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Property, Plant, and Equipment

12 Months Ended

Dec. 31, 2019

14. Property, Plant, and Equipment

Balances and changes in PP&E are as follows:


	Weighted average useful life (years)		Balance on 12/31/2018			Additions		Depreciation			Transfer (i)			Write- offs and disposals			Effect of foreign currency exchange rate variation			Oxiteno Andina (*)			Balance on 12/31/2019

Cost:
Land		—		620,879			43,420		—			4,785			(2,017	)		1,059			(261	)		667,865
Buildings		32		1,801,073			18,117		—			105,861			(4,339	)		7,023			(1,789	)		1,925,946
Leasehold improvements		10		1,015,640			19,191		—			129,234			(42,552	)		15			—			1,121,528
Machinery and equipment		13		5,219,256			131,831		—			365,953			(4,967	)		9,596			(13,948	)		5,707,721
Automotive fuel/lubricant distribution equipment and facilities		14		2,864,333			103,288		—			81,038			(57,187	)		—			—			2,991,472
LPG tanks and bottles		10		743,016			65,351		—			(6,993	)		(45,914	)		—			—			755,460
Vehicles		7		308,756			24,686		—			7,564			(20,353	)		(394	)		(98	)		320,161
Furniture and utensils		9		279,016			15,009		—			4,399			(2,665	)		198			(353	)		295,604
Construction in progress		—		922,799			591,525		—			(695,301	)		(108	)		8,344			(173	)		827,086
Advances to suppliers		—		14,088			7,378		—			(8,921	)		—			(1	)		—			12,544
Imports in progress		—		41			9,513		—			(9,304	)		—			—			—			250
IT equipment		5		395,063			21,771		—			872			(5,249	)		352			—			412,809

				14,183,960			1,051,080		—			(20,813	)		(185,351	)		26,192			(16,622	)		15,038,446

Accumulated depreciation:
Buildings				(743,117	)		—		(58,158	)		187			4,681			893			1,679			(793,835	)
Leasehold improvements				(558,042	)		—		(84,664	)		2,040			26,291			(4	)		—			(614,379	)
Machinery and equipment				(2,969,209	)		—		(298,767	)		2,983			3,510			16,340			13,516			(3,231,627	)
Automotive fuel/lubricant distribution equipment and facilities				(1,657,608	)		—		(159,961	)		—			50,691			—			—			(1,766,878	)
LPG tanks and bottles				(401,056	)		—		(57,890	)		4,467			28,925			—			—			(425,554	)
Vehicles				(123,650	)		—		(27,106	)		28			11,274			311			98			(139,045	)
Furniture and utensils				(155,339	)		—		(18,944	)		(12	)		2,280			204			336			(171,475	)
IT equipment				(288,083	)		—		(34,782	)		50			5,061			(309	)		—			(318,063	)

				(6,896,104	)		—		(740,272	)		9,743			132,713			17,435			15,629			(7,460,856	)


	Balance on 12/31/2018			Additions			Depreciation			Transfer (i)			Write- offs and disposals			Effect of foreign currency exchange rate variation		Oxiteno Andina (*)		Balance on 12/31/2019
Provision for losses:
Advances to suppliers		(83	)		(27	)		—			—			—			—		—		(110	)
Buildings		(306	)					—			—			—			—		306		0
Land		(827	)		—			—			—			—			—		681		(146	)
Leasehold improvements		(1,385	)		(1,528	)		—			—			111			1,203		—		(1,599	)
Machinery and equipment		(6,117	)		—			—			—			769			1,138		1,335		(2,875	)
Automotive fuel/lubricant distribution equipment and facilities		(165	)		—			—			—			67			—		—		(98	)
Construction in progress		(38	)		—			—			—			—			—		38		0
Furniture and utensils		(70	)		—			—			—			1			—		69		0

		(8,991	)		(1,555	)		—			—			948			2,341		2,429		(4,828	)

Net amount		7,278,865			1,049,525			(740,272	)		(11,070	)		(51,690	)		45,968		1,436		7,572,762

(*) Refers to the asset write-offs of Oxiteno Andina (see Note 3.b.3).


