Sunoco 8-K Sunoco Reports Fourth Quarter 2006 Results

4Q06 Earnings Conference Call

February 1, 2007

1

Exhibit 99.2

Safe Harbor Statement

This

slide

presentation

should

be

reviewed

in

conjunction

with

Sunoco’s

Fourth

Quarter

2006

earnings

conference

call,

held

on

February

1,

2007

at

3:00

p.m.

ET.

You

may

listen

to

the

audio

portion

of

the

conference

call

on

the

website

or

an

audio

recording

will

be

available

after

the

call’s

completion

by

calling

1-800-642-1687

and

entering

conference

ID#5558650.

Those

statements

made

by

representatives

of

Sunoco

during

the

course

of

this

presentation

that

are

not

historical

facts

are

forward-

looking

statements

intended

to

be

covered

by

the

safe

harbor

provisions

of

Section

27A

of

the

Securities

Act

of

1933

and

Section

21E

of

the

Securities

Exchange

Act

of

1934.

These

forward-looking

statements

are

based

upon

a

number

of

assumptions

by

Sunoco

concerning

future

conditions,

any

or

all

of

which

may

ultimately

prove

to

be

inaccurate.

Forward-looking

statements

are

inherently

uncertain

and

necessarily

involve

risks

that

may

affect

Sunoco's

business

prospects

and

performance,

causing

actual

results

to

differ

materially

from

those

discussed

during

this

presentation.

Such

risks

and

uncertainties

include,

by

way

of

example

and

not

of

limitation:

general

economic,

financial

and

business

conditions

which

could

affect

Sunoco’s

financial

condition

and

results

of

operations;

changes

in

competition

and

competitive

practices,

including

the

impact

of

foreign

imports;

effects

of

weather

conditions

and

natural

disasters

on

the

Company’s

operating

facilities

and

on

product

supply

and

demand;

changes

in

refining,

marketing

and

chemical

margins;

variation

in

petroleum-based

commodity

prices

and

availability

of

crude

oil

and

feedstock

supply

or

transportation;

effects

of

transportation

disruptions;

changes

in

the

price

differentials

between

light-sweet

and

heavy-

sour

crude

oils;

changes

in

the

marketplace

which

may

affect

supply

and

demand

for

Sunoco’s

products;

changes

in

the

level

of

capital

or

operating

expenses;

changes

in

product

specifications;

availability

and

pricing

of

ethanol;

changes

in

the

expected

level

of

environmental

capital,

operating

or

remediation

expenditures;

age

of,

and

changes

in,

the

reliability,

efficiency

and

capacity

of,

the

Company’s

operating

facilities

or

those

of

third

parties;

effects

of

adverse

events

relating

to

the

operation

of

the

Company’s

facilities

and

to

the

transportation

and

storage

of

hazardous

materials

(including

equipment

malfunction,

explosions,

fires,

spills

and

the

effects

of

severe

weather

conditions);

risks

related

to

labor

relations

and

workplace

safety;

changes

in

applicable

statutes

and

government

regulations

or

their

interpretations,

including

those

relating

to

the

environment

and

global

warming;

changes

in

tax

laws

or

their

interpretations,

including

pension

funding

requirements;

ability

to

identify

acquisitions,

execute

them

under

favorable

terms

and

integrate

them

into

the

Company’s

existing

businesses;

ability

to

enter

into

joint

ventures

and

other

similar

arrangements

under

favorable

terms;

delays

and/or

costs

related

to

construction,

improvements,

and/or

repairs

of

facilities

(including

shortages

of

skilled

labor,

the

issuance

of

applicable

permits

and

inflation);

non-performance

or

force

majeure

by,

or

disputes

with,

major

customers,

suppliers,

dealers,

distributors

or

other

business

partners;

changes

in

financial

markets

impacting

pension

expense

and

funding

requirements;

political

and

economic

conditions

in

the

markets

in

which

the

Company,

its

suppliers

or

customers

operate,

including

the

impact

of

potential

terrorist

acts

and

international

hostilities;

military

conflicts

between,

or

internal

instability

in,

one

or

more

oil

producing

countries,

governmental

actions

and

other

disruptions

in

the

ability

to

obtain

crude

oil;

and

changes

in

the

status

of,

or

initiation

of,

new,

litigation,

arbitration

or

other

proceedings

to

which

the

Company

is

a

party

or

liability

resulting

from

such

litigation,

arbitration

or

other

proceedings,

including

natural

resource

damage

claims.

