Property, Plant, and Equipment

12 Months Ended

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

6. PROPERTY, PLANT, AND EQUIPMENT

Summary by Major Class

Major classes of property, plant, and equipment, including assets held under finance leases, consisted of the following (in millions):


	December 31,
	2023		2022
Land	$	505	$	499
Crude oil processing facilities	34,043		32,699
Transportation and terminaling facilities	5,978		5,900
Waste and renewable feedstocks processing facilities	3,243		3,215
Corn processing facilities	1,069		1,052
Administrative buildings	1,137		1,095
Finance lease ROU assets (see Note 5)	3,062		2,906
Other	1,942		1,886
Construction in progress	689		1,324
Property, plant, and equipment, at cost	51,668		50,576
Accumulated depreciation	(21,459)		(19,598)
Property, plant, and equipment, net	$	30,209	$	30,978

Depreciation expense for the years ended December 31, 2023, 2022, and 2021 was $1.9 billion, $1.7 billion, and $1.7 billion, respectively.

Asset Impairment

Our ethanol plant located in Lakota, Iowa (Lakota ethanol plant) was previously configured to produce a higher-grade ethanol product, as opposed to fuel-grade ethanol, suitable for hand sanitizer blending or industrial purposes that has a higher market value than fuel-grade ethanol. During 2022, demand for

higher-grade ethanol declined and had a negative impact on the profitability of the plant. As a result, we tested the recoverability of the carrying value of the Lakota ethanol plant and concluded that it was impaired. Therefore, we reduced the carrying value of the plant to its estimated fair value and recognized an asset impairment loss of $61 million for the year ended December 31, 2022. See Note 19 for disclosure related to the method used to determine fair value. During the third quarter of 2023, the Lakota ethanol plant resumed production of fuel-grade ethanol.

Sale of Ethanol Plant

In June 2022, we sold our ethanol plant in Jefferson, Wisconsin (Jefferson ethanol plant) for $32 million, which resulted in a gain of $23 million that is included in depreciation and amortization expense for the year ended December 31, 2022.

Change in Useful Life

The Jefferson ethanol plant was temporarily idled in 2020 at the onset of the COVID-19 pandemic in response to the decreased demand for ethanol resulting from the effects of the pandemic on our business, and we had previously evaluated this plant for potential impairment assuming that operations would resume. However, we completed an evaluation of the plant during the third quarter of 2021 and concluded that it was no longer a strategic asset for our ethanol business. The plant’s operations permanently ceased at that time and we reduced its estimated useful life, which reduced its net book value to estimated salvage value. The additional depreciation expense of $48 million for the year ended December 31, 2021 resulting from this change did not have a material impact on our results of operations nor was there a material impact to our financial position.