The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Energy sector dominated this year for the first time since 2008, with 28 companies featured on the list.

100 Fastest-Growing Companies

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are mining, oil and gas exploration and services, pipelines, refining, and utilities.

Fortune Sector Leaders: Energy

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

G500-2023-Marathon Petroleum

Oil and gas refiner Marathon Petroleum brought in $180 billion in revenue, a 27% increase from the previous year. The company made $14.5 billion in profits, an increase of almost 50%. 
<ul> 
 	<li>Marathon returned 86.5% to shareholders in 2022, making it the sixth-best-performing stock on the U.S. Fortune 500 for the year.</li> 
 	<li>In April 2023, Tesoro Refining and Marketing, which was acquired by Marathon Petroleum in 2018, paid a $27.5 million settlement for violating a court order to reduce pollution at its facility in Martinez, Calif.</li> 
</ul>

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500 2023-Marathon Petroleum

Oil and gas refiner Marathon Petroleum jumped three spots on this year’s list, bringing in $180 billion in revenue, a 27% increase from the previous year. The company made $14.5 billion in profits, an increase of almost 50%. 
<ul> 
 	<li>Marathon returned 86.5% to shareholders in 2022, making it the sixth-best-performing stock on the Fortune 500 for the year.</li> 
 	<li>In April 2023, Tesoro Refining and Marketing, which was acquired by Marathon Petroleum in 2018, paid a $27.5 million settlement for violating a court order to reduce pollution at its facility in Martinez, Calif.</li> 
</ul>

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

G500 2022-49-Marathon Oil

Like most energy companies, independent refiner Marathon Petroleum took a big hit from declining oil and gas prices at the start of the pandemic—and saw its fortunes rebound in 2021, climbing from No. 81 to No. 49 on this year’s Global 500. The company also sold gas-station and convenience-store chain Speedway to 7-Eleven for $21 billion in May 2021. Russia’s invasion of Ukraine created new challenges for Marathon in 2022: Prior to the invasion, Marathon was a major purchaser of Russian oil. Owing to sanctions against Russian products, the company has started looking for alternative suppliers; in particular, it has begun turning to Ecuador as a source of crude.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022 Marathon Petroleum

Like most energy companies, independent refiner Marathon Petroleum took a big hit from declining oil and gas prices at the start of the pandemic—and saw its fortunes rebound in 2021, climbing from No. 32 to No. 19 on this year’s Fortune 500. The company also sold gas-station and convenience-store chain Speedway to 7-Eleven for $21 billion in May 2021. Russia’s invasion of Ukraine created new challenges for Marathon in 2022: Prior to the invasion, Marathon was a major purchaser of Russian oil. Owing to sanctions against Russian products, the company has started looking for alternative suppliers; in particular, it has begun turning to Ecuador as a source of crude.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500-2021-081-Marathon Petroleum

The country’s largest independent refiner wasn’t spared the ravages of COVID-19. Major disruptions to the transport fuels business saddled Marathon with a $9.8 billion loss in profits in 2020. To consolidate, the company announced it would sell its Speedway retail operations to 7-Eleven for $21 billion. The company also began widespread job cuts shortly after it announced in August the permanent closure of two refineries in New Mexico and California. Adding to its challenges, a devastating winter storm in Texas delayed the company’s 2020 results.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-32-Marathon Petroleum

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-048-Marathon-Petroleum

While much of the energy sector struggled with faltering oil prices, the U.S.’s largest independent refiner eked out gains by processing crude into industrial products.That pushed up revenue 28.5% in 2019 even as net income remained flat. Still, the Ohio-based business had a tumultuous year. It purchased Andeavor, a move that expanded its reach as a refiner, but failed to live up to Marathon's expectations. Activist investors, meanwhile, renewed demands for a management shakeup. They also pushed for a review of the company's pipeline and storage operations, as well as the planned spin-off of its retail Speedway business.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-022-Marathon-Refinery

While much of the energy sector struggled with faltering oil prices, the U.S.’s largest independent refiner eked out gains by processing crude into industrial products.That pushed up revenue 28.4% in 2019 even as net income remained flat. Still, the Ohio-based business had a tumultuous year. It purchased Andeavor, a move that expanded its reach as a refiner, but failed to live up to Marathon's expectations. Activist investors, meanwhile, renewed demands for a management shakeup. They also pushed for a review of the company's pipeline and storage operations, as well as the planned spin-off of its retail Speedway business. Amid the turmoil, the company’s long-time CEO plans to retire this year.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune Global 500 generated $27.6 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 62nd running of the list.

