6. INVENTORIES 7. REFINING JOINT VENTURE Inventories at December 31 are as follows: The Corporation has an investment in HOVENSA L.L.C., a 50% joint venture with Petroleos de Venezuela, S.A. (PDVSA). HOVENSA owns and operates a refinery in the Vir- gin Islands, previously wholly-owned by the Corporation. The Corporation accounts for its investment in HOVENSA using the equity method. Summarized financial information for HOVENSA as of December 31, 2003, 2002 and 2001 and for the years then ended follows: * The CorporationGLYPH<213>s share of HOVENSAGLYPH<213>s income was $117 million in 2003 and $58 million in 2001. The CorporationGLYPH<213>s share of the 2002 loss was $47 million. The CorporationGLYPH<213>s share of HOVENSAGLYPH<213>s undistributed income aggregated $240 million at December 31, 2003. The Corporation has agreed to purchase 50% of HOVENSA’s production of refined products at market During 2003, the Corporation recorded non-cash additions to fixed assets of $1,340 million. Of this total, $485 million related to assets that were previously accounted for as an equity investment in a company that holds natural gas prices, after sales by HOVENSA to unaffiliated parties. Such purchases amounted to approximately $2,040 million during 2003, $1,280 million during 2002 and $1,500 million during 2001. The Corporation sold crude oil to HOVENSA for approximately $410 million during 2003, $80 million during 2002 and $110 million during 2001. In addition, the Corporation billed HOVENSA freight charter costs of $59 million during 2003, $20 million during 2002 and $55 million during 2001. The Corporation guarantees the payment of up to 50% of the value of HOVENSA’s crude oil purchases from suppliers other than PDVSA. At December 31, 2003, this amount was $134 million. This amount fluctuates based on the volume of crude oil purchased and the related crude oil prices. In addi- tion, the Corporation has agreed to provide funding to the extent HOVENSA does not have funds to meet its senior debt obligations up to a maximum of $40 million. At formation of the joint venture, PDVSA V.I., a wholly- owned subsidiary of PDVSA, purchased a 50% interest in the fixed assets of the Corporation’s Virgin Islands refinery for $62.5 million in cash and a 10-year note from PDVSA V.I. for $562.5 million bearing interest at 8.46% per annum and requiring principal payments over its term. At December 31, 2003 and December 31, 2002, the principal balance of the note was $334 million and $395 million, respectively. Property, plant and equipment at December 31 consists of the following: 8. PROPERTY, PLANT AND EQUIPMENT Millions of dollars 2003 2002 Crude oil and other charge stocks $ 138 $9 Refined and other finished products 567 497 Less: LIFO adjustment (293 ) (261) 412 335 Materials and supplies 167 157 Total $ 579 $ 492 Millions of dollars 2003 2002 2001 Summarized Balance Sheet At December 31 Cash and cash equivalents $ 341 $ 11 $ 25 Other current assets 541 509 466 Net fixed assets 1,818 1,895 1,846 Other assets 37 40 35 Current liabilities (441) (335) (294) Long-term debt (392) (467) (365) Deferred liabilities  and credits (56) (45) (23) Partners’ equity $1,848 $ 1,608 $ 1,690 Summarized Income Statement For the years ended December 31 Total revenues $5,451 $ 3,783 $ 4,209 Costs and expenses (5,212) (3,872) (4,089) Net income (loss)* $ 239 $ (89) $ 120 Millions of dollars 2003 2002 Exploration and production Unproved properties $ 950 $ 1,020 Proved properties 2,634 2,843 Wells, equipment and related facilities 11,030 10,836 Refining and marketing 1,486 1,450 Total — at cost 16,100 16,149 Less reserves for depreciation, depletion,  amortization and lease impairment 8,122 9,117 Property, plant and equipment, net $ 7,978 $ 7,032 46