Sunoco 2010 Annual Report Download - page 18

In March 2010, Sunoco completed the sale of the common stock of its polypropylene chemicals business to
Braskem S.A. (“Braskem”). The assets sold as part of this transaction included the polypropylene manufacturing
facilities in LaPorte, TX, Neal, WV, and Marcus Hook, PA, a propylene supply agreement and related inventory.
Cash proceeds from this divestment of $348 million were received in the second quarter of 2010. Sunoco
recognized a net loss of $44 million after tax related to the divestment. The loss is shown separately in Corporate
and Other in the Earnings Profile of Sunoco Businesses. Sunoco retained its phenol and derivatives business. As
a result of the sale, the polypropylene chemicals business has been classified as a discontinued operation for all
periods presented in the Consolidated Financial Statements included in Item 8.
During March 2009, the Bayport, TX polypropylene plant was permanently shut down because it had
become uneconomic to operate and in 2008 it was also determined that the goodwill related to its polypropylene
business no longer had value. In connection therewith, in 2009, the Company recorded a $4 million after-tax
accrual for a take-or-pay contract loss, employee terminations and other exit costs in connection with the
shutdown of the Bayport facility and, in 2008, recorded a $54 million after-tax provision to write down the
affected Bayport assets to estimated fair value and to write off the remaining polypropylene business goodwill.
These items are included as part of the Asset Write-Downs and Other Matters for discontinued polypropylene
operations reported separately in Corporate and Other in the Earnings Profile of Sunoco Businesses.
As a result of the sale to Braskem, the polypropylene business (including Bayport) has been classified as a
discontinued operation for all periods presented in the Consolidated Financial Statements included in Item 8.
The following table sets forth information concerning petrochemicals production by the Chemicals business
(excluding polypropylene operations) (in millions of pounds):
Capacity at
December 31, 2010
Production
2010 2009 2008
Phenol ....................................... 1,775 1,327 1,042 1,379
Acetone ...................................... 1,083 819 642 852
Bisphenol-A .................................. 240 210 184 219
Other Phenol Derivatives ........................ 120 63 47 62
Total Production ............................. 3,218 2,419 1,915 2,512
Less: Production Used as Feedstocks* .............. 238 207 246
Total Production Available for Sale .............. 2,181 1,708 2,266
*Includes phenol and acetone (used in the manufacture of bisphenol-A).
Petrochemical products produced by the Chemicals business are distributed and sold on a worldwide basis
with most of the sales made to customers in the United States. Excluding polypropylene operations, Chemicals
had sales of petrochemicals to third parties amounting to 2,152, 1,774 and 2,274 million pounds in 2010, 2009
and 2008, respectively.
Long-term phenol contract sales to Honeywell are used in nylon production. Other phenol contract sales are
to large manufacturers of resins and adhesives primarily for use in building products. Large contract sales of
acetone are to major customers who manufacture polymers. Other sales of acetone are made to smaller customers
for use in inks, paints, varnishes and adhesives. Bisphenol-A is sold to manufacturers of epoxy resins and
polycarbonates.
Coke
SunCoke Energy, Inc., through its affiliates (individually and collectively, “SunCoke Energy”), owns and
operates metallurgical coke plants located in Vansant, VA (Jewell), East Chicago, IN (Indiana Harbor), Franklin
Furnace, OH (Haverhill) and Granite City, IL (Gateway) and metallurgical coal mines located in Virginia and
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