and heavy sour crude oils as compared to the price of Brent crude oil have widened since year end as producers of those crude oils have attempted to maintain market share in an oversupplied crude oil market. |

| • | Discounts in the price of North American sweet crude oils as compared to the price of Brent crude oil are expected to increase due to a build in U.S. crude oil inventories, driven primarily by (i) increasing imports of medium sour and heavy sour crude oils, (ii) seasonal planned refinery maintenance, and (iii) a crude oil market structure where the future price is higher than the current price of crude oil, which indicates that the crude oil market is oversupplied. |

| • | Refined product margins are expected to strengthen due to an increase in the demand for refined products and the impact on product inventories from refinery maintenance thus far in the first quarter of 2015. |

| • | Ethanol margins are expected to remain relatively low as long as gasoline prices remain low. |

| • | The market price of biofuel credits (primarily RINs) is expected to remain volatile during 2015. |

| • | The cost to implement certain provisions of the AB 32 cap-and-trade system and low carbon fuel standard in California and the Quebec cap-and-trade system may be significant; however, we expect to recover the majority of these costs from our customers. |

| • | A further decline in market prices of crude oil and refined products may negatively impact the carrying value of our inventories. |

| • | The United Steelworkers union and the U.S. refining industry are currently in the process of collective bargaining and strikes have been called at 12 U.S. refineries. We have four refineries that could be targeted for a strike but none has been targeted at this time. Also note our disclosures in Item 1A, “Risk Factors” — Our business may be negatively affected by work stoppages, slowdowns or strikes by our employees, as well as new labor legislation issued by regulators. |

2014 Compared to 2013

| | 2014 | | | | 2013 (b) | | | | Change | | |

| Operating revenues | $ | 130,844 | | | $ | 138,074 | | | $ | (7,230 | ) |

| Refining | 3,900 | | | | 3,710 | | | | 190 | | |

| Retail | — | | | | 226 | | | | (226 | | ) |

| Ethanol | 487 | | | | 387 | | | | 100 | | |

| Total costs and expenses | 124,942 | | | | 134,117 | | | | (9,175 | | ) |

| Operating income | 5,902 | | | | 3,957 | | | | 1,945 | | |

| Income tax expense | 1,777 | | | | 1,254 | | | | 523 | | |

| Net income | 3,711 | | | | 2,728 | | | | 983 | | |

| Net income attributable to Valero Energy Corporation stockholders | $ | 3,630 | | | $ | 2,720 | | | $ | 910 | |

| Continuing operations | $ | 3,694 | | | $ | 2,714 | | | $ | 980 | |

| Total | $ | 3,630 | | | $ | 2,720 | | | $ | 910 | |

| Continuing operations | $ | 6.97 | | | $ | 4.96 | | | $ | 2.01 | |

| Total | $ | 6.85 | | | $ | 4.97 | | | $ | 1.88 | |

| | 2014 | | | | 2013 | | | | Change | | |

| Operating income | $ | 5,884 | | | $ | 4,211 | | | $ | 1,673 | |

| Sweet crude oil | 1,149 | | | | 1,039 | | | | 110 | | |

________________

| | 2014 | | | | 2013 | | | | Change | | |

| Operating income | $ | 3,484 | | | $ | 2,375 | | | $ | 1,109 | |

| Operating expenses | 3.90 | | | | 3.58 | | | | 0.32 | | |

The increase in net income attributable to Valero stockholders of $637 million was primarily due to the effect of asset impairment losses of $1.0 billion recorded during the year ended December 31, 2012, which lowered net income for 2012, as compared to the year ended December 31, 2013.

Excluding these significant items, net income attributable to Valero stockholders for 2013 declined by $702 million due primarily to lower refining segment operating income as discussed below.

| Refining | | $ | 4,217 | | | $ | 4,450 | | | $ | (233 | ) |

| Total | | $ | 3,963 | | | $ | 4,010 | | | $ | (47 | ) |

Operating income for 2012 was negatively impacted by asset impairment losses of $1.0 billion, of which $928 million related to our Aruba refinery (as further discussed in Note 4 of Notes to Consolidated Financial Statements), and severance expense of $41 million, which was also related to our Aruba Refinery (as further discussed in Note 10 of Notes to Consolidated Financial Statements).

Excluding these significant items, total operating income and refining segment operating income for 2012 would have been $5.1 billion and $5.5 billion, respectively, resulting in a $1.1 billion decrease in total operating income and a $1.3 billion decrease in refining segment operating income from 2012 to 2013.

The $1.3 billion decrease in refining segment operating income for 2013 compared to 2012 was primarily due to lower refining margins in each of our regions.

The decrease in refining margins was the result of lower gasoline margins, lower discounts on light sweet crude oils, and higher costs of biofuel credits (primarily Renewable Identification Numbers (RINs) needed to comply with the U.S. federal Renewable Fuel Standard (RFS)), which were partially offset by higher distillate margins and higher discounts on sour crude oils between the years.

As a result, we no longer operate a retail business and had no retail segment operating results after April 30, 2013, resulting in the $267 million decrease in retail segment operating income for 2013 compared to 2012.

The separation of our retail business is more fully discussed in Note 3 of Notes to Consolidated Financial Statements.

Lower corn prices and higher ethanol prices contributed to the improved gross margin.

We increased our production of ethanol following the first quarter of 2013 to capture the improved economics of higher gross margins per gallon during 2013.

On December 16, 2013, Valero Energy Partners LP (VLP) completed its initial public offering of 17,250,000 common units at a price of $23.00 per unit, which included a 2,250,000 common unit over-allotment option that was fully exercised by the underwriters.

VLP received $369 million in net proceeds from the sale of the units, after deducting underwriting fees, structuring fees and other offering costs.

VLP’s initial assets include crude oil and refined petroleum products pipeline and terminal systems in the U.S. Gulf Coast and U.S. Mid-Continent regions that are integral to the operations of our Port Arthur, McKee, and Memphis Refineries.

See Note 5 of Notes to Consolidated Financial Statements for additional information.

Our refining segment benefits from processing sour crude oils (such as Maya crude oil) in our U.S. Gulf Coast region and light sweet crude oils (such as WTI crude oil) in our U.S. Mid-Continent region due to the favorable discounts between the prices of these types of crude oil and the price of Brent crude oil.

Because the market for refined products generally tracks the price of Brent crude oil, which is a benchmark sweet crude oil, we benefit when we process crude oils that are priced at a discount to Brent crude oil.

The discounts in the prices of light sweet and sour crude oils compared to the price of Brent crude oil widened significantly during the fourth quarter of 2013.

For the first quarter of 2014, discounts on light sweet and sour crude oils narrowed slightly compared to the fourth quarter and we expect these discounts to remain volatile for the remainder of the first quarter.

In addition, gasoline margins across all regions were seasonally weak during the fourth quarter of 2013 and remain seasonally weak thus far in the first quarter of 2014.

Distillate margins across all regions, thus far in 2014, have remained consistent with those realized during the fourth quarter of 2013.

We are exposed to the volatility in the market prices of crude oil and refined products, and we expect such prices to continue to be volatile in the near to mid-term.

We are also exposed to the volatility in the market price of biofuel credits (primarily RINs in the U.S.), which we purchase in the open market to meet our obligation to blend biofuels into the products we produce.

To date during the first quarter of 2014, the market price of RINs has increased compared to year end levels, but the price remains lower than prices experienced during 2013.

Therefore, we estimate that the cost of meeting our obligation for the full year of 2014 will be between $250 million and $350 million.

