14. Long-term debt


millions of dollars	As at Dec. 31 2014		As at Dec. 31 2013
Long-term debt (a)		4,746		4,316
Capital leases (b)		167		128
Total long-term debt		4,913		4,444

(a)

Borrowed under an existing agreement with an affiliated company of ExxonMobil that provides for a long-term, variable-rate loan from ExxonMobil to the company of up to $6.25 billion at interest equivalent to Canadian market rates. The agreement is effective until July 31, 2020, cancelable if ExxonMobil provides at least 370 days advance written notice. Average effective rate for the loan was 1.2 percent in 2014.

(b)

Capital leases are primarily associated with transportation facilities and services agreements. The average imputed rate was 7.0 percent in 2014 (2013 – 7.0 percent). Total capitalized lease obligations also include $22 million in current liabilities (2013 - $7 million). Principal payments on capital leases of approximately $19 million per year are due in each of the next four years after December 31, 2015.

In January 2014, the company increased the capacity of its existing floating rate loan facility with an affiliated company of ExxonMobil from $5 billion to $6.25 billion. All other terms and conditions of the agreement remained unchanged.

In the third quarter of 2014, the company extended the maturity date of its existing $500 million stand-by long-term bank credit facility to August 2016. The company has not drawn on the facility.

Subsequent to December 31, 2014 and up to February 11, 2015, the company increased its long-term debt by $490 million by drawing on an existing facility. The increased debt was used to finance normal operations and capital projects.