Sunoco Logistics Reports Record Earnings for the First Quarter 2013

Sunoco Logistics Reports Record Earnings for the First Quarter 2013

PHILADELPHIA--(BUSINESS WIRE)-- Sunoco Logistics Partners L.P. (NYSE: SXL) (the "Partnership") today announced its results for the first quarter ended March 31, 2013. Adjusted EBITDA for the three months ended March 31, 2013 increased $67 million to $236 million compared to the first quarter 2012. Net income attributable to partners for the first quarter 2013 was $140 million ($1.09 per limited partner unit diluted), compared with $95 million ($0.77 per limited partner unit diluted) for the first quarter 2012. Additional highlights include:

• Record distributable cash flow of $195 million

• Ended the quarter with a Debt to Adjusted EBITDA ratio of 2.5x

• 2^nd consecutive five percent quarterly distribution increase; 34 percent distribution increase compared to the first quarter 2012

• Acquired the Marcus Hook facility from Sunoco for $60 million in April 2013

• Received sufficient commitments for the Mariner South project

• Actively developing a crude oil project in the Eaglebine shale region

"The first quarter was a record financially for our Partnership," said Michael J. Hennigan, president and chief executive officer. "We reached new quarterly highs in both Adjusted EBITDA and distributable cash flow. We were pleased that market conditions were favorable for our business."

Speaking on the Marcus Hook facility purchase, Hennigan said, "The purchase of the Marcus Hook facility demonstrates Sunoco Logistics' continued commitment to pursue opportunistic growth in natural gas liquids (NGLs). Marcus Hook has the deep water berths, rail access, truck capability and pipeline infrastructure to rival existing facilities. In addition, Marcus Hook has the unique feature of five underground caverns to store NGLs on the East Coast. As development of the shale plays in Pennsylvania and neighboring states continue to grow, we plan to create a world class natural gas liquids hub near the Marcellus and Utica shales."

In regard to the success of Mariner South, Hennigan said, "Mariner South is our first example of working together with the Energy Transfer family to optimize our assets and generate opportunities. The project would originate at the Lone Star fractionation facility at Mont Belvieu and connect to a Sunoco Logistics line that runs to our Nederland terminal. Mariner South creates a first-rate Gulf Coast NGL operation in response to the continued growth of NGL production."

On the Partnership's newly announced crude oil project, Hennigan said, "We are pleased to announce the Eaglebine Express. This pipeline would help producers in the growing Eaglebine and Woodbine shale regions deliver their crude oil to key markets along the Gulf Coast. We expect to launch the open season for Eaglebine Express soon."

DETAILS OF FIRST QUARTER SEGMENT ADJUSTED EBITDA

Crude Oil Pipelines

Adjusted EBITDA for the first quarter 2013 increased $1 million compared to the prior year period due primarily to higher throughput volumes and pipeline tariffs which benefitted from the Partnership's expansion projects and strong demand for West Texas crude oil. These improvements were largely offset by higher operating expenses which included lower pipeline operating gains and increased environmental remediation expenses.

Crude Oil Acquisition and Marketing

Adjusted EBITDA for the first quarter 2013 increased $65 million compared to the prior year period due primarily to expanded crude oil volumes and margins which were the result of an expansion in our crude oil trucking fleet and market related opportunities in West Texas.

Terminal Facilities

Adjusted EBITDA for the first quarter 2013 increased $7 million compared to the prior year period. Results for the first quarter 2012 included a $6 million non-recurring gain recognized in connection with the sale of the Big Sandy terminal and pipeline assets. Excluding this item, Adjusted EBITDA increased $13 million due primarily to increased operating results from the Partnership's refined products acquisition and marketing activities and improved results from the Partnership's Eagle Point and Nederland terminals. Partially offsetting these improvements were volume reductions at the Partnership's refinery terminals which were negatively impacted by turnaround activity during the first quarter 2013 and volume reductions at the Partnership's refined products terminals.

