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Debt and Finance Lease Obligations | 12 Months Ended
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Dec. 31, 2020
Debt and Lease Obligation [Abstract] |
DEBT AND FINANCE LEASE OBLIGATIONS | 10. DEBT AND FINANCE LEASE OBLIGATIONS Debt, at stated values, and finance lease obligations consisted of the following (in millions):
| Final Maturity |  | December 31,
|  | 2020 |  | 2019
Credit facilities: |  |  |  |  |
Valero Revolver | 2024 |  | $ | — |  |  | $ | — |
364-day Revolving Credit Facility | 2021 |  | — |  |  | — |
IEnova Revolver | 2028 |  | 598 |  |  | 348 |
Canadian Revolver | 2021 |  | — |  |  | — |
Accounts receivable sales facility | 2021 |  | — |  |  | 100 |
Public debt: |  |  |  |  |
Valero Senior Notes |  |  |  |  |
6.625% | 2037 |  | 1,500 |  |  | 1,500 |
3.4% | 2026 |  | 1,250 |  |  | 1,250 |
2.85% | 2025 |  | 1,050 |  |  | — |
4.0% | 2029 |  | 1,000 |  |  | 1,000 |
1.2% | 2024 |  | 925 |  |  | — |
2.7% | 2023 |  | 850 |  |  | — |
4.35% | 2028 |  | 750 |  |  | 750 |
7.5% | 2032 |  | 750 |  |  | 750 |
4.9% | 2045 |  | 650 |  |  | 650 |
3.65% | 2025 |  | 600 |  |  | 600 |
2.15% | 2027 |  | 600 |  |  | — |
Floating Rate Notes at 1.3665% | 2023 |  | 575 |  |  | — |
10.5% | 2039 |  | 250 |  |  | 250 |
8.75% | 2030 |  | 200 |  |  | 200 |
7.45% | 2097 |  | 100 |  |  | 100 |
6.75% | 2037 |  | 24 |  |  | 24 |
VLP Senior Notes |  |  |  |  |
4.375% | 2026 |  | 500 |  |  | 500 |
4.5% | 2028 |  | 500 |  |  | 500 |
Gulf Opportunity Zone Revenue Bonds, Series 2010, 4.0% | 2040 |  | 300 |  |  | 300 |
Debenture, 7.65% | 2026 |  | 100 |  |  | 100 |
Other debt | Various |  | 31 |  |  | 47 |
Net unamortized debt issuance costs and other |  |  | (90) |  |  | (88) |
Total debt |  |  | 13,013 |  |  | 8,881 |
Finance lease obligations (see Note 6) |  |  | 1,664 |  |  | 791 |
Total debt and finance lease obligations |  |  | 14,677 |  |  | 9,672 |
Less: Current portion |  |  | 723 |  |  | 494 |
Debt and finance lease obligations, less current portion |  |  | $ | 13,954 |  |  | $ | 9,178 |
Credit Facilities Valero Revolver We have a revolving credit facility (the Valero Revolver) with a borrowing capacity of $4 billion that matures in March 2024. The Valero Revolver also provides for the issuance of letters of credit of up to $2.4 billion. Outstanding borrowings under the Valero Revolver bear interest, at our option, at either (i) the adjusted LIBO rate (as defined in the Valero Revolver) for the applicable interest period in effect from time to time plus the applicable margin or (ii) the alternate base rate (as defined in the Valero Revolver) plus the applicable margin. The Valero Revolver also requires payments for customary fees, including facility fees, letter of credit participation fees, and administrative agent fees. The interest rate and facility fees under the Valero Revolver are subject to adjustment based upon the credit ratings assigned to our senior unsecured debt. We had no borrowings or repayments under the Valero Revolver during the years ended December 31, 2020, 2019, and 2018. 364-day Revolving Credit Facility In April 2020, we entered into an $875 million 364-Day Credit Agreement (the 364-day Revolving Credit Facility) with several lenders. This facility provides for a revolving credit facility in an aggregate principal amount of up to $875 million and matures 364 days from April 13, 2020. Borrowings under this facility bear interest at the base rate or the eurodollar rate (at our election) plus an applicable rate ranging from 0.150 percent to 1.700 percent, based upon the elected interest rate type and our debt ratings from certain rating agencies. The facility requires us to pay a commitment fee accruing on the daily amount of used and unused commitments of the lenders, which is also based upon our debt ratings mentioned above. The interest and commitment fees under this facility are payable quarterly. The facility also requires us to pay a customary agency fee to the administrative agent. The facility contains various customary covenants and events of default. IEnova Revolver Central Mexico Terminals (as described in Note 13) has a combined unsecured revolving credit facility (IEnova Revolver) with IEnova (defined in Note 13) that matures in February 2028. In November 2019, the borrowing capacity under the IEnova Revolver was increased from $340 million to $491 million, and during the year ended December 31, 2020, it was increased to $660 million. IEnova may terminate this revolver at any time and demand repayment of all outstanding amounts; therefore, all outstanding borrowings are reflected in current portion of debt. The IEnova Revolver is available only to the operations of Central Mexico Terminals, and the creditors of Central Mexico Terminals do not have recourse against us. Outstanding borrowings under this revolver bear interest at the three-month LIBO rate for the applicable interest period in effect from time to time plus the applicable margin. The interest rate under this revolver is subject to adjustment, with agreement by both parties, based upon changes in market conditions. As of December 31, 2020 and 2019, the variable rate was 3.870 percent and 5.749 percent, respectively. During the years ended December 31, 2020, 2019, and 2018 Central Mexico Terminals borrowed $250 million, $239 