Sunoco 2015 Annual Report Download - page 83
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81
6. Inventories
The components of inventories are as follows:
December 31,
2015 2014
(in millions)
Crude oil $ 424 $ 364
NGLs 83 90
Refined products 83 —
Refined products additives 3 4
Materials, supplies and other 14 12
Total Inventories $ 607 $ 470
In connection with the realignment of the Partnership's reporting segments, a new refined products inventory pool was
established during the fourth quarter 2015 which includes inventories such as gasoline and distillates. Previously, the volumes
of these products being marketed under refined products strategies was not material to the Partnership's financial position or
results of operations. The Partnership's investment in assets which facilitate the acquisition and marketing of refined products is
expected to increase its volumes sold under these strategies. This change in the Partnership's asset capabilities, combined with
the anticipated increase in volumes and significant pricing differentials between the refined products and NGLs commodities
that the Partnership markets, resulted in the establishment of refined products inventories in a separate inventory pool. This will
allow for better matching of revenues and expenses as these commodities are bought and sold. The inventory pool which was
previously disclosed as Refined Products and NGLs, has been renamed to NGLs and includes butane blending activities and the
acquisition and marketing of NGLs such as butane, propane and ethane.
In the fourth quarter 2014, the Partnership established LCM reserves of $231 and $27 million, respectively, on its crude
oil and NGLs inventories as a result of declining commodity prices. The LCM reserves totaled $381, $37 and $2 million at
December 31, 2015, on the Partnership's crude oil, NGLs and refined products inventories, respectively.
7. Properties, Plants and Equipment
The components of net properties, plants and equipment are as follows:
December 31,
Estimated
Useful Lives 2015 2014
(in years) (in millions)
Land and land improvements (including rights-of-way) (1) — $ 1,286 $ 1,212
Pipelines and related assets 16 - 39 5,943 4,253
Terminals and storage facilities 20 - 41 1,985 1,457
Buildings and improvements 25 - 32 509 245
Other 3 - 20 177 133
Construction-in-progress (2) 1,627 2,058
Total properties, plants and equipment 11,527 9,358
Less: Accumulated depreciation and amortization (835)(509)
Total properties, plants and equipment, net $ 10,692 $ 8,849
(1) As of December 31, 2015 and 2014, the Partnership had rights-of-way with a book value of $1.1 and $1.0 billion, respectively.
(2) As of December 31, 2015 and 2014, accrued capital expenditures were $286 and $283 million, respectively.