IMPERIAL OIL LTD [IMO] Filings

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer Identification No.)

505 Quarry Park Boulevard S.E. Calgary, Alberta, Canada

(Address of principal executive offices)

(Postal Code)

10-Q 1 d233523d10q.htm 10-Q 10-Q

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission file number 0-12014

IMPERIAL OIL LIMITED

(Exact name of registrant as specified in its charter)

1-800

-567-3776

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading symbol	Name of each exchange on which registered
None		None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.


YES		✓		NO

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T
(§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).


YES		✓		NO

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definition of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act of 1934.


Large accelerated filer	✓	Smaller reporting company
Non-accelerated filer		Emerging growth company
Accelerated filer		.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (

s defined in Rule 12b-2 of the Exchange Act of 1934)


YES				NO		✓

The number of common shares outstanding, as of September 30, 2021 was

695,611,336.

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IMPERIAL OIL LIMITED

Table of contents

Page


PART I. FINANCIAL INFORMATION			3
Item 1. Financial statements			3
Consolidated statement of income			3
Consolidated statement of comprehensive income			4
Consolidated balance sheet			5
Consolidated statement of shareholders’ equity			6
Consolidated statement of cash flows			7
Notes to the consolidated financial statements			8
Item 2. Management’s discussion and analysis of financial condition and results of operations			19
Item 3. Quantitative and qualitative disclosures about market risk			24
Item 4. Controls and procedures			24

PART II. OTHER INFORMATION			25
Item 1. Legal proceedings			25
Item 2. Unregistered sales of equity securities and use of proceeds			25
Item 6. Exhibits			26

SIGNATURES			27

In this report all dollar amounts are expressed in Canadian dollars unless otherwise stated. This report should be read in conjunction with the company’s annual report on Form 10-K for the year ended December 31, 2020. Note that numbers may not add due to rounding.

The term “project” as used in this report can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports.

In this report, unless the context otherwise indicates, reference to “the company” or “Imperial” includes Imperial Oil Limited and its subsidiaries.

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IMPERIAL OIL LIMITED

PART I. FINANCIAL INFORMATION

Item 1.

Financial statements

Consolidated statement of income (U.S. GAAP, unaudited)


	Third Quarter				Nine Months to September 30
millions of Canadian dollars	2021		2020		2021		2020
Revenues and other income
Revenues (a)		10,214		5,937		25,213		16,267
Investment and other income (note 3)		19		18		65		88
Total revenues and other income		10,233		5,955		25,278		16,355

Expenses
Exploration		2		2		6		6
Purchases of crude oil and products (b)		6,298		3,634		15,052		9,975
Production and manufacturing (c) (note 11)		1,525		1,246		4,579		4,098
Selling and general (c)		180		150		569		499
Federal excise tax and fuel charge		535		470		1,404		1,290
Depreciation and depletion (note 11)		488		409		1,432		1,295
Non-service pension and postretirement benefit		11		31		32		91
Financing (d) (note 5)		5		10		32		46
Total expenses		9,044		5,952		23,106		17,300

Income (loss) before income taxes		1,189		3		2,172		(945	)

Income taxes		281		-		506		(234	)

Net income (loss)		908		3		1,666		(711	)

Per share information (Canadian dollars)

Net income (loss) per common share - basic (note 9)		1.30		-		2.32		(0.97	)
Net income (loss) per common share - diluted (note 9)		1.29		-		2.31		(0.97	)

(a) Amounts from related parties included in revenues.		2,731		1,216		5,644		3,699

(b) Amounts to related parties included in purchases of crude oil and products.		828		627		2,009		1,762

(c) Amounts to related parties included in production and manufacturing, and selling and general expenses.		95		107		317		428

(d) Amounts to related parties included in financing, (note 5).		4		12		25		50

The information in the notes to consolidated financi

l statements is an integral part of these statements.