million, and $109 million, respectively, and had no repayments under this revolver. Canadian Revolver In November 2020, one of our Canadian subsidiaries amended its committed revolving credit facility (the Canadian Revolver) of C$150 million to extend the maturity date from November 2020 to November 2021. The Canadian Revolver also provides for the issuance of letters of credit. We had no borrowings or repayments under this revolver during the years ended December 31, 2020, 2019, and 2018. Accounts Receivable Sales Facility We have an accounts receivable sales facility with a group of third-party entities and financial institutions to sell eligible trade receivables on a revolving basis. In July 2020, we extended the maturity date of this facility to July 2021 and decreased the facility amount from $1.3 billion to $1.0 billion. Under this program, one of our marketing subsidiaries (Valero Marketing) sells eligible receivables, without recourse, to another of our subsidiaries (Valero Capital), whereupon the receivables are no longer owned by Valero Marketing. Valero Capital, in turn, sells an undivided percentage ownership interest in the eligible receivables, without recourse, to the third-party entities and financial institutions. To the extent that Valero Capital retains an ownership interest in the receivables it has purchased from Valero Marketing, such interest is included in our financial statements solely as a result of the consolidation of the financial statements of Valero Capital with those of Valero Energy Corporation; the receivables are not available to satisfy the claims of the creditors of Valero Marketing or Valero Energy Corporation. As of December 31, 2020 and 2019, $1.4 billion and $2.2 billion, respectively, of our accounts receivable composed the designated pool of accounts receivable included in the program. All amounts outstanding under the accounts receivable sales facility are reflected as debt on our balance sheets and proceeds and repayments are reflected as cash flows from financing activities on the statements of cash flows. During the year ended December 31, 2020, we sold $300 million of eligible receivables under our accounts receivable sales facility and repaid $400 million. During the year ended December 31, 2019, we sold $900 million of eligible receivables under our accounts receivable sales facility and repaid $900 million. The variable interest rate on the borrowings outstanding under this facility as of December 31, 2019 was 2.3866 percent. During the year ended December 31, 2018, we had no proceeds from or repayments under the accounts receivable sales facility. VLP Revolver As of December 31, 2018, VLP had a $750 million senior unsecured revolving credit facility (the VLP Revolver) with a group of lenders that was scheduled to mature in November 2020. However, on January 10, 2019, in connection with the completion of the Merger Transaction as described in Note 3, the VLP Revolver was terminated. During the year ended December 31, 2018, VLP repaid the outstanding balance of $410 million on the VLP Revolver using proceeds from its public offering of $500 million 4.5 percent Senior Notes as described in “Public Debt” below. Summary of Credit Facilities We had outstanding borrowings, letters of credit issued, and availability under our credit facilities as follows (amounts in millions and currency in U.S. dollars, except as noted):
|  |  |  |  |  | December 31, 2020
|  | Facility Amount |  | Maturity Date |  | Outstanding Borrowings |  | Letters of Credit Issued (a) |  | Availability
Committed facilities: |  |  |  |  |  |  |  |  |  |
Valero Revolver |  | $ | 4,000 |  |  | March 2024 |  | $ | — |  |  | $ | 34 |  |  | $ | 3,966 |
364-day Revolving Credit Facility |  | $ | 875 |  |  | April 2021 |  | $ | — |  |  | n/a |  | $ | 875 |
Canadian Revolver |  | C$ | 150 |  |  | November 2021 |  | C$ | — |  |  | C$ | 5 |  |  | C$ | 145 |
Accounts receivable sales facility (b) |  | $ | 1,000 |  |  | July 2021 |  | $ | — |  |  | n/a |  | $ | 885 |
Letter of credit facility (c) |  | $ | 50 |  |  | November 2021 |  | n/a |  | $ | — |  |  | $ | 50 |
Committed facility of VIE (d): |  |  |  |  |  |  |  |  |  |
IEnova Revolver |  | $ | 660 |  |  | February 2028 |  | $ | 598 |  |  | n/a |  | $ | 62 |
Uncommitted facilities: |  |  |  |  |  |  |  |  |  |
Letter of credit facilities |  | n/a |  | n/a |  | n/a |  | $ | 150 |  |  | n/a
________________________ (a)Letters of credit issued as of December 31, 2020 expire at various times in 2021 through 2023. (b)The available borrowing capacity was lower than the facility amount due to low product prices impacting the amount of eligible receivables. (c)We extended the maturity date of the letter of credit facility from November 2020 to November 2021. (d)Creditors of our VIE do not have recourse against us. We are charged letter of credit issuance fees under our various uncommitted short-term bank credit facilities. These uncommitted credit facilities have no commitment fees or compensating balance requirements. Public Debt During the year ended December 31, 2020, the following activity occurred: •In September 2020, we issued the following senior notes: ◦$575 million of Floating Rate Senior Notes due September 15, 2023 (the Floating Rate Notes), which bear interest at a rate of three-month London Interbank