Because the market price of RINs is volatile and is significantly impacted by biofuel blending rates that are established by the EPA, it is difficult for us to predict reliably the market price of RINs.

| Refining (b) | 3,704 | | | | 3,668 | | | | 36 | | |

| Total costs and expenses | 134,111 | | | | 135,240 | | | | (1,129 | | ) |

| Income before income tax expense | 3,982 | | | | 3,706 | | | | 276 | | |

| Operating income | $ | 4,217 | | | $ | 4,450 | | | $ | (233 | ) |

__________

| Operating income | $ | 2,381 | | | $ | 2,541 | | | $ | (160 | ) |

| Severance expense (b) | — | | | | (41 | | ) | | 41 | | |

| Asset impairment losses (c) | — | | | | (993 | | ) | | 993 | | |

__________

__________

__________

| (b) | In September 2012, we decided to reorganize our Aruba Refinery into a crude oil and refined products terminal. The reorganization resulted in the termination of the majority of our employees in Aruba, and we recognized severance expense of $41 million in September 2012. This expense is reflected in refining segment operating income for the year ended December 31, 2012, but it is excluded from operating costs per barrel for the refining segment and the U.S. Gulf Coast region. No income tax benefits were recognized related to this severance expense. |

Excluding asset impairment losses and severance expenses of $993 million and $41 million in 2012 primarily related to our Aruba Refinery, which are more fully described in Notes 4 and 10 of Notes to Consolidated Financial Statements, respectively, refining segment operating income decreased $1.3 billion from 2012 to 2013.

| 10% increase in underlying commodity prices | [removed: $ |] (91 | [removed: )] | [added: )] | [removed: $] | 3 | | [added: |]

| 10% increase in underlying commodity prices | [removed: (131] [added: $] | [added: (127] | ) | | [removed: (9] [added: $] | [added: (2] | ) |

| 10% decrease in underlying commodity prices | [removed: 135] [added: 126] | | | | [removed: (1] [added: 7] | | [removed: )] |

See Note 21 of Notes to Consolidated Financial Statements for notional volumes associated with these derivative contracts as of December 31, [removed: 2013.][added: 2014.]

To manage this risk, we enter into contracts to purchase [added: these credits when prices are deemed favorable.]

As of December 31, [removed: 2013,] [added: 2014,] there was no gain or loss in the fair value of derivative instruments that would result from a 10 percent increase or decrease in the underlying price of the contracts.

We had no interest rate derivative instruments outstanding as of December 31, [removed: 2013] [added: 2014] and [removed: 2012.][added: 2013.]

| Floating rate | $ | [removed: 100] [added: 126] | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | [removed: 100] [added: 126] | | | $ | [removed: 100] [added: 126] | |

| Average interest rate | [removed: 0.9] [added: 2.0] | | % | | — | | % | | — | | % | | — | | % | | — | | % | | — | | % | | [removed: 0.9] [added: 2.0] | | % | | | | |

| | [removed: 2013] [added: 2015] | | | | [removed: 2014] [added: 2016] | | | | [removed: 2015] [added: 2017] | | | | [removed: 2016] [added: 2018] | | | | [removed: 2017] [added: 2019] | | | | There- after | | | | Total | | | | Fair Value | | |

| Average interest rate | [removed: 5.5] [added: 5.2] | | % | | [removed: 4.8] [added: —] | | % | | [removed: 5.2] [added: 6.4] | | % | | — | | % | | [removed: 6.4] [added: 9.4] | | % | | [removed: 7.3] [added: 6.9] | | % | | [removed: 6.8] [added: 7.0] | | % | | | | |

As of December 31, [removed: 2013,] [added: 2014,] we had commitments to purchase [removed: $716] [added: $377] million of U.S. dollars.

Our market risk was minimal on the contracts, as the majority of them matured on or before January 31, [removed: 2014,] [added: 2015,] resulting in a gain of $12 million in the first quarter of [removed: 2014.][added: 2015.]

| December 31, 2014: | | | | | | | |

| | December 31, 2014 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Fixed rate | $ | 475 | | | $ | — | | | $ | 950 | | | $ | — | | | $ | 750 | | | $ | 4,074 | | | $ | 6,249 | | | $ | 7,436 | |

| December 31, 2012: | | | | | | | |

these credits when prices are deemed favorable.

| | December 31, 2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Fixed rate | $ | 480 | | | $ | 200 | | | $ | 475 | | | $ | — | | | $ | 950 | | | $ | 4,824 | | | $ | 6,929 | | | $ | 8,521 | |

The Illinois [removed: Environmental Protection Agency] [added: EPA] has issued several Notices of Violation (NOVs) alleging violations of air and waste regulations at Premcor’s Hartford, Illinois terminal and closed refinery.

We currently have multiple outstanding Violation Notices (VNs) issued by the [removed: BAAQMD in 2011, 2012, and 2013,] [added: BAAQMD,] which we reasonably believe may result in penalties of $100,000 or more.

We continue to work with the [removed: SCAQMD] [added: TCEQ] to [removed: resolve] [added: finalize] these [removed: NOVs.][added: Agreed Orders.]

In our annual report on Form 10-K for the year ended December 31, [removed: 2012,] [added: 2013,] we reported that our Port Arthur Refinery [added: had] received a proposed agreed order from the TCEQ that assessed a penalty of $180,911 for [removed: various] alleged air emission and reporting [removed: violations.][added: violations, and a Notice of Enforcement (NOE) for unauthorized emissions with potential stipulated penalties of $166,000.]

In the first quarter of 2015, we entered into an Agreement to resolve various NOVs, and we continue to work with the SCAQMD to resolve the remaining NOVs.

In the first quarter of 2014, we received two proposed Agreed Orders from the TCEQ resolving multiple violations that occurred between May 2007 and April 2013, including all the unauthorized emissions, reporting violations, and stipulated penalties in the two NOEs referenced above.

EPA (St. Charles Refinery).

In our quarterly report on Form 10-Q for the quarter ended June 30, 2013, we reported that the EPA had issued to our St. Charles Refinery a draft Compliance Agreement and Final Order assessing a penalty of $440,000 for various alleged violations under the Clean Air Act’s Section 112(r) and the EPA’s Risk Management Program.

Recently, we resolved the matter with the EPA.

The Port Arthur Refinery has also received additional Notices of Enforcement (NOEs), for which we have not received proposed penalty amounts but reasonably believe may result in penalties of $100,000 or more.

We are working with the TCEQ to resolve all of these outstanding violations.

TCEQ (Port Arthur Refinery).

In our annual report on Form 10-K for the year ended December 31, 2012, we reported that the TCEQ issued an NOE for unauthorized flare emissions.

Potential stipulated penalties under our EPA §114 Clean Air Act Consent Decree for these incidents are expected to be $166,000 should the EPA issue a stipulated penalty demand letter for these events.

| [removed: R] [added: þ] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |

For the fiscal year ended December 31, [removed: 2013][added: 2014]

Yes [removed: R] [added: þ] No o

Yes [removed: R No] o [added: No þ]

Yes [removed: R] [added: þ] No o

Yes [removed: R] [added: þ] No o

| Large accelerated filer [removed: R] [added: þ] | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o |

Yes o No [removed: R][added: þ]

The aggregate market value of the voting and non-voting common stock held by non-affiliates was approximately [removed: $18.8] [added: $26.5] billion based on the last sales price quoted as of June [removed: 28, 2013] [added: 30, 2014] on the New York Stock Exchange, the last business day of the registrant’s most recently completed second fiscal quarter.

As of January [removed: 31, 2014, 532,510,263] [added: 30, 2015, 514,888,348] shares of the registrant’s common stock were outstanding.

We intend to file with the Securities and Exchange Commission a definitive Proxy Statement for our Annual Meeting of Stockholders scheduled for [removed: May 1, 2014,] [added: April 30, 2015,] at which directors will be elected.

Portions of the [removed: 2014] [added: 2015] Proxy Statement are incorporated by reference in Part III of this Form 10-K and are deemed to be a part of this report.

The following table indicates the headings in the [removed: 2014] [added: 2015] Proxy Statement where certain information required in Part III of this Form 10-K may be found.

