Sunoco 2011 Annual Report Download - page 81

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the Partnership purchased additional ownership interests from a third party for $30 million. The Partnership’s
total ownership interest in Inland increased to 84 percent after it purchased all of Sunoco’s interests. As a result
of these transactions, Inland became a consolidated subsidiary of Sunoco and, in connection therewith, Sunoco
recognized a $9 million gain ($6 million after tax) from the remeasurement of its pre-acquisition equity interests
in Inland to fair value upon consolidation. This gain is reported separately in the consolidated statements of
operations.
In August 2011, the Partnership acquired a crude oil purchasing and marketing business from Texon L.P.
(“Texon”) for $222 million including $17 million attributable to the fair value of crude oil inventory. The
purchase consists of a lease crude business and gathering assets in 16 states, primarily in the western United
States. The current crude oil volume of the business is approximately 75 thousand barrels per day at the
wellhead.
Also in August 2011, the Partnership acquired a refined products terminal located in East Boston, MA
(“East Boston Terminal”) from affiliates of ConocoPhillips for $73 million including $17 million attributable to
the fair value of inventory. The terminal is the sole service provider of Logan International Airport under a long-
term contract.
In July 2010, the Partnership acquired a butane blending business from Texon for $152 million including
inventory. The acquisition includes patented technology for blending butane into gasoline, contracts with
customers currently utilizing the patented technology, butane inventories and other related assets. The
Partnership also increased its ownership interest in a pipeline joint venture for $6 million in July 2010. This
interest continues to be accounted for as an equity method investment.
The Partnership also exercised its rights to acquire additional ownership interests in Mid-Valley Pipeline
Company (“Mid-Valley”) and West Texas Gulf Pipe Line Company (“WTG”) for a total of $85 million during
the third quarter of 2010, increasing its ownership interests in Mid-Valley and WTG to 91 and 60 percent,
respectively. Since the Partnership obtained a controlling financial interest in both Mid-Valley and WTG, the
joint ventures were both reflected as consolidated subsidiaries of Sunoco from the dates of their respective
acquisitions. In connection with these acquisitions, Sunoco recognized a $128 million pretax gain ($37 million
after tax attributable to Sunoco shareholders) from the remeasurement of the pre-acquisition equity interests in
Mid-Valley and WTG to fair value upon consolidation. The fair value of such interests was determined based on
the amounts paid by the Partnership in connection with the exercise of its acquisition rights. This gain is reported
separately in the consolidated statements of operations.
In December 2010, Sunoco acquired 25 retail locations consisting of assets located in the Buffalo, Syracuse,
Albany, and Rochester markets of central and northern New York for $25 million including inventory.
73