Refined Products Pipelines

Adjusted EBITDA for the first quarter 2013 decreased $6 million compared to the prior year period. Results for the first quarter 2012 included a $5 million non-recurring gain recognized in connection with the sale of the Big Sandy terminal and pipeline assets. Excluding this item, Adjusted EBITDA decreased $1 million due primarily to lower volumes resulting from turnaround activity at the Philadelphia refinery and capital work in connection with the Mariner West project. These factors were largely offset by higher contributions from our joint-venture interests and the Inland pipeline.

Financing Update

Net interest expense decreased $5 million to $19 million for the first quarter 2013 compared to the prior year period. The current period includes $6 million related to the non-cash amortization of the fair value adjustments recorded on the Partnership's long-term debt. Excluding this amount, net interest expense increased $1 million compared to the prior year period. Higher interest expense associated with the Partnership's $700 million senior notes offering in January 2013 was largely offset by higher capitalized interest associated with the Partnership's expansion capital program and lower interest expense driven by the repayment of $250 million of senior notes in February 2012. At March 31, 2013, the Partnership's total debt balance was $2.18 billion, excluding $137 million of unamortized fair value adjustments.

CAPITAL EXPENDITURES

The Partnership's expansion capital spending for the three months ended March 31, 2013 included projects to invest in the Partnership's crude oil infrastructure by increasing its pipeline capabilities through previously announced expansion capital projects in West Texas, expand upon refined products acquisition and marketing services, upgrade the service capabilities at the Eagle Point and Nederland terminals and invest in the previously announced Mariner and Allegheny Access projects. The Partnership expects to invest approximately $700 million in expansion capital during 2013, excluding major acquisitions, which will be funded by the $700 million senior notes offering in January 2013. Maintenance capital spending is estimated to be approximately $65 million in 2013.

INVESTOR CALL

The Partnership will host a conference call regarding first quarter results on Thursday, May 9, 2013 at 8:30am ET (7:30am CT). Those wishing to listen can access the call by dialing (USA toll free) 1-800-369-2171; International (USA toll) 1-517-308-9315 and request "Sunoco Logistics Partners Earnings Call, Conference Code: Sunoco Logistics." This event may also be accessed by a webcast, which will be available at www.sunocologistics.com. A number of presentation slides will accompany the audio portion of the call and will be available to be viewed and printed shortly before the call begins. Audio replays of the conference call will be available for two weeks after the conference call beginning approximately two hours following the completion of the call. To access the replay, dial 1-888-568-0502. International callers should dial 1-402-530-7992.

ABOUT SUNOCO LOGISTICS

Sunoco Logistics Partners L.P. (NYSE: SXL), headquartered in Philadelphia, is a master limited partnership that owns and operates a logistics business consisting of a geographically diverse portfolio of complementary crude oil and refined products pipeline, terminalling, and acquisition and marketing assets. SXL's general partner is owned by Energy Transfer Partners, L.P. (NYS: ETP) . For more information, visit the Sunoco Logistics Partners L.P. web site at www.sunocologistics.com.

This release is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat one hundred percent (100%) of distributions by Sunoco Logistics Partners L.P. to non-U.S. investors as being attributable to income that is effectively connected with a United States trade or business. Accordingly, distributions by Sunoco Logistics Partners L.P. to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate.

Portions of this document constitute forward-looking statements as defined by federal law. Although Sunoco Logistics Partners L.P. believes that the assumptions underlying these statements are reasonable, investors are cautioned that such forward-looking statements are inherently uncertain and necessarily involve risks that may affect the Partnership's business prospects and performance causing actual results to differ from those discussed in the foregoing release. Such risks and uncertainties include, by way of example and not of limitation: whether or not the transactions described in the foregoing news release will be cash flow accretive; increased competition; changes in demand for crude oil and refined products that we store and distribute; changes in operating conditions and costs; changes in the level of environmental remediation spending; potential equipment malfunction; potential labor issues; the legislative or regulatory environment; plant construction/repair delays; nonperformance by major customers or suppliers; and political and economic conditions, including the impact of potential terrorist acts and international hostilities. These and other applicable risks and uncertainties have been described more fully in the Partnership's Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 2013, and in the Partnership's subsequent Form 8-K filings. The Partnership undertakes no obligation to update any forward-looking statements in this release, whether as a result of new information or future events.