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IMPERIAL OIL LIMITED

Consolidated statement of comprehensive income (U.S. GAAP, unaudited)


	Third Quarter				Nine Months to September 30
millions of Canadian dollars	2021		2020		2021		2020
Net income (loss)		908		3		1,666		(711	)

Other comprehensive income (loss), net of income taxes
Postretirement benefits liability adjustment (excluding amortization)		-		-		54		(114	)
Amortization of postretirement benefits liability adjustment included in net periodic benefit costs		33		34		99		102
Total other comprehensive income (loss)		33		34		153		(12	)

Comprehensive income (loss)		941		37		1,819		(723	)

The information in the notes to cons

lidated financial statements is an integral part of these statements.

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IMPERIAL OIL LIMITED

Consolidated balance sheet (U.S. GAAP, unaudited)


	As at Sept 30			As at Dec 31
millions of Canadian dollars	2021			2020
Assets
Current assets

Cash		1,875			771
Accounts receivable - net (a)		3,871			1,919
Inventories of crude oil and products		1,405			1,161
Materials, supplies and prepaid expenses		729			673
Total current assets		7,880			4,524
Investments and long-term receivables (b)		753			781
Property, plant and equipment,		56,512			55,771
less accumulated depreciation and depletion		(25,134	)		(23,737	)
Property, plant and equipment, net		31,378			32,034
Goodwill (note 11)		166			166
Other assets, including intangibles - net		698			526
Total assets		40,875			38,031

Liabilities
Current liabilities
Notes and loans payable (c)		122			227
Accounts payable and accrued liabilities (a) (note 7)		5,558			3,153
Income taxes payable		269			-
Total current liabilities		5,949			3,380
Long-term debt (d) (note 6)		5,060			4,957
Other long-term obligations (note 7)		4,352			4,100
Deferred income tax liabilities		4,305			4,176
Total liabilities		19,666			16,613

Shareholders’ equity
Common shares at stated value (e) (note 9)		1,286			1,357
Earnings reinvested		21,759			22,050
Accumulated other comprehensive income (loss) (note 10)		(1,836	)		(1,989	)
Total shareholders’ equity		21,209			21,418

Total liabilities and shareholders’ equity		40,875			38,031

(a)	Accounts receivable - net included net amounts receivable from related parties of $1,064 million (2020 - $384 million).

(b)	Investments and long-term receivables included amounts from related parties of $299 million (2020 - $313 million).

(c)	Notes and loans payable included amounts to related parties of $0 million (2020 - $111 million).

(d)	Long-term debt included amounts to related parties of $4,447 million (2020 - $4,447 million).

(e)	Number of common shares authorized and outstanding were 1,100 million and 696 million, respectively (2020 - 1,100 million and 734 million, respectively).

The information in the notes to consolidated financial statements is an int

gral part of these statements.

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IMPERIAL OIL LIMITED

Consolidated statement of shareholders’ equity (U.S. GAAP, unaudited)


	Third Quarter						Nine Months to September 30
millions of Canadian dollars	2021			2020			2021			2020
Common shares at stated value (note 9)
At beginning of p e riod		1,302			1,357			1,357			1,375
Share purchases at stated value		(16	)		-			(71	)		(18	)
At end of period		1,286			1,357			1,286			1,357

Earnings reinvested
At beginning of period		21,336			23,516			22,050			24,812
Net income (loss) for the period		908			3			1,666			(711	)
Share purchases in excess of stated value		(297	)		-			(1,413	)		(256	)
Dividends declared		(188	)		(161	)		(544	)		(485	)
Cumulative effect of accounting change		-			-			-			(2	)
At end of period		21,759			23,358			21,759			23,358

Accumulated other comprehensive income (loss) (note 10)
At beginning of period		(1,869	)		(1,957	)		(1,989	)		(1,911	)
Other comprehensive income (loss)		33			34			153			(12	)
At end of period		(1,836	)		(1,923	)		(1,836	)		(1,923	)

Shareholders’ equity at end of period		21,209			22,792			21,209			22,792

The information in the notes to consolidated financial statements is an integral part of these statements.