| Form 10-K Item No. and Caption | | | Heading in [removed: 2014] [added: 2015] Proxy Statement |

| 14. | Principal Accountant Fees and Services | | KPMG Fees for Fiscal [removed: Year 2013, KPMG Fees for Fiscal Year 2012,] [added: Years 2014] and [added: 2013 and] Audit Committee Pre-Approval Policy |

| [Items [removed: 1., 1A.,] [added: 1.] & [removed: 2.](#s6DCECA663EAB1455A0573308FFA9C742)] [added: 2.](#s127EBFFE042DFCE1870EAA65BD32D5D8)] | [removed: [Business, Risk Factors,] [added: [Business] and [removed: Properties](#s6DCECA663EAB1455A0573308FFA9C742)] [added: Properties](#s127EBFFE042DFCE1870EAA65BD32D5D8)] | [removed: [1](#s6DCECA663EAB1455A0573308FFA9C742)] [added: [1](#s127EBFFE042DFCE1870EAA65BD32D5D8)] |

| | [Valero’s [removed: Operations](#sF21F4BB22489EA10BA4A3308D38AE5B6)] [added: Operations](#s60321BC43DB1F2A3129FAA65950AD7F2)] | [removed: [3](#sF21F4BB22489EA10BA4A3308D38AE5B6)] [added: [2](#s60321BC43DB1F2A3129FAA65950AD7F2)] |

| | [Environmental [removed: Matters](#s4453C8CCAF5D808CA2EA330900457AF5)] [added: Matters](#s74FBE53320C6240EC0CBAA65BDDEE61C)] | [removed: [17](#s4453C8CCAF5D808CA2EA330900457AF5)] [added: [11](#sf1ac713ff5e14810bcf68a41ee6c45cb)] |

| [Item [removed: 1B.](#s159A7A773830D3233205330900A2BB9F)] [added: 1B.](#s5051F678105BBE05A343AA65BE2C2F3F)] | [Unresolved Staff [removed: Comments](#s159A7A773830D3233205330900A2BB9F)] [added: Comments](#s5051F678105BBE05A343AA65BE2C2F3F)] | [removed: [18](#s159A7A773830D3233205330900A2BB9F)] [added: [18](#s5051F678105BBE05A343AA65BE2C2F3F)] |

| [Item [removed: 3.](#sFDB21F03FB36990E9FDF330900D1A764)] [added: 3.](#sD6E1563FE5DD15073384AA65BE5AFA81)] | [Legal [removed: Proceedings](#sFDB21F03FB36990E9FDF330900D1A764)] [added: Proceedings](#sD6E1563FE5DD15073384AA65BE5AFA81)] | [removed: [18](#sFDB21F03FB36990E9FDF330900D1A764)] [added: [18](#sD6E1563FE5DD15073384AA65BE5AFA81)] |

| [Item [removed: 4.](#sAE65EBF01AB593B38132330900F00255)] [added: 4.](#s5BABB77DDE2FEEE0B534AA65BE7ABCE1)] | [Mine Safety [removed: Disclosures](#sAE65EBF01AB593B38132330900F00255)] [added: Disclosures](#s5BABB77DDE2FEEE0B534AA65BE7ABCE1)] | [removed: [19](#sAE65EBF01AB593B38132330900F00255)] [added: [18](#s5BABB77DDE2FEEE0B534AA65BE7ABCE1)] |

| [Item [removed: 5.](#s9801AE7C04316E1BE4273308D46587E3)] [added: 5.](#s6BD53E689B5342BC8799AA6596806A0B)] | [Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity [removed: Securities](#s9801AE7C04316E1BE4273308D46587E3)] [added: Securities](#s6BD53E689B5342BC8799AA6596806A0B)] | [removed: [19](#s9801AE7C04316E1BE4273308D46587E3)] [added: [19](#s6BD53E689B5342BC8799AA6596806A0B)] |

| [Item [removed: 6.](#s43663084188A31A550443309019C7D3A)] [added: 6.](#s6B102E77B262AA9CFA7EAA65BF067D3F)] | [Selected Financial [removed: Data](#s43663084188A31A550443309019C7D3A)] [added: Data](#s6B102E77B262AA9CFA7EAA65BF067D3F)] | [removed: [22](#s43663084188A31A550443309019C7D3A)] [added: [22](#s6B102E77B262AA9CFA7EAA65BF067D3F)] |

| [Item [removed: 7.](#s5C52D5F13F321B59949E330901CBD40E)] [added: 7.](#s8B0CBB59D29ADAFD2109AA65BF256F2B)] | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#s5C52D5F13F321B59949E330901CBD40E)] [added: Operations](#s8B0CBB59D29ADAFD2109AA65BF256F2B)] | [removed: [23](#s5C52D5F13F321B59949E330901CBD40E)] [added: [23](#s8B0CBB59D29ADAFD2109AA65BF256F2B)] |

| [Item [removed: 7A.](#s3CBC9CEE76A4B6F2B4B33309045A1131)] [added: 7A.](#s73C99B80D618941A4780AA65C0ABF721)] | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#s3CBC9CEE76A4B6F2B4B33309045A1131)] [added: Risk](#s73C99B80D618941A4780AA65C0ABF721)] | [removed: [54](#s3CBC9CEE76A4B6F2B4B33309045A1131)] [added: [52](#s73C99B80D618941A4780AA65C0ABF721)] |

| [Item [removed: 8.](#s15B32093439C7B7BFD7733090498B170)] [added: 8.](#sEDCDDA813FCD6601AC22AA6583BBF654)] | [Financial Statements and Supplementary [removed: Data](#s15B32093439C7B7BFD7733090498B170)] [added: Data](#sEDCDDA813FCD6601AC22AA6583BBF654)] | [removed: [56](#s15B32093439C7B7BFD7733090498B170)] [added: [54](#sEDCDDA813FCD6601AC22AA6583BBF654)] |

| [Item [removed: 9.](#sE39811610E6E074153D033090D8D187E)] [added: 9.](#sB4F8224D5874C39072A6AA65C849C5AE)] | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#sE39811610E6E074153D033090D8D187E)] [added: Disclosure](#sB4F8224D5874C39072A6AA65C849C5AE)] | [removed: [134](#sE39811610E6E074153D033090D8D187E)] [added: [127](#sB4F8224D5874C39072A6AA65C849C5AE)] |

| [Item [removed: 9A.](#s1D719021B51DBA6A5EC933090D9D00E9)] [added: 9A.](#s225B2DAC1D67AFA2F7A4AA65C878A785)] | [Controls and [removed: Procedures](#s1D719021B51DBA6A5EC933090D9D00E9)] [added: Procedures](#s225B2DAC1D67AFA2F7A4AA65C878A785)] | [removed: [134](#s1D719021B51DBA6A5EC933090D9D00E9)] [added: [127](#s225B2DAC1D67AFA2F7A4AA65C878A785)] |

| [Item [removed: 9B.](#s284EE94CC99276C0C62633090DDBD7CE)] [added: 9B.](#s6D05285BC0BB641F1587AA65C8972294)] | [Other [removed: Information](#s284EE94CC99276C0C62633090DDBD7CE)] [added: Information](#s6D05285BC0BB641F1587AA65C8972294)] | [removed: [134](#s284EE94CC99276C0C62633090DDBD7CE)] [added: [127](#s6D05285BC0BB641F1587AA65C8972294)] |

| [PART [removed: III](#sCF1F7F1D7A11C552581333090DFB5640)] [added: III](#sD7140F18FEBC4C5E8CE9AA65C8C613E3)] | | |

| [Item [removed: 10.](#sC19931052EFA1426950A33090E2938D5)] [added: 10.](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [Directors, Executive Officers and Corporate [removed: Governance](#sC19931052EFA1426950A33090E2938D5)] [added: Governance](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: [135](#sC19931052EFA1426950A33090E2938D5)] [added: [128](#s1C095562FCF34CEFBA2BAA65C8E5561B)] |

| [removed: Item 11.] [added: [Item 11.](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: Executive Compensation] [added: [Executive Compensation](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: [135](#sC19931052EFA1426950A33090E2938D5)] [added: [128](#s1C095562FCF34CEFBA2BAA65C8E5561B)] |

| [removed: Item 12.] [added: [Item 12.](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: Security] [added: [Security] Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters] [added: Matters](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: [135](#sC19931052EFA1426950A33090E2938D5)] [added: [128](#s1C095562FCF34CEFBA2BAA65C8E5561B)] |

| [removed: Item 13.] [added: [Item 13.](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: Certain] [added: [Certain] Relationships and Related Transactions, and Director [removed: Independence] [added: Independence](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: [135](#sC19931052EFA1426950A33090E2938D5)] [added: [128](#s1C095562FCF34CEFBA2BAA65C8E5561B)] |

| [removed: Item 14.] [added: [Item 14.](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: Principal] [added: [Principal] Accountant Fees and [removed: Services] [added: Services](#s1C095562FCF34CEFBA2BAA65C8E5561B)] | [removed: [135](#sC19931052EFA1426950A33090E2938D5)] [added: [128](#s1C095562FCF34CEFBA2BAA65C8E5561B)] |

| [Item [removed: 15.](#s4515C20BE9C32035A3F33308C0871C42)] [added: 15.](#s04D057695792E3D2C4E8AA6587B14F72)] | [Exhibits and Financial Statement [removed: Schedules](#s5D2816F0EB3028C1A3493308D983DFAC)] [added: Schedules](#s1F843A02118D8189F5E5AA659BBE1EB3)] | [removed: [135](#s5D2816F0EB3028C1A3493308D983DFAC)] [added: [128](#s1F843A02118D8189F5E5AA659BBE1EB3)] |

In this Form 10-K, we make certain forward-looking statements, including statements regarding our plans, strategies, objectives, expectations, intentions, and [removed: resources,] [added: resources] under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

You should read our forward-looking statements together with our disclosures beginning on page [removed: 23] [added: [23](#s44F6B022117AA59E8188AA65BF540078)] of this report under the heading: “CAUTIONARY STATEMENT FOR THE PURPOSE OF SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.”

