Sunoco 2013 Annual Report Download - page 20

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A material decrease in demand or distribution of crude oil available for transport through our pipelines or terminal facilities
could materially and adversely affect our results of operations, financial position, or cash flows.
The volume of crude oil transported through our crude oil pipelines and terminal facilities depends on the availability of
attractively priced crude oil produced or received in the areas serviced by our assets. A period of sustained crude oil price
declines could lead to a decline in drilling activity, production and import levels in these areas. Similarly, a period of sustained
increases in the price of crude oil supplied from any of these areas, as compared to alternative sources of crude oil available to
our customers, could materially reduce demand for crude oil in these areas. In either case, the volumes of crude oil transported
in our crude oil pipelines and terminal facilities could decline, and it could likely be difficult to secure alternative sources of
attractively priced crude oil supply in a timely fashion or at all. If we are unable to replace any significant volume declines with
additional volumes from other sources, our results of operations, financial position, or cash flows could be materially and
adversely affected.
Any reduction in throughput capacity available to our shippers, including our crude oil and refined products acquisition
and marketing businesses, on either our pipelines or interconnecting third-party pipelines could cause a reduction of
volumes transported in our pipelines and through our terminals.
Users of our pipelines and terminals are dependent upon our pipelines, as well as connections to third-party pipelines, to
receive and deliver crude oil and refined products. Any interruptions or reduction in the capabilities of our pipelines or these
interconnecting pipelines due to testing, line repair, reduced operating pressures, or other causes would result in reduced
volumes transported in our pipelines or through our terminals. If additional shippers begin transporting volume over
interconnecting pipelines, the allocations to our existing shippers on these interconnecting pipelines could be reduced, which
also could reduce volumes transported in our pipelines or through our terminals. Allocation reductions of this nature are not
infrequent and are beyond our control. Any such interruptions or allocation reductions that, individually or in the aggregate, are
material or continue for a sustained period of time could have a material adverse effect on our results of operations, financial
position, or cash flows.
Similarly, our crude oil and refined products acquisition and marketing businesses are dependent upon our and third-party
pipelines to transport their products. Any material interruptions or allocations that affect the ability of those businesses to
transport products, or the cost of such transportation, could have a material adverse effect on our results of operations, financial
position, or cash flows.
A material decrease in demand for natural gas liquids ("NGLs") in the markets served by our assets could materially and
adversely affect our results of operations, financial position, or cash flows.
Any significant and prolonged change in the actual or expected demand for NGLs could have an adverse impact on the
volumes transported in our pipelines or through our terminals. Changes in demand could result from additional regulatory
restrictions on the extraction of NGLs that would significantly increase the cost of extraction and procurement; changes in
technology affecting the mix of energy products available; or changes in laws or regulations or costs related to exportation. Any
material decrease in demand could have a material adverse effect on our results of operations, financial position, or cash flows.
If we are unable to complete capital projects at their expected costs and/or in a timely manner, or if the market conditions
assumed in our project economics deteriorate, our results of operations, financial condition, or cash flows could be affected
materially and adversely.
Delays or cost increases related to capital spending programs involving construction of new facilities (or improvements
and repairs to our existing facilities) could adversely affect our ability to achieve forecasted operating results. Although we
evaluate and monitor each capital spending project and try to anticipate difficulties that may arise, such delays or cost increases
may arise as a result of factors that are beyond our control, including:
• denial or delay in issuing requisite regulatory approvals and/or permits;
• unplanned increases in the cost of construction materials or labor;
• disruptions in transportation of modular components and/or construction materials;
• severe adverse weather conditions, natural disasters, or other events (such as equipment malfunctions explosions, fires,
releases) affecting our facilities, or those of vendors and suppliers;
• shortages of sufficiently skilled labor, or labor disagreements resulting in unplanned work stoppages;
• changes in market conditions impacting long lead-time projects;
• market-related increases in a project's debt or equity financing costs; and
• nonperformance by, or disputes with, vendors, suppliers, contractors, or sub-contractors involved with a project.