Overview

The Beginnings in Ohio

Sunoco got its start on March 27, 1886, when Joseph Newton Pew and Edward O. Emerson, partners in The Peoples Natural Gas Company in Pittsburgh, Pa., made a bold move to diversify their business. Looking to the promising new oil discoveries in Ohio and Pennsylvania, the partners paid $4,500 for two oil leases near Lima, Ohio.

Within a few years the company had acquired pipelines, leases, storage tanks -- and was emerging as one of Ohio's leading suppliers of crude oil. On March 17, 1890, it became The Sun Oil Company of Ohio and was producing, transporting and storing oil as well as refining, shipping and marketing petroleum products. Through the purchase of the Diamond Oil Company in 1894, Sun acquired a refinery in Toledo, Ohio, and began operations there in 1895. The partnership ended in 1899, when Pew bought out Emerson's interest.

In May 1901, the company headed by Pew was incorporated in New Jersey as Sun Company and began securing leases and crude oil in the new Spindletop field in Texas. With business growing, Pew purchased 82 acres in Marcus Hook, Pa., as the site for a second refinery to process crude oil shipped by tanker from Spindletop.

In 1912, the year after Sun Company celebrated its 25th anniversary, Joseph Newton Pew died and was succeeded as President by his son, J. Howard Pew. Another son, Joseph N. Pew, Jr., took over as Vice President.

Years of Innovation

In 1916, the Pew brothers established Sun Shipbuilding and Dry Dock Company, a subsidiary that took the company into the shipbuilding business. In 1920 Sun opened its first service station in Ardmore, Pa., and then another in Toledo, Ohio. The name changed to Sun Oil Company in 1922 to better identify the company with its business. On November 12, 1925, Sun went public -- its stock appearing for the first time on the New York Stock Exchange.

Before the decade was over, Sun was in the oil field equipment business with the 1929 formation of Sperry-Sun, a joint venture with Sperry Gyroscope. One of the most dramatic events of the 1930s for the company -- and the refining industry -- took place when Sun placed on stream the world's first large-scale, commercial catalytic cracking plant in Marcus Hook in 1937.

The mining business attracted Sun in 1941, when Sun formed the Cordero Mining Company in Nevada to supply mercury for Sunoco motor oils. The metal proved vital during the World War II effort. So, too, did Sun Shipbuilding and Dry Dock Company -- which turned out 40 percent of all wartime tankers built or reconverted.

In 1947, J. Howard Pew resigned as President, to be succeeded on March 18 of that year by Robert G. Dunlop. Pew remained a director, and his brother Joseph N. Pew, Jr., was named Chairman of the Board.

Expanding North and South

The Company expanded north and south in the 1950s. In Canada, Sun started a 15,000 barrels per day refinery in Sarnia, Ontario. And, in Venezuela beginning in 1957, Venezuelan Sun Oil Company produced more than one billion barrels of oil from Lake Maracaibo before ceasing operations in 1975 when the Venezuelan government nationalized Sun's holdings.

Back in the States 1958 was the year Sun introduced the Custom Blending Pump, a novel system for dispensing a choice of five octane grades of gasoline from a single pump. It revolutionized the method of marketing gasoline, and a model of the pump is on display at the Smithsonian Institution.

When Joseph N. Pew, Jr., Chairman of the Board, died in 1963, his brother, J. Howard Pew, became Chairman.

A bold venture began for Sun in 1967 in the Athabasca oil sands of Canada, with Sun's Great Canadian Oil Sands Limited subsidiary completing its processing facility in northern Alberta. The plant had the capacity to produce 45,000 barrels per day of synthetic crude oil from the estimated 300 billion barrels of recoverable oil locked in the sands.

Sun Reshapes -- and Later Renames

On October 25, 1968 Sun Oil Company and Sunray DX Oil Company, headquartered in Tulsa, Okla., merged to form a new Sun Oil Company. Having been based in downtown Philadelphia for many years, Sun Oil Company moved to a new headquarters building in St. Davids, Pa., in 1971. That year, on November 17, J. Howard Pew died -- having just celebrated his 70th year with Sun Oil Company.

Major restructuring reshaped the company in 1975, when it organized into fourteen operating units, two property companies and a non-operating parent company, and moved to a major new corporate headquarters in Radnor, Pa. Reflecting the diversification of the company, Sun Oil Company was renamed Sun Company, Inc. in 1976.

A Major Expansion

In a dramatic acquisition in 1980, Sun purchased the U.S. oil and gas properties of Texas Pacific Oil Company, Inc., a subsidiary of The Seagram Company, Ltd., for $2.3 billion. At the time, this was the second largest acquisition in the history of U.S. business. The year before, in 1979, Sun also had taken a wider position in coal by acquiring eastern reserves from Elk River Resources, Inc.

