Valero Energy (VLO) 10-K 26 Feb 10 2009 FY Annual report Financial data

Document and Company Informatio

Document and Company Information (USD $)
In Billions, except Share data	12 Months Ended Dec. 31, 2009	Jan. 31, 2010	Jun. 30, 2009
Document and Company Information [Abstract]
Entity Registrant Name	VALERO ENERGY CORP/TX
Entity Central Index Key	0001035002
Document Type	10-K
Document Period End Date	2009-12-31
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			9.5
Entity Common Stock, Shares Outstanding (actual number)		564,808,668

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Millions	Dec. 31, 2009	Dec. 31, 2008
Current assets:
Cash and temporary cash investments	$825	$940
Restricted cash	122	131
Receivables, net	3,773	2,895
Inventories	4,863	4,620
Income taxes receivable	888	197
Deferred income taxes	180	98
Prepaid expenses and other	261	550
Assets related to discontinued operations	11	19
Total current assets	10,923	9,450
Property, plant and equipment, at cost	28,606	26,119
Accumulated depreciation	(5,594)	(4,698)
Property, plant and equipment, net	23,012	21,421
Intangible assets, net	227	224
Deferred charges and other assets, net	1,395	1,436
Long-term assets related to discontinued operations	72	1,886
Total assets	35,629	34,417
Current liabilities:
Current portion of debt and capital lease obligations	237	312
Accounts payable	5,760	4,323
Accrued expenses	514	370
Taxes other than income taxes	725	592
Income taxes payable	95	0
Deferred income taxes	253	485
Liabilities related to discontinued operations	214	127
Total current liabilities	7,798	6,209
Debt and capital lease obligations, less current portion	7,163	6,264
Deferred income taxes	4,063	3,829
Other long-term liabilities	1,869	2,158
Long-term liabilities related to discontinued operations	11	337
Stockholders' equity:
Common stock, $0.01 par value; 1,200,000,000 shares authorized; 673,501,593 and 627,501,593 shares issued	7	6
Additional paid-in capital	7,896	7,190
Treasury stock, at cost; 108,798,847 and 111,290,436 common shares	(6,721)	(6,884)
Retained earnings	13,178	15,484
Accumulated other comprehensive income (loss)	365	(176)
Total stockholders' equity	14,725	15,620
Total liabilities and stockholders' equity	$35,629	$34,417

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
	Dec. 31, 2009	Dec. 31, 2008
Stockholders' equity:
Common stock, par value	0.01	0.01
Common stock, shares authorized	1,200,000,000	1,200,000,000
Common stock, shares issued	673,501,593	627,501,593
Treasury stock, common shares	108,798,847	111,290,436

Consolidated Statements of Inco

Consolidated Statements of Income (USD $)
In Millions, except Per Share data	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Consolidated Statements of Income [Abstract]
Operating revenues (1)	$68,144	$113,136	$89,987
Costs and expenses:
Cost of sales	61,959	101,830	77,059
Operating expenses	3,311	4,046	3,666
Retail selling expenses	702	768	750
General and administrative expenses	572	559	638
Depreciation and amortization expense	1,428	1,363	1,244
Asset impairment loss	230	86	0
Gain on sale of Krotz Springs Refinery	0	(305)	0
Goodwill impairment loss	0	4,028	0
Total costs and expenses	68,202	112,375	83,357
Operating income (loss)	(58)	761	6,630
Other income, net	17	113	167
Interest and debt expense:
Incurred	(520)	(451)	(466)
Capitalized	112	104	105
Income (loss) from continuing operations before income tax expense (benefit)	(449)	527	6,436
Income tax expense (benefit)	(97)	1,539	2,059
Income (loss) from continuing operations	(352)	(1,012)	4,377
Income (loss) from discontinued operations, net of income taxes	(1,630)	(119)	857
Net income (loss)	(1,982)	(1,131)	5,234
Earnings (loss) per common share:
Continuing operations	-0.65	-1.93	7.73
Discontinued operations	-3.02	-0.23	1.51
Total	-3.67	-2.16	9.24
Weighted-average common shares outstanding (in millions)	541	524	565
Earnings (loss) per common share - assuming dilution:
Continuing operations	-0.65	-1.93	7.4
Discontinued operations	-3.02	-0.23	1.48
Total	-3.67	-2.16	8.88
Weighted-average common shares outstanding - assuming dilution (in millions)	541	524	579
Dividends per common share	0.6	0.57	0.48
Supplemental information:
(1) Includes excise taxes on sales by our U.S. retail system	$873	$816	$801

Consolidated Statements of Stoc

Consolidated Statements of Stockholders' Equity (USD $)
In Millions	Common Stock	Additional Paid-in Capital	Treasury Stock	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Total
Beginning Balance at Dec. 31, 2006	$6	$7,779	($1,396)	$11,951	$265
Net income (loss)				5,234		5,234
Dividends on common stock				(271)
Stock-based compensation expense		89
Shares repurchased under $6 billion common stock purchase program			(4,873)
Shares issued, net of shares repurchased, in connection with employee stock plans and other		(757)	172
Other comprehensive income (loss)					308	308
Ending Balance at Dec. 31, 2007	6	7,111	(6,097)	16,914	573
Net income (loss)				(1,131)		(1,131)
Dividends on common stock				(299)
Stock-based compensation expense		62
Shares repurchased under $6 billion common stock purchase program			(667)
Shares repurchased, net of shares issued, in connection with employee stock plans and other		17	(120)
Other comprehensive income (loss)					(749)	(749)
Ending Balance at Dec. 31, 2008	6	7,190	(6,884)	15,484	(176)	15,620
Net income (loss)				(1,982)		(1,982)
Dividends on common stock				(324)
Sale of common stock	1	798
Stock-based compensation expense		68
Shares issued, net of shares repurchased, in connection with employee stock plans and other		(160)	163
Other comprehensive income (loss)					541	541
Ending Balance at Dec. 31, 2009	$7	$7,896	($6,721)	$13,178	$365	$14,725

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Cash flows from operating activities:
Net income (loss)	($1,982)	($1,131)	$5,234
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization expense	1,527	1,476	1,376
Asset impairment loss	607	103	0
Goodwill impairment loss	0	4,069	0
Gain on sale of Krotz Springs Refinery and Lima Refinery	0	(305)	(827)
Loss on shutdown of Delaware City Refinery	1,868	0	0
Noncash interest expense and other income, net	(2)	(76)	(10)
Stock-based compensation expense	66	59	100
Deferred income tax expense (benefit)	(343)	675	(131)
Changes in current assets and current liabilities	255	(1,630)	(469)
Changes in deferred charges and credits and other operating activities, net	(173)	(145)	(15)
Net cash provided by operating activities	1,823	3,095	5,258
Cash flows from investing activities:
Capital expenditures	(2,306)	(2,893)	(2,260)
Deferred turnaround and catalyst costs	(415)	(408)	(518)
Purchase of certain VeraSun Energy Corporation facilities	(556)	0	0
Advance payments related to purchase of ethanol facilities	(21)	0	0
Proceeds from sale of Krotz Springs Refinery	0	463	0
Proceeds from sale of Lima Refinery	0	0	2,428
Contingent payments in connection with acquisitions	0	(25)	(75)
(Investment) return of investment in Cameron Highway Oil Pipeline Company, net	27	24	(209)
Proceeds from minor dispositions of property, plant and equipment	16	25	63
Minor acquisitions	(29)	(144)	0
Other investing activities, net	(8)	(7)	(11)
Net cash used in investing activities	(3,292)	(2,965)	(582)
Cash flows from financing activities:
Proceeds from the sale of common stock, net of issuance costs	799	0	0
Non-bank debt:
Borrowings	998	0	2,245
Repayments	(285)	(374)	(463)
Bank credit agreements:
Borrowings	39	296	3,000
Repayments	(39)	(296)	(3,000)
Accounts receivable sales program:
Proceeds from sale of receivables	950	0	0
Repayments	(850)	0	0
Purchase of common stock for treasury	(4)	(955)	(5,788)
Issuance of common stock in connection with employee benefit plans	11	16	159
Benefit from tax deduction in excess of recognized stock-based compensation cost	5	9	311
Common stock dividends	(324)	(299)	(271)
Other financing activities	(11)	(4)	(24)
Net cash provided by (used in) financing activities	1,289	(1,607)	(3,831)
Effect of foreign exchange rate changes on cash	65	(47)	29
Net increase (decrease) in cash and temporary cash investments	(115)	(1,524)	874
Cash and temporary cash investments at beginning of year	940	2,464	1,590
Cash and temporary cash investments at end of year	$825	$940	$2,464

