
2.	ACQUISITIONS AND DISPOSITION

Pembroke Acquisition

On August 1, 2011, we acquired 100 percent of the outstanding shares of Chevron Limited from a subsidiary of Chevron Corporation (Chevron). Chevron Limited owns and operates the Pembroke Refinery, which has a total throughput capacity of approximately 270,000 barrels per day and is located in Wales, United Kingdom. Chevron Limited also owns, directly and through various subsidiaries, an extensive network of marketing and logistics assets throughout the United Kingdom and Ireland. On the closing date, we paid $1.8 billion from available cash, of which $1.1 billion was for working capital based on estimated amounts at closing that are subject to adjustment. This acquisition is referred to as the Pembroke Acquisition.

The Pembroke Acquisition is consistent with our general business strategy and broadens the geographic diversity of our refining and marketing network.

A determination of the acquisition-date fair values of the assets acquired and the liabilities assumed in the Pembroke Acquisition is pending the completion of an independent appraisal and other evaluations. Disclosure of pro forma information for the Pembroke Acquisition for the three and six months ended June 30, 2011 and 2010 is impracticable as historical financial information is not readily available at this time.

Acquisition of Pipeline and Terminal Facilities

In June 2011, we acquired two product terminal facilities in Louisville and Lexington, Kentucky and a minority interest in the LouLex Pipeline system, which connects the terminal facilities, from a subsidiary of Chevron for cash consideration of $37 million. These assets provide storage and distribution facilities for our wholesale marketing business in eastern Kentucky, which is supplied primarily by our Memphis Refinery.

Because this acquisition was not material to our results of operations, we have not presented actual results of operations for this acquisition from the acquisition date through June 30, 2011 or pro forma results of operations for the three and six months ended June 30, 2011 and 2010. The consolidated statements of income for the three and six months ended June 30, 2011 include the results of this acquisition from its acquisition date.

Disposition of Delaware City Refinery Assets and Associated Terminal and Pipeline Assets

In June 2010, we sold our shutdown Delaware City Refinery assets and associated terminal and pipeline assets to wholly owned subsidiaries of PBF Energy Partners LP (PBF) for $220 million of cash proceeds. The sale resulted in a gain of $92 million ($58 million after taxes) related to the shutdown refinery assets and a gain of $3 million related to the terminal and pipeline assets. The gain on the sale of the shutdown refinery assets resulted from the proceeds we received for the scrap value of the assets and the reversal of certain liabilities recorded in the fourth quarter of 2009 associated with the shutdown of the refinery, which we did not incur because of the sale, and it is presented in discontinued operations for the three and six months ended June 30, 2010.

Results of operations for the Delaware City Refinery prior to its sale, excluding the gain on the sale, are shown below (in millions):



	Three Months Ended June 30, 2010			Six Months Ended June 30, 2010
Operating revenues	$	—		$	—
Loss before income taxes	(7		)	(33		)

Acquisitions of Ethanol Plants

In December 2009, we signed an agreement with ASA Ethanol Holdings, LLC to buy two ethanol plants located in Linden, Indiana and Bloomingburg, Ohio and made a $20 million advance payment towards the acquisition of these plants. In January 2010, we completed the acquisition of these plants, including certain inventories, for total consideration of $202 million.

Also in December 2009, we received approval from a bankruptcy court to acquire an ethanol plant located near Jefferson, Wisconsin from Renew Energy LLC and made a $1 million advance payment towards the acquisition of this plant. We completed the acquisition of this plant, including certain receivables and inventories, in February 2010 for total consideration of $79 million.