Exhibit 12.1
| Six Months Ended |
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|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30, | Years Ended December 31, | |||||||||||||||||||
| 2004 | 2003 | 2002 | 2001 | 2000 | 1999 | |||||||||||||||
| Earnings: | ||||||||||||||||||||
| Income from continuing operations | ||||||||||||||||||||
| before provision for income taxes and | ||||||||||||||||||||
| income from equity investees | $ | 38,946 | $ | 67,177 | $ | 52,350 | $ | 42,694 | $ | 35,968 | $ | 65,445 | ||||||||
| Add: | ||||||||||||||||||||
| Fixed charges | 10,507 | 16,443 | 5,492 | 4,203 | 5,266 | 997 | ||||||||||||||
| Amortization of capitalized | ||||||||||||||||||||
| interest | 28 | 55 | 48 | 39 | 34 | 32 | ||||||||||||||
| Distributions from Skelly-Belvieu | ||||||||||||||||||||
| Pipeline Company | 975 | 2,803 | 3,590 | 2,874 | 4,658 | 4,238 | ||||||||||||||
| Less: Interest capitalized | (28 | ) | (123 | ) | (255 | ) | (298 | ) | - | (115 | ) | |||||||||
| Total earnings | $ | 50,428 | $ | 86,355 | $ | 61,225 | $ | 49,512 | $ | 45,926 | $ | 70,597 | ||||||||
| Fixed charges: | ||||||||||||||||||||
| Interest expense (1) | $ | 10,082 | $ | 15,291 | $ | 4,968 | $ | 3,721 | $ | 5,181 | $ | 777 | ||||||||
| Amortization of debt issuance costs | 201 | 740 | 160 | 90 | - | - | ||||||||||||||
| Interest capitalized | 28 | 123 | 255 | 298 | - | 115 | ||||||||||||||
| Rental expense interest factor (2) | 196 | 289 | 109 | 94 | 85 | 105 | ||||||||||||||
| Total fixed charges | $ | 10,507 | $ | 16,443 | $ | 5,492 | $ | 4,203 | $ | 5,266 | $ | 997 | ||||||||
| Ratio of earnings to fixed charges | 4.8x | 5.3x | 11.1x | 11.8x | 8.7x | 70.8x | ||||||||||||||
| (1) | The “interest expense, net” reported in Valero L.P.‘s consolidated statements of income for the six months ended June 30, 2004 and the years ended December 31, 2003 and 2002 includes investment income of $86,000, $171,000 and $248,000, respectively. |
| (2) | The interest portion of rental expense represents one-third of rents, which is deemed representative of the interest portion of rental expense. |