EXHIBIT 12.1
TESORO PETROLEUM CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND EARNINGS
TO COMBINED FIXED CHARGES PLUS PREFERRED STOCK DIVIDEND REQUIREMENTS
(DOLLARS IN THOUSANDS)
YEARS ENDED DECEMBER 31,
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1997 1998 1999 2000 2001
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EARNINGS:
Earnings from continuing operations before income taxes
and extraordinary loss $ 3,400 $ 12,100 $ 51,200 $123,500 $146,900
Interest expense, net of capitalized interest (a) 8,100 24,790 36,710 31,720 51,630
Amortization of debt discount - 100 215 235 260
Amortization of debt issuance costs - 310 675 745 910
Estimated interest portion of rents (b) 12,400 17,400 22,400 19,800 17,010
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Total Earnings $ 23,900 $ 54,700 $111,200 $176,000 $216,710
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FIXED CHARGES:
Interest expense whether expensed or capitalized $ 8,500 $ 24,890 $ 37,310 $ 32,420 $ 56,730
Amortization of debt discount - 100 215 235 260
Amortization of debt issuance costs - 310 675 745 910
Estimated interest portion of rents (b) 12,400 17,400 22,400 19,800 17,010
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Total Fixed Charges $ 20,900 $ 42,700 $ 60,600 $ 53,200 $ 74,910
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PREFERRED DIVIDEND REQUIREMENTS (c) - 9,554 19,078 20,202 10,000
RATIO OF EARNINGS TO FIXED CHARGES 1.14 1.28 1.83 3.31 2.89
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RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDEND REQUIREMENTS 1.14 1.05 1.40 2.40 2.55
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(a) Includes interest expense and other financing costs.
(b) For a majority of the marine charter leases the interest portion of rents
was estimated by using the Company's incremental borrowing rate in effect
at the inception of the leases. For the remaining leases, interest expense
was estimated by using one third of the rental payments. Total rental
expense including marine charters was approximately $45 million, $54
million, $64 million, $60 million and $66 million for the years ended 1997,
1998, 1999, 2000 and 2001, respectively.
(c) Represents the amount of pretax earnings that was required to pay dividends
on preferred stock outstanding during the periods presented.