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Michael CiskowskiThanks, Ashley, and thank you for joining us today. As noted in the release, we reported fourth quarter 2010 income from continuing operations of $180 million or $0.32 per share. This number includes a $36 million after-tax gain or $0.06 per share on the sale of our interest in the Cameron Highway oil pipeline and an after-tax loss of $80 million or $0.14 per share from the mark-to-market impact of positions related to the forward sales of refined products. Excluding those items, our results would've been $0.40 per share. I should note that the loss from discontinued operations shown in the financial tables relates to the Delaware City refinery that was sold in the second quarter of 2010 and the Paulsboro refinery that was sold in the fourth quarter of 2010. The fourth quarter 2010 results from discontinued operations include a non-cash pretax charge of $980 million related to the Paulsboro refinery. Fourth quarter 2010 operating income was $378 million versus an operating loss of $135 million in the fourth quarter of 2009. The $513 million increase in operating income was mainly due to higher margins for diesel and gasoline, plus better discounts for low quality feedstocks, all of which contributed to a 49% increase in refinery throughput margins compared to the fourth quarter of 2009. Looking at the Gulf Coast margins versus WTI, the ULSD margin more than doubled from $6.33 per barrel in the fourth quarter of 2009 to $13.22 per barrel in the fourth quarter of 2010. The Gulf Coast gasoline margin increased nearly 50%, from $3.90 per barrel in the fourth quarter of 2009 to $5.76 per barrel in the fourth quarter of 2010. Looking at the feedstock discounts, the Maya heavy sour crude oil discount to WTI expanded 40% from $6.72 per barrel in the fourth quarter of 2009 to $9.40 per barrel in the fourth quarter of 2010. Another way to look at this is, as a percentage of WTI, so the Maya discount increased from 8.8% of WTI in the fourth quarter of 2009 to 11.1% of WTI in the fourth quarter of '10, which is a 26% improvement year-over-year.
So far in the first quarter of 2011, benchmark margins and heavy sour feedstock discounts versus WTI have been strong for this time of the year. Compared to January 2010, Gulf Coast gasoline margins are up 75%. ULSD margins were up 152% and Maya discounts on an absolute basis are up 8%.I should point out that while margins and heavy sour crude discounts versus WTI have improved from this time last year, WTI has been trading in a discounted range when compared to other lights weak crudes in the medium sour. Our fourth quarter 2010 refinery throughput volume averaged 2.2 million barrels per day, an increase of 205,000 barrels per day or 10% compared to the fourth quarter of 2009. Refinery cash operating expenses in the fourth quarter of '10 were $3.64 per barrel. Cash operating expenses were lower than the third quarter and guidance, primarily due to a decline in energy cost. Our Retail and Ethanol segments also performed well and turned in excellent full year results. U.S. retail had $19 million of operating income in the fourth quarter and $200 million for the year, making it the second-to-best year for our U.S. Retail segment. Read the rest of this transcript for free on seekingalpha.com