Sunoco 2014 Annual Report Download - page 20

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A material decrease in demand driven by unfavorable crude oil prices could materially and adversely affect our results of
operations, financial position or cash flows.
The volume of crude oil transported through our crude oil pipelines, terminal facilities and acquisition and marketing
assets depends on the availability of attractively priced crude oil produced or received in the areas served by our assets. A
period of sustained crude oil price declines could lead to a decline in drilling activity, production and import levels in these
areas. Similarly, a period of sustained increases in the price of crude oil supplied from any of these areas, as compared to
alternative sources of crude oil available to our customers, could materially reduce demand for crude oil in the these areas. In
either case, the volumes of crude oil transported in our crude oil pipelines, terminal facilities and acquisition and marketing
assets could decline, and it could likely be difficult to secure alternative sources of attractively priced crude supply in a timely
fashion or at all. If we are unable to replace any significant volume declines with additional volumes from other sources, our
results of operations, financial position or cash flows could be materially and adversely affected.
A material decrease in demand resulting from unfavorable natural gas liquids (“NGLs”) prices could materially and
adversely affect our results of operations, financial position, or cash flows.
Any significant and prolonged change in the actual or expected demand for NGLs could have an adverse impact on the
volumes transported in our pipelines, through our terminals, or bought and sold through our acquisition and marketing assets.
Changes in demand could result from additional regulatory restrictions on the extraction of NGLs that would significantly
increase the cost of extraction and procurement; changes in technology affecting the mix of energy products available; or
changes in laws, regulations, or costs related to exportation. Any material decrease in demand could have a material adverse
effect on our results of operations, financial position, or cash flows.
Any reduction in throughput capacity available to our shippers, including our crude oil, refined products and NGLs
acquisition and marketing businesses, on either our pipelines or interconnecting third-party pipelines could cause a
reduction of volumes transported in our pipelines and through our terminals.
Users of our pipelines and terminals are dependent upon our pipelines, as well as connections to third-party pipelines, to
receive and deliver crude oil, refined products and NGLs. Any interruptions or reduction in the capabilities of our pipelines or
these interconnecting pipelines due to testing, line repair, reduced operating pressures, or other causes would result in reduced
volumes transported in our pipelines or through our terminals. If additional shippers begin transporting volume over
interconnecting pipelines, the allocations to our existing shippers on these interconnecting pipelines could be reduced, which
also could reduce volumes transported in our pipelines or through our terminals. Allocation reductions of this nature are not
infrequent and are beyond our control. Any such interruptions or allocation reductions that, individually or in the aggregate, are
material or continue for a sustained period of time could have a material adverse effect on our results of operations, financial
position, or cash flows.
Similarly, our crude oil, refined products and NGLs acquisition and marketing businesses are dependent upon our and
third-party pipelines to transport their products. Any material interruptions or allocations that affect the ability of those
businesses to transport products, or the cost of such transportation, could have a material adverse effect on our results of
operations, financial position, or cash flows.
If we are unable to complete capital projects at their expected costs and/or in a timely manner, or if the market conditions
assumed in our project economics deteriorate, our results of operations, financial condition, or cash flows could be affected
materially and adversely.
Delays or cost increases related to capital spending programs involving construction of new facilities (or improvements
and repairs to our existing facilities) could adversely affect our ability to achieve forecasted operating results. Although we
evaluate and monitor each capital spending project and try to anticipate difficulties that may arise, such delays or cost increases
may arise as a result of factors that are beyond our control, including:
• denial or delay in issuing requisite regulatory approvals and/or permits;
• unplanned increases in the cost of construction materials or labor;
• disruptions in transportation of modular components and/or construction materials;
• severe adverse weather conditions, natural disasters, or other events (such as equipment malfunctions, explosions,
fires, releases) affecting our facilities, or those of vendors and suppliers;
• shortages of sufficiently skilled labor, or labor disagreements resulting in unplanned work stoppages;
• changes in market conditions impacting long lead-time projects;
• market-related increases in a project's debt or equity financing costs; and