30-12-03 Petroleum refiner Sunoco completed an agreement to buy the Eagle Point refinery from Houston-based El Paso for $ 111 mm following receipt of Federal Trade Commission approval. The agreement also includes an option for Sunoco to purchase El Paso's share of the Harbour pipeline, which connects the refinery to regional distribution systems. In addition, Sunoco will pay at closing the fair market value of the refinery's crude-oil and refined product inventories.
An El Paso spokesman said the $ 111 mm purchase price doesn't include the option for the connecting pipeline assets. In April, the two companies signed a letter of intent for the transaction, which set a $ 130 mm price tag for the Westville, NJ, refinery and connecting pipelines, plus the fair market value for inventories at closing.

El Paso said the Eagle Point sale supports its plan to reduce its total debt to about $ 15 bn by the end of 2005 from $ 21 bn at Nov. 30. The plan, announced Dec. 15, includes an additional $ 3.3 bn to $ 3.9bn in asset sales, cost-cutting measures and a turnaround in its production business.
Sunoco said the acquisition of the Eagle Point refinery will expand its total refining capacity by 20 %, integrate well with its other northeast refining operations and make a significant contribution to 2004 results. The Eagle Point refinery, across the Delaware River from Sunoco's Philadelphia refining complex, has a rated capacity of 150,000 bpd, compared with Sunoco's refining capacity of 730,000 bpd.

Analysts expect Sunoco to earn $ 4.52 a share in 2004, compared with expected earnings of $ 4.55 a share for 2003, according to Thomson First Call. In 2002, Sunoco recorded a loss of $ 47 mm, or 62 cents a share, partially due to lower margins in its refining and supply and retail marketing businesses.
Sunoco plans to host a conference call upon final closing of the acquisition. Both El Paso and Sunoco said they now see closing the Eagle Point deal in mid-January. When they signed the letter of intent in April, the companies expected a closing in the second or third quarter of 2003.