[removed: BUSINESS, RISK FACTORS,] [added: BUSINESS] AND PROPERTIES

On January 31, [removed: 2014,] [added: 2015,] we had [removed: 10,007] [added: 10,065] employees.

10-K 1 vloform10-kx12312014.htm 10-K

| [PART I](#s39F83D91BDC17064E800AA65BD135394) | | |

| | [Segments](#s2F4742A5D48C8345D199AA65BD61F15C) | [1](#s2F4742A5D48C8345D199AA65BD61F15C) |

| | [Properties](#s547D00CF662E804F06CAAA65BE0CFE23) | [11](#s29381c2ec7234528aa4afd51902092c5) |

| [PART II](#sB3FAADA3D8FFE72EF56BAA65BEB8C3C4) | | |

| [PART IV](#s9E57841904C4351F909FAA65C9242F0A) | | |

| [Signature](#sB5DA21392432AFBD5654AA65C9724B68) | | [132](#sB5DA21392432AFBD5654AA65C9724B68) |

ITEMS 1.

and 2.

| | | | | 1,660,000 | |

| | | | | 465,000 | |

The East Refinery processes sour crude oil, and the West Refinery processes sweet crude oil, sour crude oil, and residual fuel oil.

The feedstocks are delivered by tanker or barge via deepwater docking facilities along the Corpus Christi Ship Channel, and West Texas or South Texas crude oil is delivered via pipelines.

The refineries produce gasoline, aromatics, jet fuel, diesel, and asphalt.

These and other finished products are also distributed by ship or barge across docks and third-party pipelines.

The refinery receives crude oil by rail, marine docks, and crude oil pipelines.

Our Meraux Refinery is located approximately 25 miles southeast of New Orleans along the Mississippi River.

The refinery processes sour and sweet crude oils into gasoline, diesel, jet fuel, and high sulfur fuel oil.

Finished products can be shipped from the refinery’s dock or through the Colonial pipeline.

Gasoline production is primarily CARBOB gasoline, which meets CARB specifications when blended with ethanol.

| | | Mount Vernon | | 100 million | | 320,000 | | 37 million |

| | | total | | 1,305 million | | 3,910,000 | | 462 million |

| • | Item 1A, “Risk Factors”—We may incur additional costs as a result of our use of rail cars for the transportation of crude oil and the products that we manufacture, |

10-K 1 vloform10-kx12312013.htm 10-K

| | | | |

| | | | |

\[X\]

| | | | |

| | | | |

| | | | |

| [PART I](#s06032146CCE552D8BAA73308FF7AD38B) | | |

| | [Segments](#s3100CB247DE00FBF22063308FFD7869A) | [2](#s3100CB247DE00FBF22063308FFD7869A) |

| | [Risk Factors](#sB8230C7869E4716607E733090035651C) | [12](#sB8230C7869E4716607E733090035651C) |

| | [Properties](#sC1D9975B7E7BC5D608D133090083059E) | [17](#sC1D9975B7E7BC5D608D133090083059E) |

| [PART II](#s5D754D23032D478ACFF23309011F77AD) | | |

| [PART IV](#sFFC7DE5B962B29FFD26533090E498992) | | |

| [Signature](#sA1FE4E7D088290F568A033090E97D826) | | [139](#sA1FE4E7D088290F568A033090E97D826) |

ITEMS 1., 1A., and 2.

| Aruba (c) | | Aruba | | 235,000 | |

| | | | | 1,840,000 | |

| | | | | 455,000 | |

| (c) | The operations of the Aruba Refinery were suspended in March 2012. For further discussion of this matter, see Note 4 in Notes to Consolidated Financial Statements. |

The West Refinery specializes in processing primarily sour crude oil and residual fuel oil into premium products such as RBOB (reformulated gasoline blendstock for oxygenate blending).

The refineries typically receive and deliver feedstocks and products by tanker and barge via

deepwater docking facilities along the Corpus Christi Ship Channel.

The refinery’s newest major unit is a 60,000 BPD hydrocracker (completed in 2012), constructed to expand the refinery’s yield of distillates.

Finished products are distributed into the Colonial, Explorer, and TEPPCO pipelines and across the refinery docks into ships or barges.

In 2013, we completed construction and placed into operation a 60,000 BPD hydrocracker at this refinery.

Our Meraux Refinery is located in St. Bernard Parish southeast of New Orleans.

The refinery receives crude oil at its marine dock and has access to the Louisiana Offshore Oil Port where it can receive crude oil via the Clovelly-Alliance-Meraux pipeline system.

Additionally, the refinery has recently installed processing equipment to facilitate the processing of lighter domestic crude oil.

A 70-mile pipeline transports crude oil via connections to the Three Rivers Refinery from Corpus Christi.

To capitalize on the increase in the production of domestic crude oil in South Texas, the refinery has installed facilities to receive increased volumes of domestic crude oil by truck and new third-party pipelines.

Aruba Refinery.

Our Aruba Refinery is located on the island of Aruba in the Caribbean Sea.

The refinery heretofore processed primarily heavy sour crude oil and produced intermediate feedstocks and finished distillate products.

The refinery receives crude oil by ship at its two deepwater marine docks, which can berth ultra-large crude carriers.

The operations of the Aruba Refinery were suspended in March 2012, and in September 2012, we reorganized the refinery into a crude oil and refined products terminal.

For additional information about this matter, see Note 4 of Notes to Consolidated Financial Statements.

The refinery also has access at Wichita Falls, Texas to third-party pipelines that transport crude oil from West Texas to the U.S. Mid-Continent region.

Local crude oil is gathered by Enterprise’s crude oil gathering/trunkline systems and trucking operations, and is then transported to the refinery through third-party crude oil pipelines.

It processes sweet, high mercaptan crude oils and lower-quality, sweet acidic crude oils, western Canadian synthetic oil, West Texas Intermediate (WTI) crude oil and shale oil into conventional gasoline, low-sulfur diesel, jet fuel, heating oil, and propane.

It processes sour crude oils into premium products, primarily CARBOB gasoline, a reformulated gasoline mixture that meets the specifications of the California Air Resources Board (CARB) when blended with ethanol.

As of January 31, [removed: 2014,] [added: 2015,] there were [removed: 6,628] [added: 6,213] holders of record of our common stock.

The following table shows the high and low sales prices of and dividends declared on our common stock for each quarter of [removed: 2013] [added: 2014] and [removed: 2012.][added: 2013.]

On January [removed: 22, 2014,] [added: 23, 2015,] our board of directors declared a quarterly cash dividend of [removed: $0.25] [added: $0.40] per common share payable March [removed: 12, 2014] [added: 3, 2015] to holders of record at the close of business on February [removed: 12, 2014.][added: 11, 2015.]

The following table discloses purchases of shares of Valero’s common stock made by us or on our behalf during the fourth quarter of [removed: 2013.][added: 2014.]

| (a) | The shares reported in this column represent purchases settled in the fourth quarter of [removed: 2013] [added: 2014] relating to (i) our purchases of shares in open-market transactions to meet our obligations under stock-based compensation plans, and (ii) our purchases of shares from our employees and non-employee directors in connection with the exercise of stock options, the vesting of restricted stock, and other stock compensation transactions in accordance with the terms of our stock-based compensation plans. |

| (b) | On [removed: April 26, 2007, we publicly announced an increase in our common stock purchase program from $2 billion to $6 billion, as authorized by our board of directors on April 25, 2007. During 2013, we completed the $6 billion program. On] February 28, 2008, we announced that our board of directors approved a $3 billion common stock purchase [removed: program, which was in addition to the $6 billion] program. This $3 billion program has no expiration date. |

The following line graph compares the cumulative total return1 on an investment in our common stock against the cumulative total return of the S&P 500 Composite Index and an index of peer companies (that we selected) for the five-year period commencing December 31, [removed: 2008] [added: 2009] and ending December 31, [removed: 2013.][added: 2014.]