Sun sold Sperry-Sun in 1981 and Sun Ship in 1982. The latter ended the company's 65 years in the shipbuilding business. It was a new look in 1981 when the word SUN in blue block letters on a white sunburst became the identifying symbol of the company. Keeping its familiar Sunoco Diamond and DX symbols at the pump, Sun intensified its marketing push in 1983 with the introduction of Sunoco ULTRA, the highest octane premium unleaded gasoline available from a major U.S. refiner.

The early 1980s brought expansion on a number of fronts. Internationally, Sun signed on to develop interests in the North Sea and offshore China. Domestic reserves were added with the acquisition of Exeter Oil Company, Victory Oil Company and interests of Petro-Lewis Corporation in 1984. The coal business also grew with the acquisition of Whitaker Coal Corporation in Kentucky in 1983. At the same time, responding to the market, Sun began to reduce its lube oil business.

Focus on Refining and Marketing

In 1988 Sun's board approved a major restructuring of the company, disposing of all domestic oil and gas exploration and production through the distribution of Sun Exploration and Production Company, a wholly owned subsidiary, to the common shareholders of Sun Company, Inc., and focusing on the "downstream" part of the business -- refining and marketing.

The renewed focus on refining and marketing began immediately with the acquisition of Atlantic Petroleum Corporation, bringing to Sun another refinery, a network of service stations and a pipeline system. Six years later, the company acquired Chevron's Philadelphia Refinery, immediately adjacent to the former Atlantic facility, and set to work combining the two into a single, more efficient refining complex that was linked directly to the Marcus Hook Refinery, just 12 miles away.

In the early 1990s, the company moved its headquarters from Radnor to downtown Philadelphia and exited the international exploration business. In February 1991 the board elected Robert H. Campbell (formerly an executive vice president with the company) as President and Chief Operating Officer. By the end of 1992, the board elected to the additional positions of Chief Executive Officer and Chairman of the Board.

Sun's strategic direction would now focus on the value added businesses: branded gasoline marketing in the northeastern U.S.; lubricants; chemicals and logistics. Part of that new strategic focus called for divesting Sun's interest in the real estate business, a process that began in 1991, and in Suncor, the Canadian subsidiary, a process that was completed in 1995. Cordero Mining Company was sold in 1993 and Sun's international oil and gas production business was sold in 1996.

Sun's management made a major departure from tradition in 1996 when the board elected John G. (Jack) Drosdick President and Chief Operating Officer. The first Sun President ever to come to that position from outside the company, he had previously been President and COO of Ultramar Corporation and had also served as President and CEO of Tosco Refining Company. Drosdick succeeded Campbell as chairman, CEO and president following Campbell's retirement on May 4, 2000.

The steps taken by Sun in recent years have prepared the company to succeed in a new environment for the petroleum industry, and on November 6, 1998, the company's name was again changed to more clearly reflect its principal business. Having become one of the largest independent U.S. refiner-marketers in the Northeast, Sun Company, Inc. became Sunoco, Inc. became a company with a history that spans half of the American experience.

Expanding Sunoco Chemicals

In 2001, Sunoco took a quantum step in the growth of its chemicals business, acquiring Pittsburgh-based Aristech Chemical Corporation. Included in the purchase were five Aristech chemical plants and a state-of-the-art research center in Pittsburgh. This acquisition not only doubled the size of Sunoco's chemicals business but also enabled Sunoco to become a significant player in the world's chemical markets.

Growing the Business

In March of 2003 Sunoco acquired a 400 million pounds-per-year polypropylene facility from Equistar, and in January 2004, it completed the sale of the plasticizers business to BASF.

In December 2003, Sun Coke began construction of a $140 million coke making facility in Haverhill, Ohio, which will supply 550,000 tons of coke to International Steel Group on an annual basis under a long-term agreement.

In January 2004, Sunoco acquired the Eagle Point refinery in Westville, New Jersey from the El Paso Corporation. The 150,000 barrels-per-day facility increased Sunoco's refining capacity by more than 20 percent, and offers numerous integration advantages with Sunoco's other Delaware Valley refineries.

Recent acquisitions include Coastal and Speedway service stations located throughout the Southeast and sites in Delaware, Maryland, Virginia and Washington D.C. from ConocoPhillips. In addition, Sunoco continues to raise funds for future acquisitions through the sale of certain company-owned retail sites to the distributor channel, generating cash but retaining the gasoline volumes within the Sunoco brand.

Sunoco the Racing Fuel of Choice

Sunoco raised the visibility of its brand significantly in 2004 with a long-term deal to be the Official Fuel of NASCAR. Already the authorized gasoline manufacturer for more than 30 racing series, Sunoco added NASCAR's NEXTEL, Bush, and Craftsman Truck series to that list. The partnership with NASCAR is a crowning achievement for Sunoco's high-quality performance products.

From pipelines to shipping, from refining to marketing, Sunoco has served its shareholders, customers, and employees for well over 120 years.