Sunoco 2008 Annual Report Download - page 40

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Sunoco has undertaken the following initiatives as part of this strategy:
In the Refining and Supply business:
• Announced in December 2008 its intention to sell the Tulsa refinery or convert it to a terminal by
the end of 2009;
• Completed a $525 million project in May 2007 to expand the capacity of one of the fluid catalytic
cracking units at the Philadelphia refinery by 15 thousand barrels per day, which enables an
upgrade of an additional 15-20 thousand barrels per day of residual fuel production into higher-
value gasoline and distillate production and expands crude oil flexibility;
• Completed a $53 million project in July 2007 at the Toledo refinery, which expands the facility’s
crude processing capability by 10 thousand barrels per day. In 2008, additional work was
performed at this facility to expand crude processing capability by an additional 5 thousand
barrels per day; and
• Completed capital projects in 2006 totaling $755 million to comply with the Tier II low-sulfur
gasoline and on-road diesel fuel requirements.
In the Retail Marketing business:
• Continued to execute a Retail Portfolio Management program in 2008 designed to enhance overall
return on capital employed in the business. Under this program, Sunoco is selectively reducing its
invested capital in Company-owned or leased sites, while retaining most of the gasoline sales
volumes attributable to the divested sites. During the 2006-2008 period, Sunoco generated $133
million of divestment proceeds related to the sale of 181 sites. In early 2009, Sunoco announced
the addition of approximately 150 sites to the program and expects to generate an estimated $180
million of proceeds, primarily over the next two years, from divestment activities.
In the Chemicals business:
• Announced in December 2008 its decision to sell the business if it can obtain an appropriate
value; and
• Announced in January 2009 its decision to permanently shut down the Bayport, TX polypropylene
plant no later than April 30, 2009.
In the Logistics business:
• Completed an acquisition totaling $185 million in November 2008 of a refined products pipeline
system, refined products terminal facilities and certain other related assets located in Texas and
Louisiana;
• Continued construction in 2008 of a crude oil pipeline from the Nederland terminal to Motiva
Enterprise LLC’s Port Arthur, TX refinery and three related crude oil storage tanks, which are to
be completed in 2010 at a cost of approximately $90 million; and
• Completed acquisitions totaling $109 million in March 2006 of two crude oil pipeline systems and
related storage facilities located in Texas.
In the Coke business:
• Commenced construction in 2008 of a 650 thousand tons-per-year cokemaking facility in Granite
City, IL. SunCoke Energy will own and operate the new facility, which is expected to cost
approximately $300 million and be completed in the fourth quarter of 2009;
• Entered into an agreement in 2008 to build, own and operate a 550 thousand tons-per-year
cokemaking facility and associated cogeneration power plant capable of providing 46 megawatts
of power in Middletown, OH. Construction of these facilities, which is expected to cost
approximately $350 million, is subject to resolution of all contingencies, including necessary
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