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Consolidated Statements of Comprehensive Income [Abstract]
Net income (loss)	($1,982)	($1,131)	$5,234
Other comprehensive income (loss):
Foreign currency translation adjustment, net of income tax expense of $-, $-, and $31	375	(490)	250
Pension and other postretirement benefits:
Net gain (loss) arising during the year, net of income tax (expense) benefit of $(132), $227, and $(56)	219	(410)	80
Net (gain) loss reclassified into income, net of income tax expense (benefit) of $(2), $-, and $(3)	(1)	(1)	6
Net gain (loss) on pension and other postretirement benefits	218	(411)	86
Net gain (loss) on derivative instruments designated and qualifying as cash flow hedges:
Net gain (loss) arising during the year, net of income tax (expense) benefit of $(44), $(46), and $6	81	85	(11)
Net (gain) loss reclassified into income, net of income tax expense (benefit) of $72, $(36), and $9	(133)	67	(17)
Net gain (loss) on cash flow hedges	(52)	152	(28)
Other comprehensive income (loss)	541	(749)	308
Comprehensive income (loss)	($1,441)	($1,880)	$5,542

1_Consolidated Statements of Co

Consolidated Statements of Comprehensive Income (Parenthetical) (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Other comprehensive income (loss):
Foreign currency translation adjustment, income tax expense	$0	$0	$31
Pension and other postretirement benefits:
Net gain (loss) arising during the year, income tax (expense) benefit	(132)	227	(56)
Net (gain) loss reclassified into income, income tax expense (benefit)	(2)	0	(3)
Net gain (loss) on derivative instruments designated and qualifying as cash flow hedges:
Net gain (loss) arising during the year, income tax (expense) benefit	(44)	(46)	6
Net (gain) loss reclassified into income, income tax expense (benefit)	$72	($36)	$9

Summary of Significant Accounti

Summary of Significant Accounting Policies
	12 Months Ended Dec. 31, 2009 USD / shares
Summary of Significant Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation As used in this report, the terms Valero, we, us, or our may refer to Valero Energy Corporation, one or more of its consolidated subsidiaries, or all of them taken as a whole. We are an independent petroleum refining and marketing company and own 15 refineries with a combined total throughput capacity as of December31, 2009 of approximately 2.8million barrels per day. We market our refined products through an extensive bulk and rack marketing network and approximately 5,800 retail and wholesale branded outlets in the United States and eastern Canada under various brand names including Valero, Diamond Shamrock, Shamrock, Ultramar, and Beacon. We also produce ethanol, and as of December31, 2009, we operated seven ethanol plants in the Midwest with a combined capacity of approximately 780million gallons per year. Our operations are affected by: company-specific factors, primarily refinery utilization rates and refinery maintenance turnarounds; seasonal factors, such as the demand for refined products during the summer driving season and heating oil during the winter season; and industry factors, such as movements in and the level of crude oil prices including the effect of quality differential between grades of crude oil, the demand for and prices of refined products, industry supply capacity, and competitor refinery maintenance turnarounds. These consolidated financial statements include the accounts of Valero and subsidiaries in which Valero has a controlling interest. Intercompany balances and transactions have been eliminated in consolidation. Investments in significant noncontrolled entities are accounted for using the equity method. As discussed in Note 2, we permanently shut down our Delaware City Refinery in the fourth quarter of 2009. As a result, the results of operations of the Delaware City Refinery have been presented as discontinued operations in the consolidated statements of income for all periods presented. Also see Note 2 for a discussion of the presentation in the consolidated statements of income of the results of operations of the Krotz Springs Refinery and the Lima Refinery, which were sold effective July1, 2008 and July1, 2007, respectively. The term UDS Acquisition refers to the merger of Ultramar Diamond Shamrock Corporation (UDS)into Valero effective December31, 2001. The term Premcor Acquisition refers to the merger of Premcor Inc. (Premcor) into Valero effective September1, 2005. We have evaluated subsequent events that occurred after December31, 2009 through the filing of this Form 10-K. Any material subsequent events that occurred during this time have been properly recognized or disclosed in our financial statements. Financial Accounting Standards Board (FASB) Accounting Standards Codification (the Codification or ASC) The Codification is the single source of authoritative generally accepted accounting principles (GAAP)recognized by the FASB, to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP

Acquisitions Dispositions and P

Acquisitions Dispositions and Permanent Plant Closure
	12 Months Ended Dec. 31, 2009 USD / shares
Acquisitions Dispositions and Permanent Plant Closure [Abstract]
ACQUISITIONS, DISPOSITIONS AND PERMANENT PLANT CLOSURE	2. ACQUISITIONS, DISPOSITIONS, AND PERMANENT PLANT CLOSURE Shutdown of Delaware City Refinery On November20, 2009, we announced the permanent shutdown of our Delaware City Refinery due to financial losses caused by poor economic conditions, significant capital spending requirements, and high operating costs. In the fourth quarter of 2009, we recorded a pre-tax loss of $1.9billion, of which $1.4billion represented the write-down of the book value of the refinery assets to net realizable value (see discussion in Note 3 below). The remaining loss was comprised primarily of $132million related to the recognition of previously deferred losses on cash flow hedges that were discontinued due to the shutdown (see Note 18), $95million of asset retirement obligations, $81million of cancelled capital projects, $56million of contract cancellation costs, and $47million of employee termination costs. In addition to the loss resulting from the permanent shutdown of our Delaware City Refinery, the results of operations of the Delaware City Refinery for 2009 also included $377million of other pre-tax asset impairment losses, including both operating assets and projects in progress as further discussed in Note 3, and $393million of pre-tax losses from operations. During 2008, the Delaware City Refinery incurred a pre-tax loss of $190million, comprised of $132million of operating losses, $41million of goodwill impairment loss, and $17million of asset impairment losses. The consolidated statements of income reflect the operations related to the Delaware City Refinery in income (loss)from discontinued operations, net of income taxes for all periods presented. The remaining carrying amount of the Delaware City Refinery assets as of December31, 2009 is immaterial. Financial information related to the assets, liabilities, and operations of the Delaware City Refinery is summarized as follows (in millions). December 31, 2009 2008 Current assets related to discontinued operations: Receivables, net $ 6 $ 2 Inventories 4 17 Prepaid expenses and other 1 Total current assets related to discontinued operations $ 11 $ 19 Long-term assets related to discontinued operations: Property, plant and equipment, net $ 15 $ 1,792 Deferred charges and other assets, net 94 Deferred income taxes 57 Total long-term assets related to discontinued operations $ 72 $ 1,886 Current liabilities related to discontinued operations: Accounts payable $ 90 $ 123 Accrued expenses 124 4 Total current liabilities related to discontinued operations $ 214 $ 127 Long-term liabilities related to discontinued operations: Deferred income taxes $ $ 334 Other long-term liabilities 11 3 Total long-term liabilities related to discontinued operations $ 11 $ 337