	Weighted average useful life (years)		Balance on 12/31/2017		Additions		Depreciation		Transfer (i)			Write-offs and disposals			Effect of foreign currency exchange rate			Balance acquisition TEAS (ii)		Balance on 12/31/2018
Cost:
Land		—		576,642		3,994		—		9,261			(895	)		(1,238	)		33,115		620,879
Buildings		32		1,637,871		7,041		—		151,937			(2,929	)		(10,914	)		18,067		1,801,073
Leasehold improvements		8		912,555		11,931		—		103,371			(12,273	)		56			—		1,015,640
Machinery and equipment		13		4,721,931		115,171		—		588,696			(4,895	)		(261,955	)		60,308		5,219,256
Automotive fuel/lubricant distribution equipment and facilities		13		2,729,522		98,478		—		98,573			(62,240	)		—			—		2,864,333
LPG tanks and bottles		8		692,856		78,995		—		2,552			(31,387	)		—			—		743,016
Vehicles		6		287,295		29,141		—		18,061			(23,996	)		(1,745	)		—		308,756
Furniture and utensils		8		265,909		18,417		—		6,078			(863	)		(10,570	)		45		279,016
Construction in progress		—		929,000		796,909		—		(883,994	)		(578	)		81,462			—		922,799
Advances to suppliers		—		112,167		6,317		—		(100,233	)		—			(4,163	)		—		14,088
Imports in progress		—		786		699		—		(1,446	)		—			2			—		41
IT equipment		5		352,986		34,921		—		7,942			(1,953	)		1,161			6		395,063

				13,219,520		1,202,014		—		798			(142,009	)		(207,904	)		111,541		14,183,960


	Weighted average useful life (years)	Balance on 12/31/2017			Additions			Depreciation			Transfer (i)			Write- offs and disposals			Effect of foreign currency exchange rate variation			Balance acquisition TEAS (ii)			Balance on 12/31/2018
Accumulated depreciation:
Buildings			(724,408	)		—			(53,462	)		10,046			2,608			26,533			(4,434	)		(743,117	)
Leasehold improvements			(475,651	)		—			(83,208	)		(4,574	)		5,398			(7	)		—			(558,042	)
Machinery and equipment			(2,980,166	)		—			(271,867	)		1,143			3,449			288,461			(10,229	)		(2,969,209	)
Automotive fuel/lubricant distribution equipment and facilities			(1,545,806	)		—			(162,815	)		(7,232	)		58,245			—			—			(1,657,608	)
LPG tanks and bottles			(328,384	)		—			(88,308	)		(2,347	)		17,983			—			—			(401,056	)
Vehicles			(112,200	)		—			(28,792	)		498			15,002			1,842			—			(123,650	)
Furniture and utensils			(148,575	)		—			(18,482	)		(292	)		513			11,517			(20	)		(155,339	)
IT equipment			(260,859	)		—			(30,659	)		2,702			1,819			(1,080	)		(6	)		(288,083	)

			(6,576,049	)		—			(737,593	)		(56	)		105,017			327,266			(14,689	)		(6,896,104	)

Provision for losses:
Advances to suppliers			(83	)		—			—			—			—			—			—			(83	)
Buildings			—			(306	) (*)		—			—			—			—			—			(306	)
Land			(104	)		(723	) (*)		—			—			—			—			—			(827	)
Leasehold improvements			(564	)		(733	)		—			—			2			(90	)		—			(1,385	)
Machinery and equipment			(4,724	)		(1,532	) (*)		—			—			444			(305	)		—			(6,117	)
Automotive fuel/lubricant distribution equipment and facilities			(169	)		—			—			—			4			—			—			(165	)
Construction in progress			—			(38	) (*)		—			—			—			—			—			(38	)
Furniture and utensils			(1	)		(69	) (*)		—			—			—			—			—			(70	)

			(5,645	)		(3,401	)		—			—			450			(395	)		—			(8,991	)

Net amount			6,637,826			1,198,613			(737,593	)		742			(36,542	)		118,967			96,852			7,278,865

(i) Refers to amounts transferred to intangible assets, inventories and right to use assets as from 2019.

(ii) See Note 3.c.


