Sunoco 2010 Annual Report Download - page 17

products terminal facilities and certain other related assets located in Texas and Louisiana from affiliates of
Exxon Mobil Corporation for $185 million. The Partnership intends to take advantage of additional growth
opportunities in the future, both within its current system and with third-party acquisitions.
At December 31, 2010, the Partnership owned and operated approximately 5,400 miles of crude oil
pipelines and approximately 2,200 miles of refined product pipelines. In 2010, crude oil and refined product
shipments on these pipelines totaled 23.3 and 18.5 billion barrel miles, respectively, as compared to 21.4 and
21.1 billion barrel miles in 2009 and 24.5 and 17.2 billion barrel miles in 2008. These amounts represent 100
percent of the pipeline shipments of these pipelines.
Product terminalling operations include 42 active terminals in the Northeast, Midwest and Southwest United
States that receive refined products from pipelines and distribute them to Sunoco and to third parties, who in turn
make deliveries to end-users such as retail outlets. Certain product terminals also provide ethanol blending and
other product additive services. During 2010, 2009 and 2008, throughput at these product terminals totaled 488,
462 and 436 thousand barrels daily, respectively. Terminalling operations also include an LPG terminal near
Detroit, MI, a crude oil terminal complex adjacent to Sunoco’s Philadelphia refinery and a refined products
terminal adjacent to Sunoco’s Marcus Hook refinery. During 2010, 2009 and 2008, throughput at these other
terminals totaled 465, 591 and 653 thousand barrels daily, respectively.
The Partnership’s Nederland, TX terminal provides approximately 20 million barrels of storage and
provides terminalling throughput capacity exceeding one million barrels per day. Its Gulf Coast location provides
local, south central and midwestern refiners access to foreign and offshore domestic crude oil. The facility is also
a key link in the distribution system for U.S. government purchases for and sales from certain Strategic
Petroleum Reserve storage facilities. During 2010, 2009 and 2008, throughput at the Nederland terminal totaled
728, 597 and 526 thousand barrels daily, respectively. During 2009, the Partnership completed its construction of
new crude oil storage tanks, four of which were placed into service in 2007, three in 2008 and four in 2009. The
Partnership also completed construction of a crude oil pipeline from the Nederland terminal to Motiva Enterprise
LLC’s Port Arthur, TX refinery and three related storage tanks with a combined capacity of 2.0 million barrels in
2009 at a total cost of $94 million.
The Partnership’s crude oil pipeline operations in the Southwest United States are complemented by crude
oil acquisition and marketing operations. During 2010, 2009 and 2008, approximately 189, 181 and 177 thousand
barrels daily, respectively, of crude oil were purchased (including exchanges) from third-party leases and
approximately 449, 411 and 402 thousand barrels daily, respectively, were purchased in bulk or other exchange
transactions. Purchased crude oil is delivered to various trunk pipelines either directly from the wellhead through
gathering pipelines or utilizing the Partnership’s fleet of trucks or third-party trucking operations.
Sunoco has agreements with the Partnership which establish fees for administrative services provided by
Sunoco to the Partnership and provide indemnifications by Sunoco for certain environmental, toxic tort and other
liabilities.
Chemicals
The Chemicals business manufactures, distributes and markets commodity and intermediate petrochemicals.
As of March 31, 2010 (see below), the chemicals consist of aromatic derivatives including phenol, acetone,
bisphenol-A, and other phenol derivatives. Phenol and acetone are produced at facilities in Philadelphia, PA and
Haverhill, OH. (See “Refining and Supply” for a discussion of the commodity petrochemicals produced by
Refining and Supply at the Marcus Hook, Philadelphia and Toledo refineries.)
Sunoco’s Philadelphia phenol facility has the capacity to produce annually more than one billion pounds of
phenol and 700 million pounds of acetone. Under a long-term contract, the Chemicals business supplies
Honeywell International Inc. (“Honeywell”) with approximately 745 million pounds of phenol annually at a price
based on the market value of cumene feedstock plus an amount approximating other phenol production costs.
9