Impairments

Impairments
	12 Months Ended Dec. 31, 2009 USD / shares
Impairments [Abstract]
IMPAIRMENTS	3. IMPAIRMENTS Goodwill Impairment As shown in Note 9, as of December31, 2007, we had goodwill with a balance of $4.0billion. All of our goodwill was allocated among four reporting units that comprise the refining segment. These reporting units are the Gulf Coast, Mid-Continent, Northeast, and West Coast refining regions. Our annual test for impairment of goodwill was historically performed as of October 1 of each year. However, during the fourth quarter of 2008, there were severe disruptions in the capital and commodities markets that contributed to a significant decline in our common stock price. As a result, our equity market capitalization fell significantly below our net book value. Because this situation is an indicator that goodwill may be impaired, we performed an additional analysis to evaluate the potential impairment of our goodwill as of December31, 2008. Based on this additional analysis, we determined that all of the goodwill in our four reporting units was impaired, which resulted in the recognition of a goodwill impairment loss of $4.1billion ($4.0billion after tax), of which $41million ($40million after tax) was attributed to the Delaware City Refinery and therefore reclassified to discontinued operations. For purposes of this goodwill impairment test, the fair value of each reporting unit was estimated based on the present value of expected future cash flows, with the present value determined using discount rates that reflected the risk inherent in the assets and risk premiums that reflected the volatility in the industry and the financial markets. Impairment of Property, Plant and Equipment, Excluding Capital Projects Due to the adverse changes in market conditions during 2008 discussed under Goodwill Impairment above, we also evaluated our significant operating assets for potential impairment as of December31, 2008, and we determined that the carrying amount of each of these assets was recoverable. However, the economic slowdown that began in 2008 continued throughout 2009, thereby impacting demand for refined products and putting significant pressure on refined product margins. Due to these economic conditions, in June2009, we announced our plan to shut down the Aruba Refinery temporarily as narrow heavy sour crude oil differentials made the refinery uneconomical to operate. The Aruba Refinery was shut down in July2009 and is expected to continue to be shut down until market conditions improve. We are continuing to evaluate potential alternatives for this refinery, which may include the sale of the refinery. In addition, we have negotiated a settlement of various tax disputes with the Government of Aruba (GOA), which will be presented to the Aruban Parliament for approval and implementation. The outcome of this agreement could have a significant impact on the future economics of this refinery (see Note 23). As of December31, 2009, the Aruba Refinery had a net book value of approximately $1.0billion. In September2009, we announced the shutdown of our coker and gasification units at our Delaware City Refinery also due to economic reasons. The coker unit was expected to remain shut down until economic

Restricted Cash

Restricted Cash
	12 Months Ended Dec. 31, 2009 USD / shares
Restricted Cash [Abstract]
RESTRICTED CASH	4. RESTRICTED CASH Restricted cash consisted of the following (in millions): December 31, 2009 2008 Cash held in trust related to the UDS Acquisition $ $ 22 Cash held in trust related to the Premcor Acquisition 7 7 Cash related to escrow agreement with the Government of Aruba (see Note 23) 115 102 Restricted cash $ 122 $ 131 The cash held in trust related to the UDS Acquisition as of December31, 2008 was released during 2009 due to the expiration of the statute of limitations for certain payments for which the cash had been restricted.

Receivables

Receivables
	12 Months Ended Dec. 31, 2009 USD / shares
Receivables [Abstract]
RECEIVABLES	5. RECEIVABLES Receivables consisted of the following (in millions): December 31, 2009 2008 Accounts receivable $ 3,800 $ 2,937 Notes receivable and other 18 16 3,818 2,953 Allowance for doubtful accounts (45 ) (58 ) Receivables, net $ 3,773 $ 2,895 The changes in the allowance for doubtful accounts consisted of the following (in millions): Year Ended December 31, 2009 2008 2007 Balance as of beginning of year $ 58 $ 43 $ 33 Increase in allowance charged to expense 28 43 34 Accounts charged against the allowance, net of recoveries (42 ) (27 ) (25 ) Foreign currency translation 1 (1 ) 1 Balance as of end of year $ 45 $ 58 $ 43

Inventories

Inventories
	12 Months Ended Dec. 31, 2009 USD / shares
Inventories [Abstract]
INVENTORIES	6. INVENTORIES Inventories consisted of the following (in millions): December 31, 2009 2008 Refinery feedstocks $ 2,124 $ 2,140 Refined products and blendstocks 2,317 2,224 Ethanol feedstocks and products 141 Convenience store merchandise 96 90 Materials and supplies 185 166 Inventories $ 4,863 $ 4,620 Refinery feedstock and refined product and blendstock inventory volumes totaled 113million barrels and 114million barrels as of December31, 2009 and 2008, respectively. In addition, the ethanol segment inventories comprised 9million bushels of corn, 48million gallons of ethanol, and 69,000 tons of distillers grains as of December31, 2009. Overall during 2009, we had a net liquidation of LIFO inventory layers that were established in prior years, the effect of which was to increase cost of sales by $66million. There were no substantial liquidations of LIFO inventory layers for the years ended December31, 2008 and 2007. As of December31, 2009 and 2008, the replacement cost (market value) of LIFO inventories exceeded their LIFO carrying amounts by approximately $4.5billion and $686million, respectively.

Property, Plant and Equipment

Property, Plant and Equipment
	12 Months Ended Dec. 31, 2009 USD / shares
Property, Plant and Equipment [Abstract]
PROPERTY, PLANT AND EQUIPMENT	7. PROPERTY, PLANT AND EQUIPMENT Major classes of property, plant and equipment, which include capital lease assets, consisted of the following (in millions): Estimated December 31, Useful Lives 2009 2008 Land $ 646 $ 602 Crude oil processing facilities 10 - 33 years 20,819 19,333 Butane processing facilities 30 years 246 246 Pipeline and terminal facilities 24 - 44 years 668 549 Grain processing equipment 22 years 399 Retail facilities 5 - 22 years 851 787 Buildings 13 - 47 years 1,013 872 Other 2 - 44 years 1,208 1,098 Construction in progress 2,756 2,632 Property, plant and equipment, at cost 28,606 26,119 Accumulated depreciation (5,594 ) (4,698 ) Property, plant and equipment, net $ 23,012 $ 21,421 We had crude oil processing facilities, pipeline and terminal facilities, and certain buildings and other equipment under capital leases totaling $55million and $54million as of December31, 2009 and 2008, respectively. Accumulated amortization on assets under capital leases was $17million and $13million, respectively, as of December31, 2009 and 2008. Depreciation expense related to continuing operations for the years ended December31, 2009, 2008, and 2007 was $973million, $921million, and $848million, respectively.

Intangible Assets

Intangible Assets
	12 Months Ended Dec. 31, 2009 USD / shares
Intangible Assets [Abstract]
INTANGIBLE ASSETS	8. INTANGIBLE ASSETS Intangible assets consisted of the following (in millions): December 31, 2009 December 31, 2008 Gross Accumulated Gross Accumulated Cost Amortization Cost Amortization Intangible assets subject to amortization: Customer lists $ 114 $ (57 ) $ 97 $ (43 ) Canadian retail operations 147 (30 ) 127 (22 ) U.S. retail store operations 78 (64 ) 95 (76 ) Air emission credits 62 (34 ) 62 (29 ) Royalties and licenses 25 (14 ) 25 (12 ) Gasoline and diesel sulfur credits 27 (27 ) Other 4 (4 ) Intangible assets subject to amortization $ 426 $ (199 ) $ 437 $ (213 ) All of our intangible assets are subject to amortization. Amortization expense for intangible assets was $25million, $33million, and $48million for the years ended December31, 2009, 2008, and 2007, respectively. The estimated aggregate amortization expense for the years ending December31, 2010 through December31, 2014 is as follows (in millions): Amortization Expense 2010 $ 22 2011 16 2012 16 2013 16 2014 16 During the year ended December31, 2009, both gross cost and accumulated amortization decreased by $50million due to the retirement of certain intangible assets, and gross cost and accumulated amortization of intangible assets increased by $35million and $11million, respectively, due to fluctuations in the Canadian dollar exchange rate.

Goodwill

Goodwill
	12 Months Ended Dec. 31, 2009 USD / shares
Goodwill [Abstract]
GOODWILL	9. GOODWILL The changes in the carrying amount of goodwill for the year ended December31, 2008 were as follows (in millions): Balance as of December31, 2007 $ 4,019 Settlements and adjustments related to acquisition tax contingencies, stock option exercises, and other 50 Goodwill impairment loss (4,069 ) Balance as of December31, 2008 $ Settlements and adjustments related to acquisition tax contingencies, stock option exercises, and other reflected in the table above relate primarily to settlements and adjustments of various income tax contingencies assumed in the UDS and Premcor Acquisitions and exercises of stock options assumed in those acquisitions, the effects of which were recorded as purchase price adjustments. See Note 3 for a discussion of the goodwill impairment loss recognized in 2008.