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IMPERIAL OIL LIMITED

Consolidated statement of cash flows (U.S. GAAP, unaudited)


Inflow (outflow)	Third Quarter						Nine Months to September 30
millions of Canadian dollars	2021			2020			2021			2020
Operating activities

Net income (loss)		908			3			1,666			(711	)
Adjustments for non-cash items:
Depreciation and depletion		488			409			1,432			1,275
Impairment of int a ngible assets (note 11)		-			-			-			20
(Gain) loss on asset sales (note 3)		(12	)		(11	)		(39	)		(28	)
Deferred income taxes and other		(120	)		(11	)		16			(210	)
Changes in operating assets and liabilities:
Accounts receivable		(708	)		134			(1,952	)		967
Inventories, materials, supplies and prepaid expenses		(199	)		142			(300	)		60
Income taxes payable		227			-			269			(106	)
Accounts payable and accrued liabilities		1,123			66			2,362			(1,008	)
All other items - net (b)		240			143			390			223
Cash flows from (used in) operating activities		1,947			875			3,844			482

Investing activities
Additions to property, plant and equipment		(276	)		(142	)		(684	)		(657	)
Proceeds from asset sales (note 3)		15			19			57			68
Loans to equity companies - net		2			(2	)		14			(16	)
Cash flows from (used in) investing activities		(259	)		(125	)		(613	)		(605	)

Financing activities
Short-term debt - net		(75	)		-			(111	)		-
Reduction in finance lease obligations (note 6)		(6	)		(4	)		(14	)		(16	)
Dividends paid		(195	)		(162	)		(518	)		(488	)
Common shares purchased (note 9)		(313	)		-			(1,484	)		(274	)
Cash flows from (used in) financing activities		(589	)		(166	)		(2,127	)		(778	)

Increase (decrease) in cash		1,099			584			1,104			(901	)
Cash at beginning of period		776			233			771			1,718
Cash at end of period (a)		1,875			817			1,875			817
(a) Cash is composed of cash in bank and cash equivalents at cost. Cash equivalents are all highly liquid securities with maturity of three months or less when purchased.
(b) Included contributions to registered pension plans.		(43	)		(59	)		(113	)		(159	)

Income taxes (paid) refunded.		32			107			60			(45	)
Interest (paid), net of capitalization.		(5	)		(10	)		(32	)		(46	)

The information in the notes to consolidated financial statements is an integral part of these statements.

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IMPERIAL OIL LIMITED

Notes to consolidated financial statements (unaudited)

1. Basis of financial statement preparation

These unaudited consolidated financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) and follow the same accounting policies and methods of computation as, and should be read in conjunction with, the most recent annual consolidated financial statements filed with the U.S. Securities and Exchange Commission (SEC) in the company’s 2020 annual report on Form 10-K. In the

pinion of the company, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein. All such adjustments are of a normal recurring nature.

The company’s exploration and production activities are accounted for under the “successful efforts” method.

The results for the nine months ended September 30, 2021, are not necessarily indicative of the operations to be expected for the full year.

All amounts are in Canadian dollars unless otherwise indicated.

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IMPERIAL OIL LIMITED

2. Business segments


Third Quarter	Upstream		Downstream		Chemical
millions of Canadian dollars	2021	2020	2021	2020	2021	2020
Revenues and other income

Revenues (a)	1,015	1,651	8,813	4,061	386	225
Intersegment sales (b)	3,137	658	366	321	91	43
Investment and other income (note 3)	-	(6)	18	24	-	-
	4,152	2,303	9,197	4,406	477	268
Expenses
Exploration	2	2	-	-	-	-
Purchases of crude oil and products (b)	1,902	1,176	7,745	3,322	244	157
Production and manufacturing (note 11)	1,120	863	356	335	49	48
Selling and general	-	-	141	140	21	23
Federal excise tax and fuel charge	-	-	535	470	-	-
Depreciation and depletion (note 11)	439	361	39	37	4	5
Non-service pension and postretirement benefit	-	-	-	-	-	-
Financing (note 5)	-	-	-	-	-	-
Total expenses	3,463	2,402	8,816	4,304	318	233
Income (loss) before income taxes	689	(99)	381	102	159	35
Income taxes	165	(25)	88	25	38	8
Net income (loss) (b)	524	(74)	293	77	121	27
Cash flows from (used in) operating activities (b)	2,508	526	(733)	333	157	32
Capital and exploration expenditures (c)	151	78	120	50	2	4