	Weighted average useful life (years)		Balance on 1/1/2017			Additions		Depreciation			Transfer (i)			Write-offs and disposals			Effect of foreign currency exchange rate variation			Opening balance CBLSA			Balance on 12/31/2017
Cost:
Land		—		520,575			4,319		—			16,039			(969	)		4,574			32,104			576,642
Buildings		30		1,440,204			10,677		—			95,630			(12,409	)		32,998			70,771			1,637,871
Leasehold improvements		9		796,521			13,819		—			116,698			(14,494	)		11			—			912,555
Machinery and equipment		12		4,225,056			130,154		—			105,060			(16,069	)		277,730			—			4,721,931
Automotive fuel/lubricant distribution equipment and facilities		13		2,429,079			131,134		—			78,568			(29,935	)		—			120,676			2,729,522
LPG tanks and bottles		11		631,978			96,290		—			(1,149	)		(34,263	)		—			—			692,856
Vehicles		7		271,133			28,428		—			6,948			(21,055	)		1,841			—			287,295
Furniture and utensils		9		204,550			35,078		—			10,775			(834	)		10,756			5,584			265,909
Construction in progress		—		523,285			766,775		—			(386,198	)		(4	)		10,192			14,950			929,000
Advances to suppliers		—		96,423			61,536		—			(48,722	)		—			2,930			—			112,167
Imports in progress		—		58			1,182		—			(450	)		—			(4	)		—			786
IT equipment		5		288,705			42,638		—			3,095			(1,081	)		170			19,495			352,986

				11,427,567			1,322,030		—			(3,706	)		(131,113	)		341,198			263,544			13,219,520

Accumulated depreciation:
Buildings				(632,908	)		—		(46,795	)		130			5,535			(28,365	)		(22,005	)		(724,408	)
Leasehold improvements				(412,449	)		—		(71,660	)		(166	)		8,624			—			—			(475,651	)
Machinery and equipment				(2,474,504	)		—		(258,068	)		(139	)		10,174			(257,629	)		—			(2,980,166	)
Automotive fuel/lubricant distribution equipment and facilities				(1,383,069	)		—		(144,884	)		(29	)		26,907			—			(44,731	)		(1,545,806	)
LPG tanks and bottles				(280,445	)		—		(64,226	)		130			16,157			—			—			(328,384	)
Vehicles				(101,082	)		—		(21,740	)		80			12,365			(1,823	)		—			(112,200	)
Furniture and utensils				(120,747	)		—		(15,128	)		(9	)		594			(9,275	)		(4,010	)		(148,575	)
IT equipment				(220,421	)		—		(24,481	)		148			991			(121	)		(16,975	)		(260,859	)

				(5,625,625	)		—		(646,982	)		145			81,347			(297,213	)		(87,721	)		(6,576,049	)


	Balance on 1/1/2017			Additions			Depreciation			Transfer (i)			Write-offs and disposals			Effect of foreign currency exchange rate variation			Opening balance CBLSA		Balance on 12/31/2017
Provision for losses:
Advances to suppliers		(83	)		—			—			—			—			—			—		(83	)
Land		(197	)		(104	)		—			—			197			—			—		(104	)
Leasehold improvements		(560	)		(10	)		—			—			14			(8	)		—		(564	)
Machinery and equipment		(4,347	)		(397	)		—			—			45			(25	)		—		(4,724	)
Automotive fuel/lubricant distribution equipment and facilities		(336	)		—			—			—			167			—			—		(169	)
Furniture and utensils		(1	)		—			—			—			—			—			—		(1	)

		(5,524	)		(511	)		—			—			423			(33	)		—		(5,645	)

Net amount		5,796,418			1,321,519			(646,982	)		(3,561	)		(49,343	)		43,952			175,823		6,637,826

Construction in progress relates substantially to expansions, renovations, constructions and upgrade of industrial facilities, terminals, stores, service stations and distribution bases.

Advances to suppliers is related, basically, to manufacturing of assets for expansion of plants, terminals, stores, service stations and bases and acquisition of real estate.

The depreciation expenses were recognized in the financial statements as shown below:


	2019		2018		2017
Inventories and cost of products and services sold		405,966		406,002		364,826
Selling and marketing		285,671		279,023		248,112
General and administrative		48,635		52,568		34,044

		740,272		737,593		646,982