Deferred Charges and Other Asse

Deferred Charges and Other Assets
	12 Months Ended Dec. 31, 2009 USD / shares
Deferred Charges and Other Assets [Abstract]
DEFERRED CHARGES AND OTHER ASSETS	10. DEFERRED CHARGES AND OTHER ASSETS Deferred charges and other assets, net includes refinery turnaround and catalyst costs, which are deferred and amortized as discussed in Note 1. Amortization expense related to continuing operations for deferred refinery turnaround and catalyst costs was $417million, $394million, and $336million for the years ended December31, 2009, 2008, and 2007, respectively. Cameron Highway Oil Pipeline Project We own a 50% interest in Cameron Highway Oil Pipeline Company, a general partnership formed to construct and operate a crude oil pipeline. The 390-mile crude oil pipeline delivers up to 500,000 barrels per day from the Gulf of Mexico to the major refining areas of Port Arthur and Texas City, Texas. Our investment in Cameron Highway Oil Pipeline Company is accounted for using the equity method and is included in deferred charges and other assets, net in the consolidated balance sheets. During May and June of 2007, we made cash capital contributions of $215million representing our 50% portion of the amount required to enable the joint venture to redeem its fixed-rate notes and variable-rate debt. As of December31, 2009 and 2008, our investment in Cameron Highway Oil Pipeline Company totaled $281million and $289million, respectively.

Accrued Expenses

Accrued Expenses
	12 Months Ended Dec. 31, 2009 USD / shares
Accrued Expenses [Abstract]
ACCRUED EXPENSES	11. ACCRUED EXPENSES Accrued expenses consisted of the following (in millions): December 31, 2009 2008 Employee wage and benefit costs $ 156 $ 165 Interest expense 100 66 Derivative liabilities 109 7 Environmental liabilities 41 42 Other 108 90 Accrued expenses $ 514 $ 370

Debt and Capital Lease Obligati

Debt and Capital Lease Obligations
	12 Months Ended Dec. 31, 2009 USD / shares
Debt and Capital Lease Obligations [Abstract]
DEBT AND CAPITAL LEASE OBLIGATIONS	12. DEBT AND CAPITAL LEASE OBLIGATIONS Debt balances, at stated values, and capital lease obligations consisted of the following (in millions): December 31, Maturity 2009 2008 Bank credit facilities Various $ $ Industrial revenue bonds: Tax-exempt Revenue Refunding Bonds (a): Series1997A, 5.45% 2027 24 24 Series1997B, 5.40% 2018 33 33 Series1997C, 5.40% 2018 33 33 Series1997D, 5.125% 2009 9 Tax-exempt Waste Disposal Revenue Bonds: Series1997, 5.6% 2031 25 25 Series1998, 5.6% 2032 25 25 Series1999, 5.7% 2032 25 25 Series2001, 6.65% 2032 19 19 3.50% notes 2009 200 4.75% notes 2013 300 300 4.75% notes 2014 200 200 6.125% notes 2017 750 750 6.625% notes 2037 1,500 1,500 6.875% notes 2012 750 750 7.50% notes 2032 750 750 8.75% notes 2030 200 200 Debentures: 7.25% 2010 25 25 7.65% 2026 100 100 8.75% 2015 75 75 Senior Notes: 6.125% 2011 200 200 6.70% 2013 180 180 6.75% 2011 210 210 6.75% 2014 185 185 6.75% 2037 24 100 7.20% 2017 200 200 7.45% 2097 100 100 7.50% 2015 287 287 9.375% 2019 750 10.50% 2039 250 Other debt 2010 200 100 Net unamortized discount, including fair value adjustments (56 ) (68 ) Total debt 7,364 6,537 Capital lease obligations, including unamortized fair value adjustments of $3 and $3 36 39 Total debt and capital lease obligations 7,400 6,576 Less current portion (237 ) (312 ) Debt and capital lease obligations, less current portion $ 7,163 $ 6,264 (a) The maturity dates reflected for the Series1997A, 1997B, and 1997C tax-exempt revenue refunding bonds represent their final maturity dates; however, principal payments on these bonds commence in 2010. Bank Credit Facilities We have a revolving credit facility (the Revolver) that has a maturity date of November2012. As of December31, 2008, the Revolver had a borrowing capacity of $2.5billion. In October2009, Aurora Bank FSB (Aurora, formerly Lehman Brothers Bank, FSB), one of the participating banks under the Revolver, failed to fund its loan commitment related to our borrowing under this facility. Auroras aggregate commitment under the Revolver was $84million. As a result, our borrowing capacity under the Revolver has been effectively reduced to $2.4billion. Borrowings under the Revolver bear interest at LIBOR plus a margin, or an a

Other Long-Term Liabilities

Other Long-Term Liabilities
	12 Months Ended Dec. 31, 2009 USD / shares
Other Long-Term Liabilities [Abstract]
OTHER LONG-TERM LIABILITIES	13. OTHER LONG-TERM LIABILITIES Other long-term liabilities consisted of the following (in millions): December 31, 2009 2008 Employee benefit plan liabilities $ 703 $ 1,036 Tax liabilities for uncertain income tax positions 481 226 Environmental liabilities 238 255 Other tax liabilities 103 189 Insurance liabilities 84 90 Asset retirement obligations 76 72 Deferred gain on sale of assets to NuStar Energy L.P. 70 92 Unfavorable lease obligations 32 38 Other 82 160 Other long-term liabilities $ 1,869 $ 2,158 Employee benefit plan liabilities include the long-term obligation for our pension and other postretirement benefit plans as discussed in Note 21 as well as certain other employee benefit obligations. Tax liabilities for uncertain income tax positions are discussed in Note 19. Environmental liabilities reflect the long-term portion of our estimated remediation costs for environmental matters as discussed in Note 24. Other tax liabilities include long-term liabilities for various taxes such as sales, franchise, and excise taxes as well as interest accrued on all tax-related liabilities, including income taxes. Insurance liabilities reflect reserves established by our captive insurance subsidiary, self-insured liabilities, and obligations for losses related to our participation in certain mutual insurance companies. Deferred gain reflects the unamortized balance of the proceeds in excess of the carrying amount of assets we sold to NuStar Energy L.P., which we recognize in income over the term of certain throughput and handling agreements with NuStar Energy L.P. Unfavorable lease obligations reflect the fair value of liabilities assumed in connection with the Premcor Acquisition related to lease agreements for closed retail facilities and the UDS Acquisition related to lease agreements for retail facilities and vessel charters. Included in other are liabilities for various matters including legal and regulatory liabilities and various contractual obligations. The table below reflects the changes in our asset retirement obligations (in millions). See Note 1 under Asset Retirement Obligations for a discussion of the liability related to these obligations. Asset retirement obligations related to our shutdown Delaware City Refinery are included in current and long-term liabilities related to discontinued operations in our consolidated balance sheets. Year Ended December 31, 2009 2008 2007 Balance as of beginning of year $ 72 $ 70 $ 51 Additions to accrual 4 4 1 Accretion expense 3 3 2 Settlements (3 ) (4 ) (13 ) Changes in timing and amount of estimated cash flows 28 Foreign currency translation (1 ) 1 Balance as of end of year $ 76 $ 72 $ 70