Third Quarter	Corporate and other		Eliminations		Consolidated
millions of Canadian dollars	2021	2020	2021	2020	2021	2020
Revenues and other income


Revenues (a)	-	-	-	-	10,214	5,937
Intersegment sales (b)	-	-	(3,594)	(1,022)	-	-
Investment and other income (note 3)	1	-	-	-	19	18
	1	-	(3,594)	(1,022)	10,233	5,955
Expenses
Exploration	-	-	-	-	2	2
Purchases of crude oil and products (b)	-	-	(3,593)	(1,021)	6,298	3,634
Production and manufacturing (note 11)	-	-	-	-	1,525	1,246
Selling and general	19	(12)	(1)	(1)	180	150
Federal excise tax and fuel charge	-	-	-	-	535	470
Depreciation and depletion (note 11)	6	6	-	-	488	409
Non-service pension and postretirement benefit	11	31	-	-	11	31
Financing (note 5)	5	10	-	-	5	10
Total expenses	41	35	(3,594)	(1,022)	9,044	5,952
Income (loss) before income taxes	(40)	(35)	-	-	1,189	3
Income taxes	(10)	(8)	-	-	281	-
Net income (loss) (b)	(30)	(27)	-	-	908	3
Cash flows from (used in) operating activities (b)	15	(16)	-	-	1,947	875
Capital and exploration expenditures (c)	4	9	-	-	277	141

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(a)	Included export sales to the United States of $1,803 million (2020 - $1,227 million). Export sales to the United States were recorded in all operating segments, with the largest effects in the Upstream segment.

(b)	In the third quarter of 2021, the Downstream segment acquired a portion of Upstream crude inventory for $444 million. There was no earnings impact and t he effects of this transaction have been eliminated for consolidation purp o ses.

(c)	Capital and exploration expenditures (CAPEX) include exploration expenses, additions to property, plant and equipment, additions to finance leases, additional investments and acquisitions. CAPEX excludes the purchase of carbon emission credits.

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Nine Months to September 30	Upstream		Downstream		Chemical
millions of Canadian dollars	2021	2020	2021	2020	2021	2020
Revenues and other inco m e
Revenues (a)	5,773	4,211	18,355	11,444	1,085	612
Intersegment sales (b)	5,800	1,642	1,927	1,013	223	114
Investment and other income (note 3)	6	4	51	66	1	1
	11,579	5,857	20,333	12,523	1,309	727
Expenses
Exploration	6	6	-	-	-	-
Purchases of crude oil and products (b)	5,780	3,338	16,525	8,987	693	416
Production and manufacturing (note 11)	3,395	2,855	1,039	1,086	145	157
Selling and general	-	-	416	456	68	69
Federal excise tax and fuel charge	-	-	1,404	1,290	-	-
Depreciation and depletion (note 11)	1,283	1,141	117	123	13	13
Non-service pension and postretirement benefit	-	-	-	-	-	-
Financing (note 5)	1	-	-	-	-	-
Total expenses	10,465	7,340	19,501	11,942	919	655
Income (loss) before income taxes	1,114	(1,483)	832	581	390	72
Income tax expense (benefit)	264	(357)	187	134	93	17
Net income (loss) (b)	850	(1,126)	645	447	297	55
Cash flows from (used in) operating activities (b)	3,634	22	(135)	443	330	75
Capital and exploration expenditures (c)	366	454	308	177	6	15
Total assets as at September 30 (b) (note 11)	29,540	32,941	8,239	4,590	488	417


Nine Months to September 30	Corporate and other		Eliminations		Consolidated
millions of Canadian dollars	2021	2020	2021	2020	2021	2020
Revenues and other income

