Philadelphia-based oil refiner Sunoco Inc. had a very good year. Growing 2005 revenues 32.4% to $33.7 billion, the company boasts 900,000 barrels per day of refining capacity, approximately 4,500 retail sites, over 4,800 miles of crude oil and refined product owned and operated pipelines and 38 product terminals.
But things change. The company reported net income of $79 million for the first quarter of 2006 versus $116 million for the first quarter of 2005.
"First-quarter earnings were impacted by a high level of refinery maintenance and rising crude oil prices during the quarter," said John G. Drosdick, Sunoco chairman and CEO, in a May 3, 2006, statement. "High beginning-of-the-year refined product inventories and unseasonably warm winter weather in the northeastern United States negatively impacted refining margins while rising crude oil prices squeezed retail gasoline and chemical margins during the quarter."
Drosdick also noted utilization at Sunoco's refining facilities was limited to 93% for the quarter due to maintenance ahead of this year's driving season.
"We will continue to invest significant capital in our refining facilities," said Drosdick.
"We have spent approximately $700 million to comply with the new low-sulfur gasoline and on-road diesel requirements. Looking ahead, over the next three years, we plan to spend approximately $2 billion to increase production and further improve and maintain our refining system."
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