Sunoco 2008 Annual Report Download - page 82

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6. Inventories
Inventories consisted of the following components (in millions of dollars):
December 31
2008 2007
Crude oil ..................................................... $303 $ 341
Petroleum and chemical products ................................. 327 647
Materials, supplies and other ..................................... 191 162
$821 $1,150
The current replacement cost of all inventories valued at LIFO exceeded their carrying value by $1,400 and
$3,868 million at December 31, 2008 and 2007, respectively. During 2008 and 2007, Sunoco reduced certain
inventory quantities which were valued at either higher or lower LIFO costs prevailing in prior years. The effect
of these reductions was to (decrease) increase 2008 and 2007 results of operations by $(28) and $21 million after
tax, respectively. In 2008, Sunoco also recorded a $20 million provision ($12 million after tax) to write down its
chemical products inventory to market value.
7. Investments and Long-Term Receivables
Investments and long-term receivables consisted of the following components (in millions of dollars):
December 31
2008 2007
Investments in affiliated companies:
Pipeline joint ventures (Notes 2 and 3) ........................... $ 85 $ 88
Brazilian cokemaking operations ................................ 41 41
Other ...................................................... 25 25
151 154
Accounts and notes receivable ................................... 22 21
$173 $175
Dividends received from affiliated companies amounted to $23, $25 and $41 million in 2008, 2007 and
2006, respectively. Retained earnings at December 31, 2008 include $35 million of undistributed earnings of
affiliated companies.
Sunoco is the operator of a cokemaking plant in Vitória, Brazil which commenced operations in 2007.
During 2007, Sunoco increased its investment in the project company that owns the Vitória facility by becoming
the sole subscriber of preferred shares for a total equity interest of $41 million. The project company is a variable
interest entity for which Sunoco is not the primary beneficiary.
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