Stockholders' Equity

Stockholders' Equity
	1/1/2009 - 12/31/2009 USD / shares
Stockholders' Equity [Abstract]
STOCKHOLDERS' EQUITY	14. STOCKHOLDERS EQUITY Share Activity For the years ended December31, 2009, 2008, and 2007, activity in the number of shares of common stock and treasury stock was as follows (in millions): Common Treasury Stock Stock Balance as of December31, 2006 627 (24 ) Shares repurchased under $6billion common stock purchase program (70 ) Shares issued, net of shares repurchased, in connection with employee stock plans and other 3 Balance as of December31, 2007 627 (91 ) Shares repurchased under $6billion common stock purchase program (18 ) Shares repurchased, net of shares issued, in connection with employee stock plans and other (2 ) Balance as of December31, 2008 627 (111 ) Sale of common stock 46 Shares issued, net of shares repurchased, in connection with employee stock plans and other 2 Balance as of December31, 2009 673 (109 ) Common Stock Offering On June3, 2009, we sold in a public offering 46million shares of our common stock, which included 6million shares related to an overallotment option exercised by the underwriters, at a price of $18.00 per share and received proceeds, net of underwriting discounts and commissions and other issuance costs, of $799million. Preferred Stock We have 20million shares of preferred stock authorized with a par value of $.01 per share. No shares of preferred stock were outstanding during the years ended December31, 2009, 2008, and 2007. Treasury Stock We purchase shares of our common stock in open market transactions to meet our obligations under employee benefit plans. We also purchase shares of our common stock from our employees and non-employee directors in connection with the exercise of stock options, the vesting of restricted stock, and other stock compensation transactions. On April25, 2007, our board of directors approved an amendment to our pre-existing $2billion common stock purchase program to increase the authorized purchases under the program to $6billion. Stock purchases under the program are made from time to time at prevailing prices as permitted by securities laws and other legal requirements, and are subject to market conditions and other factors. The program does not have a scheduled expiration date. In conjunction with the increase in our common stock purchase program, we entered into an agreement with a financial institution to purchase $3billion of our shares under an accelerated share repurchase program, and in late April2007, 42.1million shares were purchased under this agreement. As described in Note 12 above, the purchase of these shares was initially funded with a 364-day term credit agreement, which we subsequently replaced with longer-term financing. The cost of the shares purchased under this accelerated share repurchase program was to be adjusted at the expiration of the program, with the final purchase cost based on a discount to the average trading price of our common stock, weighted by the daily volume of s

Earnings

Earnings (Loss) Per Share
	12 Months Ended Dec. 31, 2009 USD / shares
Earnings (Loss) Per Share [Abstract]
EARNINGS (LOSS) PER SHARE	15. EARNINGS (LOSS)PER SHARE Earnings (loss)per common share amounts from continuing operations were computed as follows (dollars and shares in millions, except per share amounts): Year Ended December 31, 2009 2008 2007 Restricted Common Restricted Common Restricted Common Stock Stock Stock Stock Stock Stock Earnings (loss)per common share from continuing operations: Income (loss)from continuing operations $ (352 ) $ (1,012 ) $ 4,377 Less dividends paid: Common stock 323 298 270 Nonvested restricted stock 1 1 1 Undistributed earnings (loss) $ (676 ) $ (1,311 ) $ 4,106 Weighted-average common shares outstanding 2 541 1 524 1 565 Earnings (loss)per common share from continuing operations: Distributed earnings $ 0.61 $ 0.60 $ 0.56 $ 0.57 $ 0.47 $ 0.48 Undistributed earnings (loss) (1.25 ) (2.50 ) 7.25 7.25 Total earnings (loss)per common share from continuing operations (1) $ 0.61 $ (0.65 ) $ 0.56 $ (1.93 ) $ 7.72 $ 7.73 Earnings (loss)per common share from continuing operations assuming dilution: Income (loss)from continuing operations $ (352 ) $ (1,012 ) $ 4,377 Less: Cash paid in final settlement of accelerated share repurchase program 94 Income (loss)from continuing operations assuming dilution $ (352 ) $ (1,012 ) $ 4,283 Weighted-average common shares outstanding 541 524 565 Common equivalent shares (2): Stock options 13 Restricted stock and other 1 Weighted-average common shares outstanding assuming dilution 541 524 579 Earnings (loss)per common share from continuing operations - assuming dilution $ (0.65 ) $ (1.93 ) $ 7.40 (1) In addition to the change in earnings (loss)per common share from continuing operations resulting from the reclassification of the results of operations of the Delaware City

Supplemental Cash Flow Informat

Supplemental Cash Flow Information
	12 Months Ended Dec. 31, 2009 USD / shares
Supplemental Cash Flow Information [Abstract]
SUPPLEMENTAL CASH FLOW INFORMATION	16. SUPPLEMENTAL CASH FLOW INFORMATION In order to determine net cash provided by operating activities, net income (loss)is adjusted by, among other things, changes in current assets and current liabilities as follows (in millions): Year Ended December 31, 2009 2008 2007 Decrease (increase)in current assets: Restricted cash $ 9 $ (100 ) $ Receivables, net (806 ) 4,865 (3,227 ) Inventories (77 ) (705 ) (249 ) Income taxes receivable (668 ) (197 ) 32 Prepaid expenses and other 47 (7 ) (58 ) Increase (decrease)in current liabilities: Accounts payable 1,475 (4,985 ) 2,557 Accrued expenses 73 (51 ) (20 ) Taxes other than income taxes 107 (4 ) 15 Income taxes payable 95 (446 ) 481 Changes in current assets and current liabilities $ 255 $ (1,630 ) $ (469 ) The above changes in current assets and current liabilities differ from changes between amounts reflected in the applicable consolidated balance sheets for the respective periods for the following reasons: the amounts shown above exclude changes in cash and temporary cash investments, deferred income taxes, and current portion of debt and capital lease obligations, as well as the effect of certain noncash investing and financing activities discussed below; the amounts shown above exclude the current assets and current liabilities acquired in connection with the VeraSun Acquisition; amounts accrued for capital expenditures, deferred turnaround and catalyst costs, and contingent earn-out payments are reflected in investing activities in the consolidated statements of cash flows when such amounts are paid; amounts accrued for common stock purchases in the open market that are not settled as of the balance sheet date are reflected in financing activities in the consolidated statements of cash flows when the purchases are settled and paid; changes in assets and liabilities related to the discontinued operations of the Delaware City Refinery prior to its shutdown are reflected in the line items to which the changes relate in the table above; changes in assets held for sale and liabilities related to assets held for sale pertaining to the operations of the Krotz Springs Refinery and the Lima Refinery prior to their sales are reflected in the line items to which the changes relate in the table above; and certain differences between consolidated balance sheet changes and consolidated statement of cash flow changes reflected above result from translating foreign currency denominated amounts at different exchange rates. There were no significant noncash investing or financing activities for the year ended December31, 2009. Noncash investing activities for the year ended December31, 2008 included the contingent consideration received in the form of the earn-out agreement related t

Fair Value Measurements

Fair Value Measurements
	12 Months Ended Dec. 31, 2009 USD / shares
Fair Value Measurements [Abstract]
FAIR VALUE MEASUREMENTS	17. FAIR VALUE MEASUREMENTS A fair value hierarchy (Level 1, Level 2, or Level 3) is used to categorize fair value amounts based on the quality of inputs used to measure fair value. Accordingly, fair values determined by Level 1 inputs utilize quoted prices in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs are based on quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. We use appropriate valuation techniques based on the available inputs to measure the fair values of our applicable assets and liabilities. When available, we measure fair value using Level 1 inputs because they generally provide the most reliable evidence of fair value. The tables below present information (dollars in millions) about our financial assets and liabilities measured and recorded at fair value on a recurring basis and indicate the fair value hierarchy of the inputs utilized by us to determine the fair values as of December31, 2009 and 2008. Fair Value Measurements Using Quoted Significant Prices Other Significant in Active Observable Unobservable Total as of Markets Inputs Inputs December 31, (Level 1) (Level 2) (Level 3) 2009 Assets: Commodity derivative contracts $ 10 $ 349 $ $ 359 Nonqualified benefit plans 99 10 109 Liabilities: Commodity derivative contracts 100 9 109 Certain nonqualified benefit plans 34 34 Fair Value Measurements Using Quoted Significant Prices Other Significant in Active Observable Unobservable Total as of Markets Inputs Inputs December 31, (Level 1) (Level 2) (Level 3) 2008 Assets: Commodity derivative contracts $ 40 $ 610 $ $ 650 Nonqualified benefit plans 98 98 Alon earn-out agreement 13 13 Liabilities: Commodity derivative contracts 7 7 Certain nonqualified benefit plans 26 26 The valuation methods used to measure our financial instruments at fair value are as follows: Commodity derivative contracts, consisting primarily of exchange-traded futures and swaps, are measured at fair value using the market approach. Exchange-traded futures are valued based on quoted prices from the exchange and are categorized in Level 1 of the fair value hierarchy. Swaps are priced using third-party broker quotes, industry pricing services, and exchange-traded curves, with appropriate consideration of counterparty credit risk, but since they have c