Our peer group comprises the following 11 companies: Alon USA Energy, Inc.; BP plc; CVR Energy, Inc.; Delek US Holdings, [removed: Inc. (DK);] [added: Inc.;] HollyFrontier Corporation; Marathon Petroleum Corporation; PBF Energy [removed: Inc. (PBF);] [added: Inc.;] Phillips 66; Royal Dutch Shell plc; Tesoro Corporation; and Western Refining, Inc. [removed: Our peer group previously included Hess Corporation, but it has exited the refining business, and was replaced in our peer group by DK and PBF who are also engaged in refining operations.]

[removed: Old Peer Group,] and [removed: New] Peer Group

[removed: ][added: ]

| | [removed: 12/2008 | | | |] 12/2009 | | | | 12/2010 | | | | 12/2011 | | | | 12/2012 | | | | 12/2013 | | | [added: | 12/2014 | | |]

| 1 | Assumes that an investment in Valero common stock and each index was $100 on December 31, [removed: 2008.] [added: 2009.] “Cumulative total return” is based on share price appreciation plus reinvestment of dividends from December 31, [removed: 2008] [added: 2009] through December 31, [removed: 2013.] [added: 2014.] |

| 2014: | | | | | | | | | | | | |

| December 31 | | $ | 52.10 | | | $ | 42.53 | | | $ | 0.275 | |

| September 30 | | 54.61 | | | | 45.73 | | | | 0.275 | | |

| June 30 | | 59.69 | | | | 50.03 | | | | 0.250 | | |

| March 31 | | 55.96 | | | | 45.90 | | | | 0.250 | | |

| December 31 | | 50.54 | | | | 33.20 | | | | 0.225 | | |

| September 30 | | 37.50 | | | | 33.00 | | | | 0.225 | | |

| June 30 | | 45.53 | | | | 33.27 | | | | 0.200 | | |

| March 31 | | 48.97 | | | | 34.05 | | | | 0.200 | | |

| October 2014 | | 3,180,678 | | | $ | 46.27 | | | 302,005 | | | 2,878,673 | | | $ 1.8 billion |

| November 2014 | | 2,001,273 | | | $ | 50.32 | | | 119,047 | | | 1,882,226 | | | $ 1.7 billion |

| December 2014 | | 5,120,398 | | | $ | 48.56 | | | 2,624 | | | 5,117,774 | | | $ 1.5 billion |

| Total | | 10,302,349 | | | $ | 48.20 | | | 423,676 | | | 9,878,673 | | | $ 1.5 billion |

| Valero Common Stock | $ | 100.00 | | | $ | 139.54 | | | $ | 128.59 | | | $ | 213.68 | | | $ | 352.58 | | | $ | 353.43 | |

| S&P 500 | 100.00 | | | | 115.06 | | | | 117.49 | | | | 136.30 | | | | 180.44 | | | | 205.14 | | |

| Peer Group | 100.00 | | | | 93.33 | | | | 100.51 | | | | 109.79 | | | | 133.61 | | | | 123.08 | | |

____________________________________

| December 31 | | $ | 50.40 | | | $ | 33.73 | | | $ | 0.225 | |

| September 30 | | 37.13 | | | | 33.54 | | | | 0.225 | | |

| June 30 | | 44.97 | | | | 33.76 | | | | 0.200 | | |

| March 31 | | 48.51 | | | | 34.35 | | | | 0.200 | | |

| 2012: | | | | | | | | | | | | |

| December 31 | | 34.38 | | | | 28.20 | | | | 0.175 | | |

| September 30 | | 33.75 | | | | 23.64 | | | | 0.175 | | |

| June 30 | | 26.33 | | | | 20.37 | | | | 0.150 | | |

| March 31 | | 28.56 | | | | 19.61 | | | | 0.150 | | |

| October 2013 | | 2,692,850 | | | $ | 34.10 | | | 85,708 | | | 2,607,142 | | | $ 2.9 billion |

| November 2013 | | 2,413,232 | | | $ | 41.76 | | | 343,227 | | | 2,070,005 | | | $ 2.8 billion |

| December 2013 | | 3,172,462 | | | $ | 46.37 | | | 1,134 | | | 3,171,328 | | | $ 2.6 billion |

| Total | | 8,278,544 | | | $ | 41.04 | | | 430,069 | | | 7,848,475 | | | $ 2.6 billion |

| Valero Common Stock | $ | 100.00 | | | $ | 79.77 | | | $ | 111.31 | | | $ | 102.57 | | | $ | 170.45 | | | $ | 281.24 | |

| S&P 500 | 100.00 | | | | 126.46 | | | | 145.51 | | | | 148.59 | | | | 172.37 | | | | 228.19 | | |

| Old Peer Group | 100.00 | | | | 126.98 | | | | 122.17 | | | | 127.90 | | | | 138.09 | | | | 170.45 | | |

| New Peer Group | 100.00 | | | | 127.95 | | | | 120.42 | | | | 129.69 | | | | 136.92 | | | | 166.57 | | |

____________

The selected financial data for the five-year period ended December 31, [removed: 2013] [added: 2014] was derived from our audited financial statements.

| | Year Ended December 31, [added: (a)] | | | | | | | | | | | | | | | | | | |

| | [removed: 2013 (a)] [added: 2014 (b)] | | | | [removed: 2012 (b)] [added: 2013 (c)] | | | | [removed: 2011 (c)] [added: 2012] | | | | [removed: 2010] [added: 2011] (d) | | | | [removed: 2009 (d)] [added: 2010 (e)] | | |

| Earnings per common share from continuing operations – assuming dilution | [removed: 4.97] [added: 6.97] | | | | [removed: 3.75] [added: 4.96] | | | | [removed: 3.69] [added: 5.61] | | | | [removed: 1.62] [added: 4.11] | | | | [removed: (0.50] [added: 2.07] | | [removed: )] |

| Dividends per common share | [removed: 0.85] [added: 1.05] | | | | [removed: 0.65] [added: 0.85] | | | | [removed: 0.30] [added: 0.65] | | | | [removed: 0.20] [added: 0.30] | | | | [removed: 0.60] [added: 0.20] | | |

| Total assets | [removed: 47,260] [added: 45,550] | | | | [removed: 44,477] [added: 47,260] | | | | [removed: 42,783] [added: 44,477] | | | | [removed: 37,621] [added: 42,783] | | | | [removed: 35,572] [added: 37,621] | | |

| Debt and capital lease obligations, less current portion | [removed: 6,261] [added: 5,780] | | | | [removed: 6,463] [added: 6,261] | | | | [removed: 6,732] [added: 6,463] | | | | [removed: 7,515] [added: 6,732] | | | | [removed: 7,163] [added: 7,515] | | |

| [removed: (a)] [added: (c)] | Includes the operations of our retail business prior to its separation from us on May 1, 2013, as further described in Note 3 of Notes to Consolidated Financial Statements. |

| [removed: (b)] [added: (a)] | [removed: The operations of the Aruba Refinery were suspended in March 2012, as] [added: As] further described in Note [removed: 4] [added: 2] of Notes to Consolidated Financial [removed: Statements.] [added: Statements, the results of operations of the Aruba Refinery are reported as discontinued operations for all years presented.] |

| [removed: (c)] [added: (d)] | We acquired the Meraux Refinery on October 1, 2011 and the Pembroke Refinery on August 1, 2011. The information presented for 2011 includes the results of operations from these acquisitions commencing on their respective acquisition dates. |

| [removed: (d)] [added: (e)] | We acquired three ethanol plants in the first quarter of [removed: 2010 and seven ethanol plants in the second quarter of 2009.] [added: 2010.] The information presented for 2010 [removed: and 2009] includes the results of operations of these plants commencing on their respective acquisition dates. |

| Operating revenues | $ | 130,844 | | | $ | 138,074 | | | $ | 138,393 | | | $ | 120,607 | | | $ | 82,154 | |

| Income from continuing operations | 3,775 | | | | 2,722 | | | | 3,114 | | | | 2,336 | | | | 1,178 | | |

_________________________________________________

| (b) | We acquired an idled ethanol plant in the first quarter of 2014, and resumed production during the third quarter of 2014. The information presented in 2014 includes the results of operations for this plant commencing on its acquisition date. |

| | |

| --- | --- |

| Operating revenues | $ | 138,074 | | | $ | 139,250 | | | $ | 125,987 | | | $ | 82,233 | | | $ | 64,599 | |

| Income (loss) from continuing operations | 2,728 | | | | 2,080 | | | | 2,096 | | | | 923 | | | | (273 | | ) |

___________________________

Our management evaluated the effectiveness of Valero’s internal control over financial reporting as of December 31, [removed: 2013.][added: 2014.]

