PBF Energy 2012 Annual Report Download - page 153

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PAULSBORO REFINING BUSINESS
NOTES TO FINANCIAL STATEMENTS—(Continued)
3 - SALE OF BUSINESS
On December 17, 2010, the Business was sold to PBF Holding for $661 million of proceeds, of which
$160 million consisted of a short-term note. Working capital, consisting primarily of inventory, was included as
part of this transaction. On December 16, 2010, the Business recorded an impairment charge of $896 million to
reflect the reduction in the carrying value of its assets.
4 - INVENTORIES
Inventories consisted of the following (in thousands):
December 16,
2010
Refinery feedstocks ............................................................... $ 50,604
Refined products and blendstocks .................................................... 92,664
Materials and supplies ............................................................. 12,064
Inventories .................................................................. $155,332
A reduction in inventory volumes during the period from January 1, 2010 through December 16, 2010 and for the
year ended December 31, 2009 resulted in a liquidation of LIFO inventory layers that were established in prior
years. The effect of these liquidations was to decrease cost of sales by $20.8 million for the period from
January 1, 2010 through December 16, 2010.
As of December 16, 2010, the replacement cost (market value) of LIFO inventories exceeded their LIFO carrying
amounts by approximately $171.3 million.
5 - PROPERTY, PLANT AND EQUIPMENT
Major classes of property, plant and equipment consisted of the following (in thousands):
Estimated
Useful Lives
December 16,
2010
Land .............................................................. $ 7,564
Crude oil processing facilities .......................................... 25years 1,410,361
Buildings ........................................................... 40–42years 3,005
Precious metals ...................................................... 5,231
Other .............................................................. 5–20years 51,518
Construction in progress ............................................... 63,664
Asset impairment .................................................... (1,200,107)
Property, plant and equipment, at cost ................................ 341,236
Accumulated depreciation ......................................... —
Property, plant and equipment, net ............................... $ 341,236
The Business leased an oxygen facility under a capital lease that is discussed further in Note 8. The capital lease,
which is included above in “other,” had a net book value of $0.2 million, net of accumulated amortization of
$0.1 million, as of December 16, 2010.
Depreciation expense for the period from January 1, 2010 through December 16, 2010 was $52.1 million.
F-61