Price Risk Management Activitie

Price Risk Management Activities
	12 Months Ended Dec. 31, 2009 USD / shares
Price Risk Management Activities [Abstract]
PRICE RISK MANAGEMENT ACTIVITIES	18. PRICE RISK MANAGEMENT ACTIVITIES We enter into derivative instruments to manage our exposure to commodity price risk, interest rate risk, and foreign currency risk, and to hedge price risk on other contractual derivatives into which we have entered. In addition, we use derivative instruments for trading purposes based on our fundamental and technical analysis of market conditions. All derivative instruments are recorded on our balance sheet as either assets or liabilities measured at their fair values. When we enter into a derivative instrument, it is designated as a fair value hedge, a cash flow hedge, an economic hedge, or a trading activity. The gain or loss on a derivative instrument designated and qualifying as a fair value hedge, as well as the offsetting loss or gain on the hedged item attributable to the hedged risk, are recognized currently in income in the same period. The effective portion of the gain or loss on a derivative instrument designated and qualifying as a cash flow hedge is initially reported as a component of other comprehensive income and is then recorded in income in the period or periods during which the hedged forecasted transaction affects income. The ineffective portion of the gain or loss on the cash flow derivative instrument, if any, is recognized in income as incurred. For our economic hedging relationships (hedges not designated as fair value or cash flow hedges) and for derivative instruments entered into by us for trading purposes, the derivative instrument is recorded at fair value and changes in the fair value of the derivative instrument are recognized currently in income. The cash flow effects of all of our derivative contracts are reflected in operating activities in the consolidated statements of cash flows for all periods presented. Commodity Price Risk We are exposed to market risks related to the volatility of crude oil, refined product, and grain prices, as well as volatility in the price of natural gas used in our refining operations. To reduce the impact of this price volatility on our results of operations and cash flows, we use commodity derivative instruments, including swaps, futures, and options, to manage our exposure to commodity price risks. For such risk management purposes, we use fair value hedges, cash flow hedges, and economic hedges. In addition to the use of derivative instruments to manage commodity price risk, we also enter into certain commodity derivative instruments for trading purposes. Our objectives for entering into each of these types of derivative instruments and the level of activity of each as of December31, 2009 are described below. Fair Value Hedges Fair value hedges are used to hedge certain refining inventories and firm commitments to purchase inventories. The level of activity for our fair value hedges is based on the level of our operating inventories, and normally represents the amount by which our inventories differ from our previous year-end LIFO inventory levels. As of December31, 2009, we had the following outstanding commodity derivative instruments that were entered into to hedge crude oil and refined product inventories. The infor

Income Taxes

Income Taxes
	12 Months Ended Dec. 31, 2009 USD / shares
Income Taxes [Abstract]
INCOME TAXES	19. INCOME TAXES Income (loss)from continuing operations before income tax expense (benefit)from domestic and foreign operations was as follows (in millions): Year Ended December 31, 2009 2008 2007 U.S. operations $ (504 ) $ (64 ) $ 5,556 Canadian operations 222 605 458 Aruban operations (167 ) (14 ) 422 Income (loss)from continuing operations before income tax expense (benefit) $ (449 ) $ 527 $ 6,436 The following is a reconciliation of income tax expense (benefit)related to continuing operations to income taxes computed by applying the statutory federal income tax rate (35% for all years presented) to income (loss)from continuing operations before income tax expense (benefit) (in millions): Year Ended December 31, 2009 2008 2007 Federal income tax expense (benefit) at the U.S. statutory rate $ (157 ) $ 184 $ 2,253 U.S. state income tax expense (benefit), net of U.S. federal income tax effect (12 ) 30 78 U.S. manufacturing deduction 9 (59 ) (84 ) Canadian operations (6 ) (27 ) (48 ) Aruban operations 81 7 (144 ) Goodwill impairment 1,353 Permanent differences (7 ) 26 16 Other, net (5 ) 25 (12 ) Income tax expense (benefit) $ (97 ) $ 1,539 $ 2,059 The Aruba Refinerys profits are currently non-taxable in Aruba due to a tax holiday granted by the GOA. The tax holiday had an immaterial effect on our consolidated results of operations for the years ended December31, 2009, 2008, and 2007. Components of income tax expense (benefit)related to continuing operations were as follows (in millions): Year Ended December 31, 2009 2008 2007 Current: U.S. federal $ (379 ) $ 828 $ 1,710 U.S. state (14 ) 18 93 Canada 120 45 202 Aruba 22 2 3 Total current (251 ) 893 2,008 Deferred: U.S. federal 212 478 114 U.S. state (5 ) 28 27 Canada (53 ) 140 (90 ) Total deferred 154 646 51 Income tax expense (benefit) $ (97 ) $ 1,539 $ 2,059 The tax effects of significant temporary differences representing deferred income tax assets and liabilities were as follows (in millions): December 31, 2009 2008 Deferred income tax assets: Tax credit carryforwards $ 88 $ 91 Net operating losses (NOL) 241 78 Compensation and employee benefit liabilities 304 394 Environmental 84 93 Inventories 152 72

Segment Information

Segment Information
	12 Months Ended Dec. 31, 2009 USD / shares
Segment Information [Abstract]
SEGMENT INFORMATION	20. SEGMENT INFORMATION Prior to the second quarter of 2009, we had two reportable segments, which were refining and retail. As a result of the VeraSun Acquisition during the second quarter of 2009 (as discussed in Note 2), ethanol is now being presented as a third reportable segment. Our refining segment includes refining operations, wholesale marketing, product supply and distribution, and transportation operations. The retail segment includes company-operated convenience stores, Canadian dealers/jobbers and truckstop facilities, cardlock facilities, and home heating oil operations. Our ethanol segment includes sales of internally-produced ethanol and distillers grains. Operations that are not included in any of the three reportable segments are included in the corporate category. The reportable segments are strategic business units that offer different products and services. They are managed separately as each business requires unique technology and marketing strategies. Performance is evaluated based on operating income. Intersegment sales are generally derived from transactions made at prevailing market rates. The following table reflects activity related to continuing operations (in millions): Refining Retail Ethanol Corporate Total Year ended December31, 2009: Operating revenues from external customers $ 59,061 $ 7,885 $ 1,198 $ $ 68,144 Intersegment revenues 5,137 137 5,274 Depreciation and amortization expense 1,261 101 18 48 1,428 Operating income (loss) 105 293 165 (621 ) (58 ) Total expenditures for long-lived assets 2,482 66 5 39 2,592 Year ended December31, 2008: Operating revenues from external customers 102,608 10,528 113,136 Intersegment revenues 7,703 7,703 Depreciation and amortization expense 1,214 105 44 1,363 Operating income (loss) 995 369 (603 ) 761 Total expenditures for long-lived assets 2,689 104 141 2,934 Year ended December31, 2007: Operating revenues from external customers 81,103 8,884 89,987 Intersegment revenues 6,298 6,298 Depreciation and amortization expense 1,106 90 48 1,244 Operating income (loss) 7,067 249 (686 ) 6,630 Total expenditures for long-lived assets 2,342 107 193 2,642 Our principal products include conventional and CARB (California Air Resources Board) gasolines, RBOB (reformulated gasoline blendstock for oxygenate blending), ultra-low-sulfur diesel, and oxygenates and other gasoline blendstocks. We also produce a substantial slate of middle distillates, jet fuel, and petrochemicals, in addition