Revenues (a)	-	-	-	-	25,213	16,267
Intersegment sales (b)	-	-	(7,950)	(2,769)	-	-
Investment and other income (note 3)	7	17	-	-	65	88
	7	17	(7,950)	(2,769)	25,278	16,355
Expenses
Exploration	-	-	-	-	6	6
Purchases of crude oil and products (b)	-	-	(7,946)	(2,766)	15 , 052	9,975
Production and manufacturing (note 11)	-	-	-	-	4,579	4,098
Selling and general	89	(23)	(4)	(3)	569	499
Federal excise tax and fuel charge	-	-	-	-	1,404	1,290
Depreciation and depletion (note 11)	19	18	-	-	1,432	1,295
Non-service pension and postretirement benefit	32	91	-	-	32	91
Financing (note 5)	31	46	-	-	32	46
Total expenses	171	132	(7,950)	(2,769)	23,106	17,300
Income (loss) before income taxes	(164)	(115)	-	-	2,172	(945)
Income tax expense (benefit)	(38)	(28)	-	-	506	(234)
Net income (loss) (b)	(126)	(87)	-	-	1,666	(711)
Cash flows from (used in) operating activities (b)	15	(58)	-	-	3,844	482
Capital and exploration expenditures (c)	19	33	-	-	699	679
Total assets as at September 30 (b) (note 11)	2,778	1,679	(170)	(245)	40,875	39,382

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(a)	Included export sales to the United States of $4,916 million (2020 - $3,339 million). Export sales to the United States were recorded in all operating segments, with the largest effects in the Upstream segment.

(b)	In the third quarter of 2021, the Downstream segment acquired a portion of Upstream crude inventory for $444 million. There was no earnings impact and t he effects of this transaction have been eliminated for consolidation purposes.

(c)	Capital and exploration expenditures (CAPEX) include exploration expenses, additions to property, plant and equipment, additions to finance leases, additional investments and acquisitions. CAPEX excludes the purchase of carbon emission credits.

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3. Investment and other income

Investment and other income included gains and losses on asset sales as follows:


					Nine Months
	Third Quarter				to September 30
millions of Canadian dollars	2021		2020		2021		2020
Proceeds from asset sales		15		19		57		68
Book value of asset sales		3		8		18		40
Gain (loss) on asset sales, before tax		12		11		39		28
Gain (loss) on asset sales, after tax		10		10		34		25

4. Employee retirement benefits

The components of net benefit cost were as follows:


							Nine Months
	Third Quarter						to September 30
millions of Canadian dollars	2021			2020			2021			2020
Pension benefits:
Current service cost		81			76			243			229
Interest cost		68			77			204			231
Expected return on plan assets		(107	)		(97	)		(321	)		(293	)
Amortization of prior service cost		4			4			12			11
Amortization of actuarial loss (gain)		36			38			108			115
Net periodic benefit cost		82			98			246			293

Other postretirement benefits:
Current service cost		7			6			21			18
Interest cost		6			6			17			18
Amortization of actuarial loss (gain)		4			3			12			9
Net periodic benefit cost		17			15			50			45

5. Financing costs


							Nine Months
	Third Quarter						to September 30
millions of Canadian dollars	2021			2020			2021			2020
Debt-related interest		9			19			50			79
Capitalized interest		(4	)		(9	)		(19	)		(33	)
Net interest expense		5			10			31			46
Other interest		-			-			1			-
Total financing		5			10			32			46

During the second quarter of 2021, the company extended the maturity dates of two of its short-term lines of credit, totalling $750 million, to May 2023 and extended its $300 million committed short-term line of credit to June 2022. The company has not drawn on any of its $1,300 million of available credit facilities.

During the third quarter of 2021, the c

mpany repaid the $75 million, non-interest bearing, revolving demand loan originally issued in 2016 under an arrangement with an affiliate company of ExxonMobil.

