Revenues and Segment Information

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

REVENUES AND SEGMENT INFORMATION

12.

REVENUES AND SEGMENT INFORMATION

Revenue from Contracts with Customers

Disaggregation of Revenue

Revenue is presented in the table below under “Segment Information” disaggregated by product because this is the level of disaggregation that management has determined to be beneficial to users of our financial statements.

Contract Balances

Contract balances were as follows (in millions):

	June 30, 2020		December 31, 2019		Decrease
Receivables from contracts with customers, included in receivables, net	$	2,603	$	5,610	$	(3,007	)
Contract liabilities, included in accrued expenses	34		55		(21		)

Receivables from contracts with customers is a component of “receivables, net” as presented on the balance sheet. The decrease in “receivables, net” is described in Note 13.

For the six months ended June 30, 2020, we recognized as revenue $52 million that was included in contract liabilities as of December 31, 2019.

Remaining Performance Obligations

We have spot and term contracts with customers, the majority of which are spot contracts with no remaining performance obligations. We do not disclose remaining performance obligations for contracts that have terms of one year or less. The transaction price for our remaining term contracts includes a fixed component and variable consideration (i.e., a commodity price), both of which are allocated entirely to a wholly unsatisfied promise to transfer a distinct good that forms part of a single performance obligation. The fixed component is not material and the variable consideration is highly uncertain. Therefore, as of June 30, 2020, we have not disclosed the aggregate amount of the transaction price allocated to our remaining performance obligations.

Segment Information

We have three reportable segments — refining, renewable diesel, and ethanol. Each segment is a strategic business unit that offers different products and services by employing unique technologies and marketing strategies and whose operations and operating performance are managed and evaluated separately. Operating performance is measured based on the operating income generated by the segment, which includes revenues and expenses that are directly attributable to the management of the respective segment. Intersegment sales are generally derived from transactions made at prevailing market rates. The following is a description of each segment’s business operations.

• The refining segment includes the operations of our 15 petroleum refineries, the associated marketing activities, and logistics assets that support our refining operations. The principal products

manufactured by our refineries and sold by this segment include gasolines and blendstocks, distillates, and other products.

• The renewable diesel segment includes the operations of DGD, our consolidated joint venture as discussed in Note 8. The principal product manufactured by DGD and sold by this segment is renewable diesel. This segment sells some renewable diesel to the refining segment, which is then sold to that segment’s customers.

• The ethanol segment includes the operations of our 14 ethanol plants, the associated marketing activities, and logistics assets that support our ethanol operations. The principal products manufactured by our ethanol plants are ethanol and distillers grains. This segment sells some ethanol to the refining segment for blending into gasoline, which is sold to that segment’s customers as a finished gasoline product.

Operations that are not included in any of the reportable segments are included in the corporate category.

The following tables reflect information about our operating income (loss) by reportable segment (in millions):

	Refining			Renewable Diesel		Ethanol			Corporate and Eliminations			Total
Three months ended June 30, 2020
Revenues:
Revenues from external customers	$	9,615		$	239	$	543		$	—		$	10,397
Intersegment revenues	2			57		38			(97		)	—
Total revenues	9,617			296		581			(97		)	10,397
Cost of sales:
Cost of materials and other	8,539			135		501			(96		)	9,079
LCM inventory valuation adjustment	(2,137		)	—		(111		)	—			(2,248		)
Operating expenses (excluding depreciation and amortization expense reflected below)	928			20		79			—			1,027
Depreciation and amortization expense	533			12		21			—			566
Total cost of sales	7,863			167		490			(96		)	8,424
Other operating expenses	3			—		—			—			3
General and administrative expenses (excluding depreciation and amortization expense reflected below)	—			—		—			169			169
Depreciation and amortization expense	—			—		—			12			12
Operating income by segment	$	1,751		$	129	$	91		$	(182	)	$	1,789
Three months ended June 30, 2019
Revenues:
Revenues from external customers	$	27,746		$	222	$	964		$	1		$	28,933
Intersegment revenues	8			73		53			(134		)	—
Total revenues	27,754			295		1,017			(133		)	28,933
Cost of sales:
Cost of materials and other	25,172			189		855			(133		)	26,083
Operating expenses (excluding depreciation and amortization expense reflected below)	1,026			17		132			—			1,175
Depreciation and amortization expense	518			12		22			—			552
Total cost of sales	26,716			218		1,009			(133		)	27,810
Other operating expenses	1			—		1			—			2
General and administrative expenses (excluding depreciation and amortization expense reflected below)	—			—		—			199			199
Depreciation and amortization expense	—			—		—			14			14
Operating income by segment	$	1,037		$	77	$	7		$	(213	)	$	908

	Refining			Renewable Diesel		Ethanol			Corporate and Eliminations			Total
Six months ended June 30, 2020
Revenues:
Revenues from external customers	$	30,600		$	545	$	1,354		$	—		$	32,499
Intersegment revenues	4			110		102			(216		)	—
Total revenues	30,604			655		1,456			(216		)	32,499
Cost of sales:
Cost of materials and other	27,666			265		1,314			(214		)	29,031
LCM inventory valuation adjustment	277			—		17			—			294
Operating expenses (excluding depreciation and amortization expense reflected below)	1,923			40		188			—			2,151
Depreciation and amortization expense	1,069			23		43			—			1,135
Total cost of sales	30,935			328		1,562			(214		)	32,611
Other operating expenses	5			—		—			—			5
General and administrative expenses (excluding depreciation and amortization expense reflected below)	—			—		—			346			346
Depreciation and amortization expense	—			—		—			25			25
Operating income (loss) by segment	$	(336	)	$	327	$	(106	)	$	(373	)	$	(488	)
Six months ended June 30, 2019
Revenues:
Revenues from external customers	$	50,964		$	474	$	1,757		$	1		$	53,196
Intersegment revenues	10			124		105			(239		)	—
Total revenues	50,974			598		1,862			(238		)	53,196
Cost of sales:
Cost of materials and other	46,337			413		1,549			(238		)	48,061
Operating expenses (excluding depreciation and amortization expense reflected below)	2,097			36		257			—			2,390
Depreciation and amortization expense	1,021			23		45			—			1,089
Total cost of sales	49,455			472		1,851			(238		)	51,540
Other operating expenses	3			—		1			—			4
General and administrative expenses (excluding depreciation and amortization expense reflected below)	—			—		—			408			408
Depreciation and amortization expense	—			—		—			28			28
Operating income by segment	$	1,516		$	126	$	10		$	(436	)	$	1,216

The following table provides a disaggregation of revenues from external customers for our principal products by reportable segment (in millions):

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Refining:
Gasolines and blendstocks	$	3,993	$	11,530	$	12,237	$	20,904
Distillates	4,379		13,476		15,042		25,393
Other product revenues	1,243		2,740		3,321		4,667
Total refining revenues	9,615		27,746		30,600		50,964
Renewable diesel:
Renewable diesel	239		222		545		474
Ethanol:
Ethanol	432		774		1,061		1,394
Distillers grains	111		190		293		363
Total ethanol revenues	543		964		1,354		1,757
Corporate – other revenues	—		1		—		1
Revenues	$	10,397	$	28,933	$	32,499	$	53,196

Total assets by reportable segment were as follows (in millions):

	June 30, 2020		December 31, 2019
Refining	$	42,225	$	47,067
Renewable diesel	1,504		1,412
Ethanol	1,687		1,615
Corporate and eliminations	3,683		3,770
Total assets	$	49,099	$	53,864