Employee Benefit Plans

Employee Benefit Plans
	12 Months Ended Dec. 31, 2009 USD / shares
Employee Benefit Plans [Abstract]
EMPLOYEE BENEFIT PLANS	21. EMPLOYEE BENEFIT PLANS Pension Plans and Postretirement Benefits Other Than Pensions We have several qualified non-contributory defined benefit pension plans (collectively, the Qualified Plans), some of which are subject to collective bargaining agreements. The Qualified Plans cover substantially all employees in the United States and generally provide eligible employees with retirement income based on years of service and compensation during specific periods. We also have several nonqualified supplemental executive retirement plans (Supplemental Plans), which provide additional pension benefits to executive officers and certain other employees. The Supplemental Plans and the Qualified Plans are collectively referred to as the Pension Plans. We also provide certain health care and life insurance benefits for retired employees, referred to as other postretirement benefits. Substantially all of our employees may become eligible for these benefits if, while still working for us, they either reach normal retirement age or take early retirement. We offer health care benefits through a self-insured plan and, for certain locations, a health maintenance organization while life insurance benefits are provided through an insurance company. We fund our postretirement benefits other than pensions on a pay-as-you-go basis. Individuals who became our employees as a result of an acquisition became eligible for other postretirement benefits under our plan as determined by the terms of the relevant acquisition agreement. The changes in benefit obligation, the changes in fair value of plan assets, and the funded status of our Pension Plans and other postretirement benefit plans as of and for the years ended December31, 2009 and 2008 were as follows (in millions): Other Postretirement Pension Plans Benefit Plans 2009 2008 2009 2008 Change in benefit obligation: Benefit obligation at beginning of year $ 1,492 $ 1,292 $ 520 $ 477 Service cost 104 92 12 13 Interest cost 79 76 25 28 Participant contributions 9 7 Plan amendments (51 ) Special termination benefits 6 1 Medicare subsidy for prescription drugs 1 2 Benefits paid (74 ) (75 ) (28 ) (27 ) Actuarial (gain)loss (153 ) 107 (27 ) 26 Foreign currency exchange rate changes 4 (6 ) Benefit obligation at end of year $ 1,454 $ 1,492 $ 466 $ 520 Change in plan assets: Fair value of plan assets at beginning of year $ 1,005 $ 1,358 $ $ Actual return on plan assets 228 (400 ) Valero contributions 92 122 18 18 Participant contributions 9 7 Medicare subsidy for prescription drugs 1 2 Ben

Stock-Based Compensation

Stock-Based Compensation
	12 Months Ended Dec. 31, 2009 USD / shares
Stock-Based Compensation [Abstract]
STOCK-BASED COMPENSATION	22. STOCK-BASED COMPENSATION We have various fixed and performance-based stock compensation plans under which awards have been granted, which are summarized as follows: The 2005 Omnibus Stock Incentive Plan (the OSIP) authorizes the grant of various stock and stock-based awards to our employees and our non-employee directors. Awards available under the OSIP include options to purchase shares of common stock, performance awards that vest upon the achievement of an objective performance goal, and restricted stock that vests over a period determined by our compensation committee. As of December31, 2009, a total of 12,002,043 shares of our common stock remained available to be awarded under the OSIP. A non-employee director stock option plan provided our non-employee directors with grants of stock options to purchase our common stock. Effective January1, 2007, each director was granted an option to purchase 10,000 shares of our common stock upon initial election to our board of directors. These options expire seven years from the date of grant. Effective April23, 2007, no further options may be granted under this plan; subsequent option grants are made under the OSIP. Effective January1, 2007, each non-employee director received an annual grant of our common stock valued at $80,000 that vested in three equal annual installments. Effective January1, 2008, each non-employee director receives an annual grant of our common stock valued at $160,000. Vesting will occur based on the number of grants received as follows: (i)initial grants will vest in three equal annual installments, (ii)second grants will vest one-third on the first anniversary of the grant date and the remaining two-thirds on the second anniversary of the grant date, and (iii)all grants thereafter will vest 100% on the first anniversary of the grant date. As of December31, 2009, a total of 139,247 shares of our common stock remained available to be awarded under this plan. The 2003 Employee Stock Incentive Plan authorizes the grant of various stock and stock-related awards to employees and prospective employees. Awards include options to purchase shares of common stock, performance awards that vest upon the achievement of an objective performance goal, stock appreciation rights, and restricted stock that vests over a period determined by our compensation committee. As of December31, 2009, a total of 148,229 shares of our common stock remained available to be awarded under this plan. In addition, we formerly maintained other stock option and incentive plans under which previously granted equity awards remain outstanding. No additional grants may be awarded under these plans. Each of our current stock-based compensation arrangements is discussed below. The tax benefit realized for tax deductions resulting from exercises and vestings under all of our stock-based compensation arrangements totaled $9million, $22million, and $336million for the years ended December31, 2009, 2008, and 2007, respectively. Stock Options Under the terms of our various stock option plans, the exercise price of options granted is not less than the fair

Commitments and Contingencies

Commitments and Contingencies
	12 Months Ended Dec. 31, 2009 USD / shares
Commitments and Contingencies [Abstract]
COMMITMENTS AND CONTINGENCIES	23. COMMITMENTS AND CONTINGENCIES Leases We have long-term operating lease commitments for land, office facilities, retail facilities and related equipment, transportation equipment, time charters for ocean-going tankers and coastal vessels, dock facilities, and various facilities and equipment used in the storage, transportation, production, and sale of refinery feedstocks and refined products. Certain leases for processing equipment and feedstock and refined product storage facilities provide for various contingent payments based on, among other things, throughput volumes in excess of a base amount. Certain leases for vessels contain renewal options and escalation clauses, which vary by charter, and provisions for the payment of chartering fees, which either vary based on usage or provide for payments, in addition to established minimums, that are contingent on usage. Leases for convenience stores may also include provisions for contingent rental payments based on sales volumes. In most cases, we expect that in the normal course of business, our leases will be renewed or replaced by other leases. As of December31, 2009, our future minimum rentals and minimum rentals to be received under subleases for leases having initial or remaining noncancelable lease terms in excess of one year were as reflected in the following table (in millions): Operating Capital Leases Leases 2010 $ 348 $ 7 2011 230 6 2012 127 6 2013 86 6 2014 65 5 Remainder 297 17 Total minimum rental payments 1,153 47 Less minimum rentals to be received under subleases (20 ) Net minimum rental payments $ 1,133 47 Less interest expense (11 ) Capital lease obligations $ 36 Consolidated rental expense for all operating leases related to continuing operations was as follows (in millions): Year Ended December 31, 2009 2008 2007 Minimum rental expense $ 534 $ 514 $ 509 Contingent rental expense 21 23 24 Total rental expense 555 537 533 Less sublease rental income (4 ) (4 ) (4 ) Net rental expense $ 551 $ 533 $ 529 Other Commitments We have various purchase obligations under certain industrial gas and chemical supply arrangements (such as hydrogen supply arrangements), crude oil and other feedstock supply arrangements, and various throughput and terminalling agreements. We enter into these contracts to ensure an adequate supply of utilities and feedstock and adequate storage capacity to operate our refineries. Substantially all of our purchase obligations are based on market prices or adjustments based on market indices. Certain of these purchase obligations include fixed or minimum volume requirements, while others are based on our usage requirements. None of these obligations are associated with supp

Environmental Matters

Environmental Matters
	12 Months Ended Dec. 31, 2009 USD / shares
Environmental Matters [Abstract]
ENVIRONMENTAL MATTERS	24. ENVIRONMENTAL MATTERS Remediation Liabilities Liabilities for future remediation costs are recorded when environmental assessments and/or remedial efforts are probable and the costs can be reasonably estimated. Other than for assessments, the timing and magnitude of these accruals generally are based on the completion of investigations or other studies or a commitment to a formal plan of action. Environmental liabilities are based on best estimates of probable undiscounted future costs using currently available technology and applying current regulations, as well as our own internal environmental policies. The balance of and changes in the accruals for environmental matters (excluding asset retirement obligations), which are principally included in other long-term liabilities described in Note 13, were as follows (in millions): Year Ended December 31, 2009 2008 2007 Balance as of beginning of year $ 297 $ 285 $ 298 Adjustments to estimates, net 16 72 36 Payments, net of third-party recoveries (40 ) (51 ) (55 ) Foreign currency translation 6 (9 ) 6 Balance as of end of year $ 279 $ 297 $ 285 The balance of accruals for environmental matters is included in the consolidated balance sheet as follows (in millions): December 31, 2009 2008 Accrued expenses $ 41 $ 42 Other long-term liabilities 238 255 Accruals for environmental matters $ 279 $ 297 In connection with our various acquisitions, we assumed certain environmental liabilities including, but not limited to, certain remediation obligations, site restoration costs, and certain liabilities relating to soil and groundwater remediation. In addition, we have indemnified NuStar Energy L.P. for certain environmental liabilities related to assets we previously sold to NuStar Energy L.P. that were known on the date the assets were sold or are discovered within a specified number of years after the assets were sold and result from events occurring or conditions existing prior to the date of sale. We believe that we have adequately provided for our environmental exposures with the accruals referred to above. These liabilities have not been reduced by potential future recoveries from third parties. Environmental liabilities are difficult to assess and estimate due to unknown factors such as the timing and extent of remediation, the determination of our obligation in proportion to other parties, improvements in remediation technologies, and the extent to which environmental laws and regulations may change in the future.