In its evaluation, management used the criteria established in Internal Control – Integrated Framework [removed: (1992)] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Management believes that as of December 31, [removed: 2013,] [added: 2014,] our internal control over financial reporting was effective based on those criteria.

Our independent registered public accounting firm has issued an attestation report on the effectiveness of our internal control over financial reporting, which begins on page [removed: 58] [added: [56](#s8d9441724c4740e8b1ae33191868728a)] of this report.

[removed: of] Valero Energy Corporation and subsidiaries:

We have audited the accompanying consolidated balance sheets of Valero Energy Corporation and subsidiaries (the Company) as of December 31, [removed: 2013] [added: 2014] and [removed: 2012,] [added: 2013,] and the related consolidated statements of income, comprehensive income, equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2013.][added: 2014.]

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Valero Energy Corporation and subsidiaries as of December 31, [removed: 2013] [added: 2014] and [removed: 2012,] [added: 2013,] and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, [removed: 2013,] [added: 2014,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the PCAOB, the Company’s internal control over financial reporting as of December 31, [removed: 2013,] [added: 2014,] based on criteria established in Internal Control – Integrated Framework [removed: (1992)] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February [removed: 27, 2014] [added: 26, 2015] expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

[removed: of] Valero Energy Corporation and subsidiaries:

We have audited Valero Energy [removed: Corporation and subsidiaries’] [added: Corporation’s] (the Company’s) internal control over financial reporting as of December 31, [removed: 2013,] [added: 2014,] based on criteria established in Internal Control – Integrated Framework [removed: (1992)] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, Valero Energy Corporation [removed: and subsidiaries] maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2013,] [added: 2014,] based on criteria established in Internal Control – Integrated Framework [removed: (1992)] [added: (2013)] issued by COSO.

We also have audited, in accordance with the standards of the PCAOB, the consolidated balance sheets of Valero Energy Corporation and subsidiaries as of December 31, [removed: 2013] [added: 2014] and [removed: 2012,] [added: 2013,] and the related consolidated statements of income, comprehensive income, equity, and cash flows for each of the years in the three-year period ended December 31, [removed: 2013,] [added: 2014,] and our report dated February [removed: 27, 2014] [added: 26, 2015] expressed an unqualified opinion on those consolidated financial statements.

[added: | 5. |] VALERO ENERGY [removed: CORPORATION][added: PARTNERS LP |]

| | [added: 2014 | | | |] 2013 | | | | 2012 | | |

| Cash and temporary cash investments | $ | [removed: 4,292] [added: 3,689] | | | $ | [removed: 1,723] [added: 4,292] | |

| Receivables, net | [removed: 8,751] [added: 5,879] | | | | [removed: 8,167] [added: 8,751] | | |

| Inventories | [removed: 5,758] [added: 6,623] | | | | [removed: 5,973] [added: 5,758] | | |

| Income taxes receivable | [removed: 72] [added: 97] | | | | [removed: 169] [added: 72] | | |

| Deferred income taxes | [removed: 266] [added: 162] | | | | [removed: 274] [added: 266] | | |

| Prepaid expenses and other | [removed: 138] [added: 164] | | | | [removed: 154] [added: 138] | | |

| Total current assets | [removed: 19,277] [added: 16,614] | | | | [removed: 16,460] [added: 19,277] | | |

| Property, plant, and equipment, at cost | [removed: 33,933] [added: 35,933] | | | | [removed: 34,132] [added: 33,933] | | |

| Accumulated depreciation | [removed: (8,226] [added: (9,198] | | ) | | [removed: (7,832] [added: (8,226] | | ) |

| Property, plant, and equipment, net | [removed: 25,707] [added: 26,735] | | | | [removed: 26,300] [added: 25,707] | | |

| [removed: Intangible assets, net | 156 | | | | 213 |] [added: •] | [added: intangible assets;] |

| Deferred charges and other assets, net | [removed: 2,120] [added: $] | [added: 7] | | | [removed: 1,504] [added: $] | [added: 208] | | [added: | $ | — | | | $ | — | |]

| Total assets | $ | [removed: 47,260] [added: 45,550] | | | $ | [removed: 44,477] [added: 47,260] | |

| Current portion of debt and capital lease obligations | $ | [removed: 303] [added: 606] | | | $ | [removed: 586] [added: 303] | |

| Accounts payable | [removed: 9,931] [added: 6,760] | | | | [removed: 9,348] [added: 9,931] | | |

| Accrued expenses | [removed: 522] [added: 596] | | | | [removed: 590] [added: 522] | | |

| Taxes other than income taxes | [removed: 1,345] [added: 1,209] | | | | [removed: 1,026] [added: 1,345] | | |

| Income taxes payable | [removed: 773] [added: 433] | | | | [removed: 1] [added: 773] | | |

| Deferred income taxes | [removed: 249] [added: 376] | | | | [removed: 378] [added: 249] | | |

| Total current liabilities | [removed: 13,123] [added: 9,980] | | | | [removed: 11,929] [added: 13,123] | | |

| Debt and capital lease obligations, less current portion | [removed: 6,261] [added: 5,780] | | | | [removed: 6,463] [added: 6,261] | | |

| Deferred income taxes | [removed: 6,601] [added: 6,607] | | | | [removed: 5,860] [added: 6,601] | | |

| Other long-term liabilities | [removed: 1,329] [added: 1,939] | | | | [removed: 2,130] [added: 1,329] | | |

| Additional paid-in capital | [removed: 7,187] [added: 7,116] | | | | [removed: 7,322] [added: 7,187] | | |

| Treasury stock, at cost; [removed: 137,932,138] [added: 159,202,872] and [removed: 121,406,520] [added: 137,932,138] common shares | [removed: (7,054] [added: (8,125] | | ) | | [removed: (6,437] [added: (7,054] | | ) |

| Retained earnings | [removed: 18,970] [added: 22,046] | | | | [removed: 17,032] [added: 18,970] | | |

February 26, 2015

February 26, 2015

| | 2014 | | | | 2013 | | |

| Operating revenues | $ | 130,844 | | | $ | 138,074 | | | $ | 138,393 | |

| Cost of sales | 118,141 | | | | 127,316 | | | | 126,485 | | |

| Refining | 3,900 | | | | 3,710 | | | | 3,513 | | |

| Total costs and expenses | 124,942 | | | | 134,117 | | | | 133,349 | | |

| Operating income | 5,902 | | | | 3,957 | | | | 5,044 | | |

| Continuing operations | $ | 3,694 | | | $ | 2,714 | | | $ | 3,117 | |

| Discontinued operations | (64 | | ) | | 6 | | | | (1,034 | | ) |

| Continuing operations | $ | 7.00 | | | $ | 4.98 | | | $ | 5.64 | |

| Continuing operations | $ | 6.97 | | | $ | 4.96 | | | $ | 5.61 | |

| Net income | — | | | | — | | | | — | | | | 3,630 | | | | — | | | | 3,630 | | | | 81 | | | | 3,711 | | |

| Stock repurchases under buyback program | — | | | | — | | | | (1,168 | | ) | | — | | | | — | | | | (1,168 | | ) | | — | | | | (1,168 | | ) |

| Balance as of December 31, 2014 | $ | 7 | | | $ | 7,116 | | | $ | (8,125 | ) | | $ | 22,046 | | | $ | (367 | ) | | $ | 20,677 | | | $ | 567 | | | $ | 21,244 | |

| Aruba Refinery asset retirement expense and other | 63 | | | | — | | | | — | | |

| Distributions to public unitholders of Valero Energy Partners LP | (12 | | ) | | — | | | | — | | |

As discussed in Note 2, in May 2014, we abandoned the Aruba Refinery.

As a result, the refinery’s results of operations have been presented as discontinued operations in the consolidated statements of income for all years presented.

The ownership of noncontrolling investors are recorded as noncontrolling interests.

meet our obligation.

Deferred tax assets are reduced by unrecognized tax benefits, if such items may be available to offset the unrecognized tax benefit.

