Sunoco 2008 Annual Report Download - page 53

Contractual Obligations—The following table summarizes the Company’s significant contractual
obligations (in millions of dollars):
Total
Payment Due Dates
2009 2010-2011 2012-2013 Thereafter
Total debt:
Principal .................................. $ 2,163 $ 458 $ 186 $ 611 $ 908
Interest ................................... 572 100 180 118 174
Operating leases* ............................ 929 167 240 119 403
Purchase obligations:
Crude oil, other feedstocks and
refined products** ........................ 6,979 4,094 851 582 1,452
Convenience store items*** .................. 149 149 — — —
Transportation and distribution ................ 1,517 295 412 229 581
Fuel and utilities ............................ 114 59 55 — —
Obligations supporting financing
arrangements†........................... 60 9 18 15 18
Properties, plants and equipment .............. 223 212 11 — —
Other ..................................... 211 50 48 38 75
$12,917 $5,593 $2,001 $1,712 $3,611
*Includes $204 million pertaining to lease extension options which are assumed to be exercised.
**Includes feedstocks for chemical manufacturing and coal purchases for cokemaking operations.
***Actual amounts will vary based upon the number of Company-operated convenience stores and the level of purchases.
†Represents fixed and determinable obligations to secure wastewater treatment services at the Toledo refinery and coal handling
services at the Indiana Harbor cokemaking facility.
Sunoco’s operating leases include leases for marine transportation vessels, service stations, office space and
other property and equipment. Operating leases include all operating leases that have initial noncancelable terms
in excess of one year. Approximately 29 percent of the $929 million of future minimum annual rentals relates to
time charters for marine transportation vessels. Most of these time charters contain terms of between three to
seven years with renewal and sublease options. The time charter leases typically require a fixed-price payment or
a fixed-price minimum and a variable component based on spot-market rates. In the table above, the variable
component of the lease payments has been estimated utilizing the average spot-market prices for the year 2008.
The actual variable component of the lease payments attributable to these time charters could vary significantly
from the estimates included in the table.
A purchase obligation is an enforceable and legally binding agreement to purchase goods or services that
specifies significant terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable
price provisions; and the approximate timing of the transaction. Sunoco has various obligations to purchase in the
ordinary course of business: crude oil, other feedstocks and refined products; convenience store items;
transportation and distribution services, including pipeline and terminal throughput and railroad services; and
fuel and utilities. Approximately one third of the contractual obligations to purchase crude oil, other feedstocks
and refined products reflected in the above table for 2009 relates to spot-market purchases to be satisfied within
the first 60-90 days of the year. Sunoco also has contractual obligations supporting financing arrangements of
third parties, contracts to acquire or construct properties, plants and equipment, and other contractual obligations,
primarily related to services and materials, including commitments to purchase supplies and various other
maintenance, systems and communications services. Most of Sunoco’s purchase obligations are based on market
prices or formulas based on market prices. These purchase obligations generally include fixed or minimum
volume requirements. The purchase obligation amounts in the table above are based on the minimum quantities
to be purchased at estimated prices to be paid based on current market conditions. Accordingly, the actual
amounts may vary significantly from the estimates included in the table.
45