Investment in TiO2 Manufacturing Joint Venture

12 Months Ended

Dec. 31, 2016

Equity Method Investments And Joint Ventures [Abstract]

Investment in TiO2 Manufacturing Joint Venture

Note 5 – Investment in TiO₂ manufacturing joint venture:

We own a 50% interest in Louisiana Pigment Company, L.P. (LPC). LPC is a manufacturing joint venture whose other 50%-owner is Huntsman P&A Investments LLC (HPA) (formerly Tioxide Americas LLC). HPA is a subsidiary of Huntsman Corporation. LPC owns and operates a chloride-process TiO₂ plant in Lake Charles, Louisiana.

We and HPA are both required to purchase one-half of the TiO₂ produced by LPC, unless we and HPA agree otherwise (such as in 2015, when we purchased approximately 52% of the production from the plant). LPC operates on a break-even basis and, accordingly, we report no equity in earnings of LPC. Each owner’s acquisition transfer price for its share of the TiO₂ produced is equal to its share of the joint venture’s production costs and interest expense, if any. Our share of net cost is reported as cost of sales as the related TiO₂ acquired from LPC is sold. We report distributions we receive from LPC, which generally relate to excess cash generated by LPC from its non-cash production costs, and contributions we make to LPC, which generally relate to cash required by LPC when it builds working capital, as part of our cash flows from operating activities in our Consolidated Statements of Cash Flows. The components of our net distributions from LPC are shown in the table below.

	Years ended December 31,
	2014			2015			2016
	(In millions)
Distributions from LPC	$	48.0		$	48.2		$	35.0
Contributions to LPC		(37.4	)		(41.7	)		(31.4	)
Net distributions	$	10.6		$	6.5		$	3.6

Summary balance sheets of LPC are shown below:

	December 31,
	2015		2016
	(In millions)
ASSETS
Current assets	$	96.2	$	94.5
Property and equipment, net		110.1		111.6
Total assets	$	206.3	$	206.1

LIABILITIES AND PARTNERS' EQUITY
Other liabilities, primarily current	$	37.8	$	45.2
Partners' equity		168.5		160.9
Total liabilities and partners' equity	$	206.3	$	206.1

Summary income statements of LPC are shown below:

	Years ended December 31,
	2014		2015		2016
	(In millions)
Revenues and other income:
Kronos	$	193.1	$	176.5	$	157.9
HPA		193.8		162.5		157.5
Total revenues and other income		386.9		339.0		315.4

Cost and expenses:
Cost of sales		386.4		338.5		314.9
General and administrative		.5		.5		.5
Total costs and expenses		386.9		339.0		315.4
Net income	$	-	$	-	$	-