The effective portion of the gain or

In April 2014, the provisions of Accounting Standards Codification (ASC) Topic 205, “Presentation of Financial Statements,” and ASC Topic 360, “Property, Plant, and Equipment,” were amended to change the criteria for reporting discontinued operations.

The provisions of these amendments modify the definition of discontinued operations by limiting discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have or will have a major effect on an entity’s operations and financial results.

These amendments require additional disclosures about discontinued operations and new disclosures for other disposals of individually material components of an organization that do not meet the definition of a discontinued operation.

In addition, the guidance allows companies to have significant continuing involvement and continuing cash flows with the discontinued operation.

The adoption of this guidance effective January 1, 2015 will not affect our financial position or results of operations; however, it may result in changes to the manner in which future dispositions of operations or assets, if any, are presented in our financial statements, or it may require additional disclosures.

In May 2014, the Financial Accounting Standards Board (FASB) amended the ASC and issued a new accounting standard, Topic 606, “Revenue from Contracts with Customers,” to clarify the principles for recognizing revenue.

The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

The standard also requires improved interim and annual disclosures that enable the users of financial statements to better understand the nature, amount, timing, and uncertainty of revenues and cash flows arising from contracts with customers.

The new standard is effective for annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period, and can be adopted either retrospectively to each prior reporting period presented using a practical expedient, as allowed by the new standard, or retrospectively with a cumulative effect adjustment to retained earnings as of the date of initial application.

Early adoption is not permitted.

We are currently evaluating the effect that adopting this new standard will have on our financial statements and related disclosures.

In January 2015, the provisions of ASC Subtopic 225-20, “Income Statement–Extraordinary and Unusual Items” were amended to eliminate the concept of extraordinary items from U.S. GAAP as part of the FASB’s simplification initiative.

The guidance eliminates the separate presentation of extraordinary items on the income statement, net of tax and the related earnings per share, but does not affect the requirement to disclose material items that are unusual in nature or infrequently occurring or to exclude those items from the estimated annual effective tax rate for interim reporting purposes.

These provisions may be applied prospectively or

retrospectively and are effective for annual reporting periods beginning after December 15, 2015, and interim periods within those annual periods, with early adoption permitted.

In February 2015, the provisions of ASC Topic 810, “Consolidation” were amended to improve consolidation guidance for certain types of legal entities.

The guidance modifies the evaluation of whether limited partnerships and similar legal entities are variable interest entities (VIEs) or voting interest entities, eliminates the presumption that a general partner should consolidate a limited partnership, affects the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships, and provides a scope exception from consolidation guidance for certain money market funds.

February 27, 2014

February 27, 2014

VALERO ENERGY CORPORATION

| Operating revenues | $ | 138,074 | | | $ | 139,250 | | | $ | 125,987 | |

| Cost of sales | 127,316 | | | | 127,268 | | | | 115,719 | | |

| Refining | 3,704 | | | | 3,668 | | | | 3,406 | | |

| Total costs and expenses | 134,111 | | | | 135,240 | | | | 122,307 | | |

| Operating income | 3,963 | | | | 4,010 | | | | 3,680 | | |

| Continuing operations | $ | 2,720 | | | $ | 2,083 | | | $ | 2,097 | |

| Continuing operations | $ | 4.99 | | | $ | 3.77 | | | $ | 3.70 | |

| Continuing operations | $ | 4.97 | | | $ | 3.75 | | | $ | 3.69 | |

VALERO ENERGY CORPORATION

VALERO ENERGY CORPORATION

| Balance as of December 31, 2010 | $ | 7 | | | $ | 7,704 | | | $ | (6,462 | ) | | $ | 13,388 | | | $ | 388 | | | $ | 15,025 | | | $ | — | | | $ | 15,025 | |

| Recognition of noncontrolling interests in Mainline Pipelines Limited in connection with Pembroke Acquisition | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | 5 | | | | 5 | | |

| Acquisition of noncontrolling interests in Mainline Pipelines Limited | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | (5 | | ) | | (5 | | ) |

VALERO ENERGY CORPORATION

| Loss on sales of refinery assets, net | — | | | | — | | | | 12 | | |

| Acquisition of Pembroke Refinery, net of cash acquired | — | | | | — | | | | (1,691 | | ) |

| Acquisition of Meraux Refinery | — | | | | — | | | | (547 | | ) |

| | |

| --- | --- |

General

| | |

| --- | --- |

| | |

| --- | --- |

| | |

| --- | --- |

We have evaluated subsequent events that occurred after December 31, 2013 through the filing of this Form 10-K.

Any material subsequent events that occurred during this time have been properly recognized or disclosed in these financial statements.

Noncontrolling Interests

Because of our controlling financial interest in each of the following entities, we have included their financial statements in our financial statements and have separately disclosed the related noncontrolling interests.

| | |

| --- | --- |

| • | Valero Energy Partners LP (VLP) is a master limited partnership formed in July 2013 to own, operate, develop, and acquire primarily fee-based crude oil and refined petroleum product pipelines and terminals. As further described in Note 5, VLP completed an initial public offering of its common units on December 16, 2013 and we owned a 70.6 percent controlling financial interest in VLP as of December 31, 2013. |

| | |

| --- | --- |

| • | Diamond Green Diesel Holdings LLC (DGD Holdings) is a 50/50 joint venture with Darling Green Energy LLC, a subsidiary of Darling International, Inc., that constructed and now operates a biomass- |

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Our management has evaluated, with the participation of our principal executive officer and principal financial officer, the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report, and has concluded that our disclosure controls and procedures were effective as of December 31, [removed: 2013.][added: 2014.]

The management report on Valero’s internal control over financial reporting required by Item 9A appears in Item 8 on page [removed: 56] [added: 54] of this report, and is incorporated herein by reference.

KPMG LLP’s report on Valero’s internal control over financial reporting appears in Item 8 beginning on page [removed: 58] [added: 56] of this report, and is incorporated herein by reference.

The information required by Items 10 through 14 of Form 10-K is incorporated herein by reference to the definitive proxy statement for our [removed: 2014] [added: 2015] annual meeting of stockholders.

We will file the proxy statement with the SEC before March 31, [removed: 2014.][added: 2015.]

| [Management’s report on internal control over financial [removed: reporting](#sBC7B30546DB188501AE133090498D542)] [added: reporting](#sA312BC231D85C18256B1AA65C0F9CEED)] | [removed: [56](#sBC7B30546DB188501AE133090498D542)] [added: [54](#sA312BC231D85C18256B1AA65C0F9CEED)] |

| [Reports of independent registered public accounting [removed: firm](#s6210F8DF53C5F48F9D7E330904A8F21C)] [added: firm](#s7ABD0890A4864713CEB6AA65C118D6AD)] | [removed: [57](#s6210F8DF53C5F48F9D7E330904A8F21C)] [added: [55](#s7ABD0890A4864713CEB6AA65C118D6AD)] |

| [Consolidated balance sheets as of December 31, [removed: 2013] [added: 2014] and [removed: 2012](#sDE8090664A5DB631424A3308BBF5053C)] [added: 2013](#s5619B8C9DEEA62B791CEAA6583CB9550)] | [removed: [60](#sDE8090664A5DB631424A3308BBF5053C)] [added: [58](#s5619B8C9DEEA62B791CEAA6583CB9550)] |

| [Consolidated statements of income for the years ended December 31, [added: 2014,] 2013, [removed: 2012,] and [removed: 2011](#s6826B22E31ADFA1FEC543308BC14BC81)] [added: 2012](#s8E962D38490BAC1260B7AA6583DA2FB5)] | [removed: [61](#s6826B22E31ADFA1FEC543308BC14BC81)] [added: [59](#s8E962D38490BAC1260B7AA6583DA2FB5)] |

| [Consolidated statements of comprehensive income for the years ended December 31, [added: 2014,] 2013, [removed: 2012,] and [removed: 2011](#s4BDB78B3893156AF275F3308BC24E6BA)] [added: 2012](#s1D80F694760778BB02C8AA6583EAA26B)] | [removed: [62](#s4BDB78B3893156AF275F3308BC24E6BA)] [added: [60](#s1D80F694760778BB02C8AA6583EAA26B)] |