These

and

other

applicable

risks

and

uncertainties

have

been

described

more

fully

in

Sunoco's

Third

Quarter

2006

Form

10-Q

filed

with

the

Securities

and

Exchange

Commission

on

November

2,

2006.

Other

factors

not

discussed

herein

also

could

materially

and

adversely

affect

Sunoco’s

business

prospects

and/or

performance.

All

forward-looking

statements

included

in

this

presentation

are

expressly

qualified

in

their

entirety

by

the

foregoing

cautionary

statements.

Sunoco

undertakes

no

obligation

to

update

any

forward-looking

statements

whether

as

a

result

of

new

information

or

future

events.

2

Earnings Profile

3

4Q05

FY05

1Q06

2Q06

3Q06

4Q06

FY06

Net Income (MM$ after tax):

Refining & Supply

286

947

73

409

273

126

881

Retail Marketing

25

30

-

10

77

(11)

76

Chemicals

8

94

14

8

5

16

43

Logistics

3

22

6

12

7

11

36

Coke

10

48

14

10

9

17

50

Corporate Expenses

(27)

(84)

(16)

(11)

(11)

(20)

(58)

Net Financing Expenses & Other

(8)

(45)

(12)

(12)

(9)

(16)

(49)

Income Before Special Items

297

1,012

79

426

351

123

979

Special Items

(10)

(38)

-

-

-

-

-

Total Net Income

287

974

79

426

351

123

979

EPS (Diluted), Before Special Items

2.19

7.36

0.59

3.22

2.76

1.00

7.59

EPS (Diluted), Net Income

2.12

7.08

0.59

3.22

2.76

1.00

7.59

Income Before Special Items*, MM$

4

$123

$979

$351

$426

$79

$1,012

$297

$0

$200

$400

$600

$800

$1,000

$1,200

* For reconciliation to Net Income, see slide 3.

4Q05

FY05

1Q06

2Q06

3Q06

4Q06

FY06

Refining & Supply

286

947

73

409

273

126

881

Non

-Refining

46

194

34

40

98

33

205

Corp. & Net Fin.

(35)

(129)

(28)

(23)

(20)

(36)

(107)

Income Before

Special Items

297

1,012

79

426

351

123

979

EPS (Diluted), Before

Special Items

2.19

7.36

0.59

3.22

2.76

1.00

7.59

Earnings Profile

5

4Q06

4Q05

3Q06

Net Income

(MM$

after tax):

Refining & Supply

126

286

(160)

273

(147)

Retail Marketing

(11)

25

(36)

77

(88)

Chemicals

16

8

8

5

11

Logistics

11

3

8

7

4

Coke

17

10

7

9

8

Corporate Expenses

(20)

(27)

7

(11)

(9)

Net Financing

Expenses & Other

(16)

(8)

(8)

(9)

(7)

Income Before

Special Items

123

297

(174)

351

(228)

Special Items

-

(10)

10

-

-

Total Net Income

123

287

(164)

351

(228)

EPS (Diluted),

Before

Special Items

1.00

2.19

(54%)

2.76

(64%)

EPS

(Diluted), Net Income

1.00

2.12

(53%)

2.76

(64%)

Earnings Profile

6

FY06

FY05

Net Income

(MM$

after tax):

Refining & Supply

881

947

(66)

Retail Marketing

76

30

46

Chemicals

43

94

(51)

Logistics

36

22

14

Coke

50

48

2

Corporate Expenses

(58)

(84)

26

Net Financing

Expenses & Other

(49)

(45)

(4)

Income Before

Special Items

979

1,012

(33)

Special Items

-

(38)

38

Total Net Income

979

974

5

EPS (Diluted),

Before

Special Items

7.59

7.36

3%

EPS

(Diluted), Net

Income

7.59

7.08

7%

Income

Before

Special

Items

*

–

4Q06

vs.

4Q05,

MM$

7

* For reconciliation to Net Income, see slide 3.