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6. Long-term debt


	As at Sept 30		As at Dec 31
millions of Canadian dollars	2021		2020
Long-term debt		4,447		4,447
Finance leases		613		510
Total long-term debt		5,060		4,957

7. Other long-term obligations


	As at Sept 30		As at Dec 31
millions of Canadian dollars	2021		2020
Employee retirement benefits (a)		2,013		2,105
Asset retirement obligations and other environmental liabilities (b)		1,711		1,676
Share-based incentive compensation liabilities		94		45
Operating lease liability (c)		164		95
Other obligations		370		179
Total other long-term obligations		4,352		4,100

(a)	Total recorded employee retirement benefits obligations also included $58 million in current liabilities (2020 - $58 million).

(b)	Total asset retirement obligations and other environmental liabilities also included $100 million in current liabilities (2020 - $100 million).

(c)	Total operating lease liability also included $114 million in current liabilities (2020 - $97 million). In addition to the total operating lease liability, additional undiscounted commitments for leases not yet commenced totalled $1 million (2020 - $27 million).

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8. Financial and derivative instruments

Financial instruments

The fair value of the company’s financial instruments is determined by reference to various market data and other appropriate valuation techniques. There are no material differences between the fair value of the company’s financial instruments and the recorded carrying value. At September 30, 2021 and December 31, 2020, the fair value of long-term debt ($4,447 million, excluding finance lease obligations) was primarily a level 2 measurement.

Derivative instruments

The company’s size, strong capital structure and the complementary nature of the Upstream, Downstream and Chemical businesses reduce the company’s enterprise-wide risk from changes in commodity prices and currency exchange rates. In addition, the company uses commodity-based contracts, including derivative instruments to manage commodity price risk and for trading purposes. Commodity contracts held for trading purposes are presented in the Consolidated statement of income on a net basis in the line “Revenues”. The company does not designate derivative instruments as a hedge for hedge accounting purposes.

Credit risk associated with the company’s derivative position is mitigated by several factors, including the use of derivative clearing exchanges and the quality of and financial l

mits placed on derivative counterparties. The company maintains a system of controls that includes the authorization, reporting and monitoring of derivative activity.

The net notional long/(short) position of derivative instruments was:


(thousands of barrels)	As at Sept 30 2021			As at Dec 31 2020

Crude		(6,410	)		(800	)
Products		(1,070	)		(390	)

Realized and unrealized gain or (loss) on derivative instruments recognized in the Consolidated statement of income is included in the following lines on a before-tax basis:


	Third Quarter					Nine Months to September 30
millions of Canadian dollars	2021			2020		2021			2020
Revenues		(21	)		1		(30	)		(7	)
Purchases of crude oil and products		-			-		(33	)		(18	)
Total		(21	)		1		(63	)		(25	)

Table of Contents

IMPERIAL OIL LIMITED

The estimated fair value of derivative instruments, and the related hierarchy level for the fair value measurement is a

follows:


millions of Canadian dollars At September 30, 2021
	Fair value								Effect of counterparty netting			Effect of collateral netting			Net carrying value
	Level 1		Level 2		Level 3		Total		Effect of counterparty netting			Effect of collateral netting			Net carrying value
Assets


Derivative assets (a)		8		16		-		24		(14	)		-			10

Liabilities
Derivative liabilities (b)		29		7		-		36		(14	)		(21	)		1

(a)	Included in the Consolidated balance sheet line: “Materials, supplies and prepaid expenses” and “Accounts receivable - net”.

(b)	Included in the Consolidated balance sheet line: “Accounts payable and accrued liabilities”.


millions of Canadian dollars At December 31, 2020
	Fair value								Effect of counterparty netting			Effect of collateral netting			Net carrying value
	Level 1		Level 2		Level 3		Total		Effect of counterparty netting			Effect of collateral netting			Net carrying value
Assets
Derivative assets (a)		2		-		-		2		(2	)		-			-

Liabilities
Derivative liabilities (b)		12		-		-		12		(2	)		(10	)		-

(a)	Included in the Consolidated balance sheet line: “Materials, supplies and prepaid expenses” and “Accounts receivable - net”.