Offered Rate (LIBOR) plus 1.150 percent per annum, subject to certain adjustments set forth in the terms of the Floating Rate Notes; ◦$925 million of 1.200 percent Senior Notes due March 15, 2024; ◦$400 million of 2.850 percent Senior Notes due April 15, 2025 that constitute an additional issuance of our 2.850 percent Senior Notes due April 15, 2025, of which $650 million aggregate principal amount was issued in April 2020; and ◦$600 million of 2.150 percent Senior Notes due September 15, 2027. •In April 2020, we issued $850 million of 2.700 percent Senior Notes due April 15, 2023 and $650 million of 2.850 percent Senior Notes due April 15, 2025. Proceeds from the April and September 2020 debt issuances totaled $4.020 billion before deducting the underwriting discount and other debt issuance costs. During the year ended December 31, 2019, the following activity occurred: •We issued $1 billion of 4.00 percent Senior Notes due April 1, 2029. Proceeds from this debt issuance totaled $992 million before deducting the underwriting discount and other debt issuance costs. The proceeds were used to redeem our 6.125 percent Senior Notes due February 1, 2020 for $871 million, or 102.48 percent of stated value, which includes an early redemption fee of $21 million that is reflected in “other income, net” in our statement of income for the year ended December 31, 2019. •In connection with the completion of the Merger Transaction as described in Note 3, Valero Energy Corporation, the parent company, entered into a guarantee agreement to fully and unconditionally guarantee the prompt payment, when due, of the following debt issued by VLP, one of its wholly owned subsidiaries, that was outstanding upon completion of the Merger Transaction: ◦$500 million of 4.375 percent Senior Notes due December 15, 2026; and ◦$500 million of 4.5 percent Senior Notes due March 15, 2028. Effective March 31, 2020, we early applied the U.S. SEC’s Final Rule Release No. 33-10762, Financial Disclosures About Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize a Registrant’s Securities. This rule allows us to cease providing the previously required condensed consolidating financial information in our periodic reports while the senior notes issued by VLP noted above are outstanding, as VLP’s reporting obligation was suspended on January 22, 2019 in connection with the completion of the Merger Transaction. During the year ended December 31, 2018, the following activity occurred: •We issued $750 million of 4.35 percent Senior Notes due June 1, 2028. Proceeds from this debt issuance totaled $749 million before deducting the underwriting discount and other debt issuance costs. The proceeds were used to redeem our 9.375 percent Senior Notes due March 15, 2019 for $787 million, or 104.9 percent of stated value, which includes an early redemption fee of $37 million that is reflected in “other income, net” in our statement of income for the year ended December 31, 2018. •VLP issued $500 million of 4.5 percent Senior Notes due March 15, 2028. Proceeds from this debt issuance totaled $498 million before deducting the underwriting discount and other debt issuance costs. The proceeds were available only to the operations of VLP and were used to repay the outstanding balance of $410 million on the VLP Revolver and $85 million on its notes payable to us, which is eliminated in consolidation. Other Debt During the year ended December 31, 2018, we retired $137 million of debt assumed in connection with the Peru Acquisition with available cash on hand. Other Disclosures “Interest and debt expense, net of capitalized interest” is comprised as follows (in millions):
| Year Ended December 31,
| 2020 |  | 2019 |  | 2018
Interest and debt expense | $ | 638 |  |  | $ | 544 |  |  | $ | 557 |
Less: Capitalized interest | 75 |  |  | 90 |  |  | 87 |
Interest and debt expense, net of capitalized interest | $ | 563 |  |  | $ | 454 |  |  | $ | 470 |
Our credit facilities and other debt arrangements contain various customary restrictive covenants, including cross-default and cross-acceleration clauses. Principal maturities for our debt obligations as of December 31, 2020 were as follows (in millions):
2021 (a) | $ | 603 |
2022 | 6 |
2023 | 1,445 |
2024 | 925 |
2025 | 1,650 |
Thereafter | 8,474 |
Net unamortized debt issuance costs and other | (90) |
Total debt | $ | 13,013 |
________________________ (a)As of December 31, 2020, our debt obligations due in 2021 include $598 million associated with borrowings under the IEnova Revolver.

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- Definition The entire disclosure for debt and capital lease obligations can be reported. Information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. Also includes descriptions and amounts of capital leasing arrangements that consist of direct financing, sales type and leveraged leases. Disclosure may include the effect on the balance sheet and the income statement resulting from a change in lease classification for leases that at inception would have been classified differently had guidance been in effect at the inception of the original lease. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -URI http://asc.fasb.org/topic&trid=2208923 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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