4Q05

Actual

4Q06

Actual

Volumes

R&S

(26)

Retail

2

Chemicals

5

Margins

R&S

(127)

Retail

(28)

Chemicals

(7)

297

Expenses/Other

R&S

(7)

Retail

(10)

Chemicals

10

Corporate

7

(162)

(19)

--

7

123

Other

Logistics

8

Coke

7

Financing         (8)

Income

Before

Special

Items

*

–

4Q06

vs.

3Q06,

MM$

8

* For reconciliation to Net Income, see slide 3.

Other

Logistics       4

Coke              8

Financing    (7)

3Q06

Actual

4Q06

Actual

Volumes

R&S

(15)

Retail

-

Chemicals

2

Margins

R&S

(125)

Retail

(73)

Chemicals    9

351

Expenses/Other

R&S

(7)

Retail

(15)

Chemicals

-

Corporate

(9)

(189)

(13)

(31)

123

5

Key Margin Indicators

9

4Q05

FY05

1Q06

2Q06

3Q06

4Q06

FY06

Refining & Supply, $/B

Realized Northeast

9.18

8.35

5.35

11.56

8.35

6.23

7.92

Realized MidContinent

12.25

9.54

8.38

15.00

14.90

11.32

12.46

Realized Total R&S

9.96

8.65

6.13

12.41

10.13

7.51

9.09

Retail Marketing, cpg

Gasoline

11.0

8.1

6.8

8.4

17.3

6.8

9.9

Distillate

13.5

10.7

12.0

8.7

10.4

13.5

11.2

Chemicals, cpp

Phenol and Related

9.3

10.9

9.1

7.1

7.0

8.7

8.0

Polypropylene

14.3

13.9

13.2

11.1

12.2

12.9

12.4

Total Chemicals

11.4

12.1

10.9

8.8

9.3

10.5

9.9

Dated Brent Crude Oil, $/B

56.90

54.41

61.88

69.65

69.41

59.74

65.25

Natural Gas, $/DT

12.86

9.00

7.88

6.67

6.14

7.26

6.99

Refining & Supply –

Realized Margin vs. Benchmark, $/B

10

$2.37

$2.55

$3.06

$2.80

$0.86

$0.59

($0.05)

$2.74

$0.15

$0.77

($1.50)

($3.63)

$0.46

$0.30

($6.00)

($5.00)

($4.00)

($3.00)

($2.00)

($1.00)

$0.00

$1.00

$2.00

$3.00

$4.00

Northeast

MidContinent

* For definition, see slide 16.

4Q05

FY05

1Q06

2Q06

3Q06

4Q06

FY06

Northeast Refining:

6-3-2-1 Benchmark

*

9.23

7.76

4.49

8.76

5.29

3.68

5.55

Crude Differential

(2.29)

(0.37)

(1.19)

(1.06)

(0.58)

(0.26)

(0.77)

Product Differential

2.24

0.96

2.05

3.86

3.64

2.81

3.14

Realized Margin

9.18

8.35

5.35

11.56

8.35

6.23

7.92

MidContinent

Refining:

3-2-1 Benchmark

*

11.95

11.04

7.92

18.63

14.13

8.58

12.31

Crude Differential

(0.51)

(0.40)

0.67

0.58

0.25

1.55

0.75

Product

Differential

0.81

(1.10)

(0.21)

(4.21)

0.52

1.19

(0.60)

Realized Margin

12.25

9.54

8.38

15.00

14.90

11.32

12.46

Refining

&

Supply

-

4Q06

Gasoline

and

Distillate

Production

11

Northeast

Refining

MidContinent

Refining

Total

Refining

& Supply

Gasoline Production

, MB/D

313

.7

106.8

420.5

RFG

50%

0%

37

%

Conventional

50%

100%

63

%

Distillate Production

, MB/D

234

.3

72

.2

306

.5

On-Road Diesel F

uel

49%

34%

46%

Heating Oil / Off

-Road Diesel

30%

32%

30

%

Jet Fuel

17%

34%

21%

Kerosene / Other

4%

0%

3%

Key Volume Indicators

12

4Q05

FY05

1Q06

2Q06

3Q06

4Q06

FY06

Refining & Supply

Northeast:

Crude Throughputs, MB/D

659

651

610

640

612

603

616

% Capacity

101

99

93

98

93

92

94

Net Prod. Available for Sale, MB/D

705

692

664

698

658

662

670

MidContinent:

Crude Throughputs, MB/D

234

230

225

224

238

211

225

% Capacity

95

94

92

92

97

86

92

Net Prod. Available for Sale, MB/D

238

235

233

231

246

221

233

Total Refining & Supply:

Crude

Throughputs, MB/D

893

881

835

864

850

814

841

% Capacity

99

98

93

96

94

90

93

Net Prod. Available for Sale, MB/D

943

927

897

928

904

883

903

Net Prod. Available for Sale, MMB

87

338

81

84

83

81

330

Key Volume Indicators

13

4Q05

FY05

1Q06

2Q06

3Q06

4Q06

FY06

Retail Marketing

Gasoline Sales, MM gal

1,115

4,573

1,086

1,181

1,202

1,179

4,647

Middle Distillate Sales, MM gal

181

694

176

158

158

165

657

Total Sales, MM gal

1,296

5,267

1,262

1,339

1,360

1,344

5,304

Gasoline and Diesel Throughput

(M

gal/Site/Month)

(Company owned or leased outlets)

131

136

132

143

150

149

144

Merchandise Sales (M$/Store/Month)

76

78

71

82

87

80

80

Chemicals

Phenol and Related Sales, MM#

619

2,579

633

663

607

632

2,535

Polypropylene Sales, MM#

512

2,218

562

569

550

562

2,243

Other Sales, MM#

22

91

21

21

21

25

88

Total, MM#

1,153

4,888

1,216

1,253

1,178

1,219

4,866

Coke

Production, M tons

634

2,405

631

627

620

632

2,510

Sales, M tons

610

2,375

647

632

618

637

2,534

Financial Indicators

12/31/05

3/31/06

6/30/06

9/30/06

12/31/06

Total Debt (GAAP Basis)

1,411

1,524

1,438

1,497

1,987

Plus: Debt Guarantees

       7

       6

       6

      6

       5

Less: Cash

   (919)

   (361)

   (600)

(218)

    (263)

Net Debt (Revolver Covenant Basis)

   499

1,169

   844

1,285

1,729

Shareholders’ Equity (GAAP Basis)

2,051

2,027

2,295

2,126

2,075

SXL * Minority Interest

   397

   394

   506

   502

   503

Equity (Revolver Covenant Basis)

2,448

2,421

2,801

2,628

2,578

Debt / Capital (GAAP Basis)

41%

43%

39%

41%

49%

Net Debt / Capital ** 

(Revolver Covenant Basis)

17%

33%

23%

33%

40%

*

Sunoco Logistics Partners L.P. (NYSE: SXL)

**

The

Net

Debt

/

Capital

ratio

is

used

by

Sunoco

management

in

its

internal

financial

analysis

and

by

investors

and

creditors

in

the

assessment

of

Sunoco’s

financial

position.

14

Share Repurchase Activity

15

At 12/31/06:

Shares O/S = 121.3MM

Net Share Reduction in 2006 = 9%

Remaining Authorization = $943MM

Shares

Repurchased

Total

Cost

Average

Price                       

(MM)

(MM$)

($/share)

2000

10.4

144

13.87

2001

21.4

393

18.32

2002

--

--

--

2003

5.8

136

23.36

2004

15.9

568

35.68

2005

6.7

435

64.57

2006

12.2

871

71.13

Total

72.4

2,547

35.10

Appendix: Marker Crack Spread Definition

16

Northeast 6-3-2-1 Benchmark

6 Dated Brent Crude: Platt’s Mid + $1.25 for transportation

3 Unleaded Regular Gasoline: NY Harbor Barge Platt’s Low

2 No. 2 Fuel Oil (Heating Oil): NY Harbor Barge Platt’s Low

1 No. 6 0.3% Sulfur High Pour Resid: NY Harbor Barge Platt’s Low

MidContinent 3-2-1 Benchmark

3 WTI Crude: NYMEX futures L1 Close + $0.75 for transportation

2 Unleaded Regular Gasoline: Chicago Pipeline Platt’s Low

1 No. 2 Low Sulfur (Low Sulfur Diesel): Fuel Oil Chicago Pipeline

Platt’s Low

For More Information

17

Media releases and SEC filings are available

on

our

website

at

www.SunocoInc.com

Contact for more information:

Terry Delaney

(215) 977-6106

Tom Harr

(215) 977-6764