Debt

9 Months Ended

Sep. 30, 2011

Debt [Abstract]

Debt

8. Debt.

In July 2011, the Partnership issued $600 million of long-term debt, consisting of $300 million of 4.65 percent notes due in 2022 and $300 million of 6.10 percent notes due in 2042.

Also in July 2011, concurrent with its initial public offering ("SunCoke IPO"), SunCoke Energy issued $400 million aggregate principal of 7.625 percent notes which mature in 2019. Concurrent with its IPO, SunCoke Energy also borrowed $300 million under a senior secured term loan credit facility which matures in 2018 and entered into a $150 million senior secured revolving credit facility which expires in July 2016. There were no borrowings under the senior secured revolving credit facility at September 30, 2011. The term loan credit facility will amortize in quarterly installments equal to 0.25 percent of the original principal amount of the term loan credit facility with the balance payable at maturity and bears interest at a rate based on SunCoke Energy's election of available alternatives which includes LIBOR (with a floor of 1.00 percent) plus 3.00 percent. These facilities are secured on a first priority basis by a perfected security interest in substantially all of SunCoke Energy's and each SunCoke Energy subsidiary guarantor's tangible and intangible assets (subject to certain exceptions). SunCoke Energy used a portion of the proceeds from borrowings to repay $575 million of intercompany debt payable to a subsidiary of Sunoco in the third quarter of 2011.

Sunoco, Inc. has a $1.2 billion revolving credit facility with a syndicate of 17 participating banks (the "Facility") which matures in August 2012. The Facility provides the Company with access to short-term financing and is intended to support the issuance of commercial paper, letters of credit and other debt. The Company also can borrow directly from the participating banks under the Facility. The Facility is subject to commitment fees, which are not material. The Facility is also subject to certain covenants (as defined in the Facility) including the requirement that Sunoco maintain tangible net worth (as defined in the Facility) in an amount greater than or equal to targeted tangible net worth (as defined in the Facility) for each quarter ended after March 31, 2004. In September 2011, Sunoco obtained a 90-day consent and waiver from the participating banks related to this covenant as the reduction in net worth resulting from charges to be taken by the Company in the third quarter of 2011 for asset write-downs of the Company's refineries was expected to result in a violation of this covenant. Sunoco is currently negotiating an asset-backed facility that would be secured by certain Company assets as a source of liquidity.

In August 2011, the Partnership replaced its existing $458 million of credit facilities with two new credit facilities totaling $550 million. The Partnership's new credit facilities consist of a five-year $350 million unsecured credit facility and a $200 million 364-day unsecured credit facility which is available to fund certain crude oil inventory activities.