| [Consolidated statements of equity for the years ended December 31, [added: 2014,] 2013, [removed: 2012,] and [removed: 2011](#s16584BCD954D0D6914FA3308BC33EFE0)] [added: 2012](#sA880AE979DD3DD91D4CAAA6583FA1AD9)] | [removed: [63](#s16584BCD954D0D6914FA3308BC33EFE0)] [added: [61](#sA880AE979DD3DD91D4CAAA6583FA1AD9)] |

| [Consolidated statements of cash flows for the years ended December 31, [added: 2014,] 2013, [removed: 2012,] and [removed: 2011](#s2F9CA09DFE1D26F457973308BCC07692)] [added: 2012](#sB8E985E5660504A60F41AA658476A365)] | [removed: [64](#s2F9CA09DFE1D26F457973308BCC07692)] [added: [62](#sB8E985E5660504A60F41AA658476A365)] |

| [Notes to consolidated financial [removed: statements](#s6D21A22D8CA006F26E953309061E5E0A)] [added: statements](#s4B1D10436E227D52F308AA65C270749F)] | [removed: [65](#s6D21A22D8CA006F26E953309061E5E0A)] [added: [63](#s4B1D10436E227D52F308AA65C270749F)] |

| 3.09 | | \-- | Amended and Restated Bylaws of Valero Energy Corporation - incorporated by reference to Exhibit [removed: 3.09] [added: 3.01] to Valero’s [removed: Annual] [added: Current] Report on Form [removed: 10-K for the year ended December 31, 2012] [added: 8-K dated January 23, 2015 and filed January 30, 2015] (SEC File No. 1-13175). |

| [removed: +10.11] [added: +10.23] | | \-- | [added: Form of Stock Option Agreement pursuant to the] Valero Energy Corporation [removed: Restricted] [added: Non-Employee Director] Stock [added: Option] Plan [removed: for Non-Employee Directors, as amended and restated July 11, 2007] - incorporated by reference to Exhibit [removed: 10.02] [added: 10.04] to Valero’s [removed: Current] [added: Quarterly] Report on Form [removed: 8-K/A dated July 11, 2007, and filed] [added: 10-Q for the quarter ended] September [removed: 18, 2007] [added: 30, 2006] (SEC File No. 1-13175). |

| [removed: +10.12] [added: +10.11] | | \-- | Form of Indemnity Agreement between Valero Energy Corporation (formerly known as Valero Refining and Marketing Company) and certain officers and directors - incorporated by reference to Exhibit 10.8 to Valero’s Registration Statement on Form S-1 (SEC File No. 333-27013) filed May 13, 1997. |

| [removed: +10.13] [added: +10.21] | | \-- | [removed: Schedule] [added: Form] of [removed: Indemnity Agreements] [added: Stock Option Agreement pursuant to the Valero Energy Corporation 2011 Omnibus Stock Incentive Plan] - incorporated by reference to Exhibit [removed: 10.14] [added: 10.21] to Valero’s Annual Report on Form 10-K for the year ended December 31, 2011 (SEC File No. 1-13175). |

| [removed: +10.14] [added: +10.13] | | \-- | [added: Form of] Change of Control Severance Agreement (Tier I) [removed: dated January 18, 2007,] between Valero Energy Corporation and [removed: William R. Klesse] [added: executive officer] - incorporated by reference to Exhibit 10.15 to Valero’s Annual Report on Form 10-K for the year ended December 31, 2011 (SEC File No. 1-13175). |

| +10.15 | | \-- | [removed: Schedule] [added: Form] of Change of Control Severance [removed: Agreements] [added: Agreement] (Tier [removed: I)] [added: II) between Valero Energy Corporation and executive officer] - incorporated by reference to Exhibit 10.16 to Valero’s Annual Report on Form 10-K for the year ended December 31, [removed: 2011] [added: 2013] (SEC File No. 1-13175). |

| [removed: *+10.19] [added: *+10.20] | | \-- | Form of Performance Share Award Agreement [added: (with Dividend Equivalent Award)] pursuant to the Valero Energy Corporation 2011 Omnibus Stock Incentive Plan. |

| [removed: +10.20] [added: +10.22] | | \-- | Form of [added: Performance] Stock Option Agreement pursuant to the Valero Energy Corporation 2011 Omnibus Stock Incentive Plan - incorporated by reference to Exhibit 10.21 to Valero’s Annual Report on Form 10-K for the year ended December 31, [removed: 2011] [added: 2012] (SEC File No. 1-13175). |

| [removed: +10.21] [added: +10.19] | | \-- | Form of Performance [removed: Stock Option] [added: Share Award] Agreement pursuant to the Valero Energy Corporation 2011 Omnibus Stock Incentive Plan - incorporated by reference to Exhibit [removed: 10.21] [added: 10.19] to Valero’s Annual Report on Form 10-K for the year ended December 31, [removed: 2012] [added: 2013] (SEC File No. 1-13175). |

| [removed: *10.27] [added: 10.26] | | \-- | $3,000,000,000 5-Year Second Amended and Restated Revolving Credit Agreement, dated as of November 22, 2013, among Valero Energy Corporation, as Borrower; JPMorgan Chase Bank, N.A., as Administrative Agent; and the lenders named [removed: therein.] [added: therein - incorporated by reference to Exhibit 10.27 to Valero’s Annual Report on Form 10-K for the year ended December 31, 2013 (SEC File No. 1-13175).] |

| *23.01 | | \-- | Consent of KPMG LLP dated February [removed: 27, 2014.] [added: 26, 2015.] |

| *24.01 | | \-- | Power of Attorney dated February [removed: 27, 2014] [added: 26, 2015] (on the signature page of this Form 10-K). |

| | | [removed: Chief Executive Officer and] Chairman of the [removed: Board] [added: Board, President, and Chief Executive Officer] |

Date: February [removed: 27, 2014][added: 26, 2015]

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints [removed: William R.][added: Joseph W.]

| /s/ [removed: William R. Klesse] [added: Joseph W. Gorder] | | [removed: Chief Executive Officer and] Chairman of the [removed: Board] [added: Board, President, and Chief Executive Officer] (Principal Executive Officer) | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Michael S. Ciskowski | | Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Jerry D. Choate | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Deborah P. Majoras | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Donald L. Nickles | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Philip J. Pfeiffer | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Robert A. Profusek | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Susan Kaufman Purcell | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Stephen M. Waters | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Randall J. Weisenburger | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| /s/ Rayford Wilkins, Jr. | | Director | | February [removed: 27, 2014] [added: 26, 2015] |

| *+10.12 | | \-- | Schedule of Indemnity Agreements. |

| *+10.14 | | \-- | Schedule of Change of Control Severance Agreements (Tier I). |

| *+10.16 | | \-- | Schedule of Change of Control Severance Agreements (Tier II). |

| *99.01 | | \-- | Audit Committee Pre-Approval Policy. |

| | By: | /s/ Joseph W. Gorder |

| | | (Joseph W. Gorder) |

Gorder, Michael S.

| (Joseph W. Gorder) | | | | |

| | | | |

| *+10.16 | | \-- | Change of Control Severance Agreement (Tier II) dated March 15, 2007, between Valero Energy Corporation and Jay D. Browning. |

| +10.22 | | \-- | Form of Stock Option Agreement pursuant to the Valero Energy Corporation Non-Employee Director Stock Option Plan - incorporated by reference to Exhibit 10.04 to Valero’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 (SEC File No. 1-13175). |

| +10.23 | | \-- | Form of Restricted Stock Agreement pursuant to the Valero Energy Corporation 2005 Omnibus Stock Incentive Plan - incorporated by reference to Exhibit 10.02 to Valero’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2005 (SEC File No. 1-13175). |

| +10.26 | | \-- | Form of Restricted Stock Agreement pursuant to the Valero Energy Corporation Restricted Stock Plan for Non-Employee Directors - incorporated by reference to Exhibit 10.03 to Valero’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2006 (SEC File No. 1-13175). |

| 99.01 | | \-- | Audit Committee Pre-Approval Policy - incorporated by reference to Exhibit 99.01 to Valero’s Annual Report on Form 10-K for the year ended December 31, 2011 (SEC File No. 1-13175). |

| | By: | /s/ William R. Klesse |

| | | (William R. Klesse) |

Klesse, Michael S.

| | | | | |

| | | | | |

| (William R. Klesse) | | | | |

| /s/ Ruben M. Escobedo | | Director | | February 27, 2014 |

| (Ruben M. Escobedo) | | | | |

| /s/ Bob Marbut | | Director | | February 27, 2014 |

| (Bob Marbut) | | | | |