Suncor Energy Inc. is a major developer in the oil sands of Northern Alberta. Note 17 to Suncor's financial statements (Exhibit 10-15) describes the company's long-term debt as at December 31, 2009.
In Exhibit 10-15
LONG TERM DEBT AND CREDIT FACILITIES

Required:
a. Suncor has revolving-term debt. Explain in your own words what the major features of this type of debt are.
b. The revolving-term debt bears interest at variable interest rates. What advantages are there for a company to borrow at variable interest rates? How does this affect the risk of investing in Suncor?
c. Suggest possible reasons why the company has borrowed in U.S. dollars. How does this affect the risk of investing in Suncor?
d. The company has not disclosed the minimum cash payments that it must make on its debt over the next five years and a cumulative amount for the years after the fifth year. Why would this type of disclosure be important to users?
e. You would expect that a company in the oil industry would lease some of its facilities and equipment. Does Suncor have any leases? How do you know? What kind of leases are they?
SUNCOR ENERGY INC. 2009 ANNUAL REPORT

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$ millions) Fixed-term debt, redeemable at the option of the company 6.85% Notes, denominated in US dollars, due in 2039 (US$750)(i) 6.80% Notes, denominated in US dollars, due in 2038 (USS900) 6.50% Notes, denominated in US. dollars, due in 2038 (US$1150 5.95% Notes, denominated in US. dollars, due in 2035 (US$600) 5.95% Notes, denominated in US. dollars, due in 2034 (US500) 5.35% Notes, denominated in US. dollars, due in 2033 (USS 300) 7.15% Notes, denominated in US. dollars, due in 2032 (USS 500) 6.10% Notes, denominated in US. dollars, due in 2018 (US$12500 6.05% Notes, denominated in US. dollars, due in 2018 (US$600) 5.00% Notes, denominated in US. dollars, due in 2014 (US$400m 4.00% Notes, denominated in U.S. dollars, due in 2013 (US5300) 7.00% Debentures, denominated in U.S. dollars, due in 2028 (US$250) 7.875% Debentures, denominated in U.S. dollars, due in 2026 (US$275) 9.25% Debentures, denominated in U.S. dollars, due in 2021 (US5300) 5.39% Series 4 Medium Term Notes, due in 2037 5.80% Series 4 Medium Term Notes, due in 2018(iii) 6.70% Series 2 Medium Term Notes, due in 2011 2008 785 972 1 204 918 1 408 612 612 523 1 308 1 531 429 313 325 402 700 500 10 342 Revolving-term debt, with interest at variable rates Commercial paper), bankers acceptances and LIBOR loans (interest rate at December 31, 2009-07%, 2008-22%) 3 244 S millions) Total unsecured long-term debt Secured long-term debt Capital leases Fair value of interest swaps Deferred financing costs 2009 13 586 13 326 18 (63) 13 880 2008 7 815 13 103 25 (72) 7 884 Current portion of long-term debt Capital leasesill (14) Fair value of interest swaps Total current portion of long-term debt Total long-term debt (25) 3 855 (18) 7 866