Litigation Matters

Litigation Matters
	12 Months Ended Dec. 31, 2009 USD / shares
Litigation Matters [Abstract]
LITIGATION MATTERS	25. LITIGATION MATTERS MTBE Litigation As of February 26, 2010, we were named as a defendant in 34 active cases alleging liability related to MTBE contamination in groundwater. The plaintiffs are generally water providers, governmental authorities, and private water companies alleging that refiners and marketers of MTBE and gasoline containing MTBE are liable for manufacturing or distributing a defective product. We have been named in these lawsuits together with many other refining industry companies. We are being sued primarily as a refiner and marketer of MTBE and gasoline containing MTBE. We do not own or operate gasoline station facilities in most of the geographic locations in which damage is alleged to have occurred. The lawsuits generally seek individual, unquantified compensatory and punitive damages, injunctive relief, and attorneys fees. Many of the cases are pending in federal court and are consolidated for pre-trial proceedings in the U.S. District Court for the Southern District of New York (Multi-District Litigation Docket No.1358, In re: Methyl-Tertiary Butyl Ether Products Liability Litigation). Sixteen cases are pending in state court. Discovery is open in all cases. We believe that we have strong defenses to all claims and are vigorously defending the lawsuits. We have recorded a loss contingency liability with respect to our MTBE litigation portfolio. However, due to the inherent uncertainty of litigation, we believe that it is reasonably possible that we may suffer a loss with respect to one or more of the lawsuits in excess of the amount accrued. We believe that such an outcome in any one of these lawsuits would not have a material adverse effect on our results of operations or financial position. An estimate of the possible loss or range of loss from an adverse result in all or substantially all of these cases cannot reasonably be made. Retail Fuel Temperature Litigation As of February 26, 2010, we were named in 21 consumer class action lawsuits relating to fuel temperature. We have been named in these lawsuits together with several other defendants in the retail and wholesale petroleum marketing business. The complaints, filed in federal courts in several states, allege that because fuel volume increases with fuel temperature, the defendants have violated state consumer protection laws by failing to adjust the volume or price of fuel when the fuel temperature exceeded 60degrees Fahrenheit. The complaints seek to certify classes of retail consumers who purchased fuel in various locations. The complaints seek an order compelling the installation of temperature correction devices as well as monetary relief. The federal lawsuits are consolidated into a multi-district litigation case in the U.S. District Court for the District of Kansas (Multi-District Litigation Docket No.1840, In re: Motor Fuel Temperature Sales Practices Litigation). Discovery has commenced. The court has indicated that it will rule on the Kansas-based class certification motion only (possibly in the spring of 2010), and then make a decision on how to further proceed with the rest of the docket. We believe that we have several strong defens

Condensed Consolidating Financi

Condensed Consolidating Financial Information
	12 Months Ended Dec. 31, 2009 USD / shares
Condensed Consolidating Financial Information [Abstract]
CONDENSED CONSOLIDATING FINANCIAL INFORMATION	26. CONDENSED CONSOLIDATING FINANCIAL INFORMATION In conjunction with the Premcor Acquisition on September1, 2005, Valero Energy Corporation has fully and unconditionally guaranteed the following debt of The Premcor Refining Group Inc. (PRG), a wholly owned subsidiary of Valero Energy Corporation, that was outstanding as of December31, 2009: 6.75% senior notes due February2011, 6.125% senior notes due May2011, 6.75% senior notes due May2014, and 7.5% senior notes due June2015. In addition, PRG has fully and unconditionally guaranteed all of the outstanding debt issued by Valero Energy Corporation. The following condensed consolidating financial information is provided for Valero and PRG as an alternative to providing separate financial statements for PRG. The accounts for all companies reflected herein are presented using the equity method of accounting for investments in subsidiaries. Condensed Consolidating Balance Sheet as of December31, 2009 (in millions) Valero Other Non- Energy Guarantor Corporation PRG Subsidiaries Eliminations Consolidated ASSETS Current assets: Cash and temporary cash investments $ 78 $ $ 747 $ $ 825 Restricted cash 1 121 122 Receivables, net 24 3,749 3,773 Inventories 420 4,443 4,863 Income taxes receivable 858 888 (858 ) 888 Deferred income taxes 180 180 Prepaid expenses and other 5 256 261 Assets related to discontinued operations 11 11 Total current assets 936 461 10,384 (858 ) 10,923 Property, plant and equipment, at cost 4,234 24,372 28,606 Accumulated depreciation (402 ) (5,192 ) (5,594 ) Property, plant and equipment, net 3,832 19,180 23,012 Intangible assets, net 227 227 Investment in Valero Energy affiliates 6,456 3,807 68 (10,331 ) Long-term notes receivable from affiliates 14,181 (14,181 ) Deferred income tax receivable 809 (809 ) Deferred charges and other assets, net 133 67 1,195 1,395 Long-term assets related to discontinued operations 72 72 Total assets $ 22,515 $ 8,239 $ 31,054 $ (26,179 ) $ 35,629 LIABILITIES AND STOCKHOLDERS EQUITY Current liabilities: Current portion of debt and capital lease obligations $ 33 $ $ 204

Quarterly Results of Operations

Quarterly Results of Operations (Unaudited)
	12 Months Ended Dec. 31, 2009 USD / shares
Quarterly Results of Operations (Unaudited) [Abstract]
QUARTERLY RESULTS OF OPERATIONS (Unaudited)	27. QUARTERLY RESULTS OF OPERATIONS (Unaudited) Our results of operations by quarter for the years ended December31, 2009 and 2008 were as follows (in millions, except per share amounts): 2009 Quarter Ended March 31 June 30 September 30 December 31 (a) Operating revenues (b) $ 13,329 $ 17,375 $ 18,573 $ 18,867 Operating income (loss) (b) 593 (192 ) (238 ) (221 ) Net income (loss) 309 (254 ) (629 ) (1,408 ) Earnings (loss)per common share (c) 0.60 (0.48 ) (1.12 ) (2.51 ) Earnings (loss)per common share assuming dilution (c) 0.59 (0.48 ) (1.12 ) (2.51 ) 2008 Quarter Ended March 31 June 30 September 30 (d) December 31 (e) Operating revenues (b) $ 26,443 $ 34,824 $ 34,038 $ 17,831 Operating income (loss) (b) 498 1,268 1,787 (2,792 ) Net income (loss) 261 734 1,152 (3,278 ) Earnings (loss)per common share (c) 0.49 1.39 2.20 (6.36 ) Earnings (loss)per common share assuming dilution (c) 0.48 1.37 2.18 (6.36 ) (a) Net loss for the quarter ended December31, 2009 includes the after-tax effect of a $1.9billion loss related to the shutdown of the Delaware City Refinery, as discussed in Note2. (b) Operating revenues and operating income for 2009 and 2008 exclude the operations related to the Delaware City Refinery, which are reported as discontinued operations. (c) Earnings per common share amounts are computed independently for each of the quarters presented. Therefore, the sum of the quarterly earnings per share may not equal the annual earnings per share. (d) Operating income and net income for the quarter ended September30, 2008 include $305million and $170million, respectively, related to a gain on the sale of the Krotz Springs Refinery in July2008, as discussed in Note 2. (e) Operating loss and net loss for the quarter ended December31, 2008 both include charges of $4.0billion resulting from a goodwill impairment loss, as discussed in Note 3.