Sunoco 2014 Annual Report Download - page 59

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not expected to be material. However, if changes in environmental regulations occur, such changes could impact several of our
facilities. As a result, from time to time, significant charges against income for environmental remediation may occur.
Under the terms of the Omnibus Agreement and in connection with the contribution of assets to us by affiliates of Sunoco,
Sunoco has agreed to indemnify us, in whole or in part, for 30 years from environmental and toxic tort liabilities related to the
assets contributed that arise from the operation of such assets prior to closing of the IPO. We have agreed to indemnify Sunoco
and its affiliates for events and conditions associated with the operation of the assets that occur on or after the closing of the IPO
and for environmental and toxic tort liabilities to the extent Sunoco is not required to indemnify us. See "Agreements with
Related Parties" for additional information.
In summary, total future costs for environmental remediation activities will depend upon, among other things, the
identification of any additional sites; the determination of the extent of the contamination at each site; the timing and nature of
required remedial actions; the technology available and needed to meet the various existing legal requirements; the nature and
terms of cost sharing arrangements with other potentially responsible parties; the nature and extent of future environmental laws;
inflation rates and the determination of our liability at the sites, if any, in light of the number, participation level and financial
viability of other parties.
New Accounting Pronouncements
For a discussion of any recently issued accounting pronouncements requiring adoption subsequent to December 31, 2014,
see Note 2 to the consolidated financial statements included in Item 8. "Financial Statements and Supplementary Data."
Agreements with Related Parties
Acquisition of Sunoco
The general and limited partner interests that were previously owned by Sunoco were contributed to ETP in connection
with the acquisition of Sunoco by ETP. As a result of these transactions, both SXL and Sunoco became consolidated subsidiaries
of ETP. We have various operating and administrative agreements with ETP and its affiliates, including the agreements described
below. ETP and its affiliates perform the administrative functions defined in such agreements on our behalf.
Service and Commodity Sales Agreements
We are party to various agreements with ETP and its affiliates to provide pipeline, terminalling and storage services. We
also have agreements for the purchase and sale of crude oil, refined products and NGLs. This activity is reflected in affiliated
revenues in the consolidated statements of comprehensive income.
We are party to the following commercial agreements with our affiliated entities:
• Product Terminal Services Agreement: We have a five-year product terminal services agreement with Sunoco under
which Sunoco may throughput refined products through our terminals. The agreement contains no minimum throughput
obligations for Sunoco. The agreement runs through February 2017.
• Fort Mifflin Terminal Services Agreement: We have an agreement with PES relating to the Fort Mifflin Terminal
Complex. Under this agreement, PES will deliver a minimum average of 300,000 bpd of crude oil and refined products
per contract year at the Fort Mifflin facility. PES does not have exclusive use of the Fort Mifflin Terminal Complex;
however, we are obligated to provide the necessary tanks, marine docks and pipelines for PES to meet its minimum
requirements under the agreement. We executed a 10-year agreement with PES in September 2012. We had a previous
agreement with Sunoco which included terms similar to those contained in the agreement with PES.
These agreements also provide PES with the option to purchase the Fort Mifflin and Belmont terminals if certain
triggering events occur, including a sale of substantially all of the assets or operations of the Philadelphia refinery, an
initial public offering, or a public debt filing of more than $200 million. The purchase price for each facility would be
established based on a fair value amount determined by designated third parties.
• Inter-Refinery Pipeline Lease: In September 2012, Sunoco assigned its lease for the use of our inter-refinery pipelines
between the Philadelphia and Marcus Hook refineries to PES. Under the 20-year lease agreement which expires in
February 2022, PES leases the inter-refinery pipelines for an annual fee which escalates at 1.67 percent each January 1
for the term of the agreement. The lease agreement also requires PES to reimburse us for any non-routine maintenance
expenditures, as defined, incurred during the term of the agreement. There were no material reimbursements under this
agreement during 2012 through 2014.