The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Marathon Petroleum is a petroleum and energy refining, processing, and marketing company. Until 2011, it was a fully owned subsidiary of Marathon Oil. MPC operates the largest petroleum refining system in the U.S. as of 2026. The marketing arm includes Marathon-branded retail outlets—gas stations offering Marathon gasoline, plus car washing services and convenience store items. In addition to its refining and fuel businesses, the company makes ingredients for household items such as carpeting and PVC pipes. Through a partnership with MPLX, Marathon Petroleum provides fuel logistics and distribution services.

Q2 2026

Q1 2026

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Marathon Petroleum (MPC): Company Profile, Stock Price, News, Rankings

legacy

Marathon Petroleum

marathon petroleum

Welcome to the MPC First Quarter twenty twenty five Earnings Call. My name is Amanda, and I will be your operator for today's call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. Please note that this conference is being recorded.

I will now turn the call over to Christina Kazzarian. Christina, you may begin.

Welcome to Marathon Petroleum Corporation's first quarter twenty twenty five earnings conference call. The slides that accompany this call can be found on our website at marathonpetroleum.com under the Investor tab. Joining me on the call today are Mary Anne Mannen, CEO John Quaid, CFO and other members of the executive team. We invite you to read the Safe Harbor statements on Slide two. We will be making forward looking statements today.

Actual results may differ. Factors that could cause actual results to differ are included there as well as in our filings with the SEC. With that, I'll turn the call over to Mary Anne.

Thanks, Christina, and good morning, everyone. Let me highlight a few elements of our performance that were most relevant to our results in the first quarter. Refining utilization of 89%, reflecting the safe and successful completion of the second highest amount of planned turnarounds in history focused heavily on our Gulf Coast region. We planned this turnaround activity to occur in the first quarter, a period of seasonally weaker demand. Capture was 104 as we delivered strong commercial performance in a period of low refining margins and volatility from regulatory uncertainty.

Our Midstream segment adjusted EBITDA grew 8% year over year and MPLX announced over $1,000,000,000 of strategic acquisitions advancing our Midstream natural gas and NGL growth strategies. Our longer term fundamental view supports an enhanced mid cycle environment for refining. Despite reductions to the 2025 demand outlook forecasts still point to a global oil demand growth mainly driven by demand for the refined products we produce. U. S.

Refined product inventories have drawn for the ninth straight week and are below the five year average. This plus lower retail prices should be supportive as we move into the summer driving season, a period of strong seasonal demand. Within our own domestic and export businesses, we are seeing steady year over year demand for gasoline and growth for diesel and jet fuel. And while light heavy differentials could remain narrow as Canadian producers increase maintenance in the second quarter, we believe that higher OPEC plus production could offset that near term tightness. We believe underlying fundamentals support stronger margins especially as announced refinery closures offset recent capacity additions.

We anticipate around 800,000 barrels per day coming offline across several refineries in The U. S. And Europe this year. In The U. S, the Gulf Coast refinery completed its closure in the first quarter and in California two announced closures are expected over the next twelve months.

We have been investing in our fully integrated West Coast value chain. California demand for our products is driven by the 28,000,000 conventional fuel vehicles in the state among other factors. And with nearly 8,000,000 in Los Angeles, the LA region is one of the three largest refined product demand centers in The U. S. At our Los Angeles refinery, we are nearing completion of approximately $700,000,000 in infrastructure improvements to integrate and modernize utility systems to improve reliability and increase energy efficiency while also complying with tighter emission reduction regulations.

Following completion expected at the end of this year, these improvements are intended to strengthen the competitiveness of our Los Angeles refinery and position us to be one of the most cost competitive players in the region for years to come. Our long term positive fundamental view for the refining industry is unchanged and we expect demand growth to exceed the net impact of capacity additions and rationalization through the end of the decade. We believe The U. S. Refining industry will remain structurally advantaged over the rest of the world.

The U. S. Has a locational advantage given the accessibility of nearby crude, which we believe will grow as the cost of transportation increases. The availability of low cost natural gas, low cost butane and The U. S.

Refining systems flexibility all increase its competitive advantage over international sources of supply. The flexibility of our refining assets and our domestic and international logistical and commercial capabilities further increase our global competitive advantage. Our commitment to commercial excellence regardless of market conditions remains core to our execution. We believe that the capabilities we are building provide a sustainable advantage versus our peers. We look to demonstrate that through our financial performance.

We are progressing our $1,250,000,000 standalone capital plan for 2025 with 70% targeted on high return projects designed to create optionality and improve our ability to capitalize on market volatility. Underpinning our commitment to safe and reliable operations, maintenance capital is approximately 30% of that capital spend. In addition to the project at our LAR refinery in our Mid Con region, we are increasing our flexibility to optimize jet production at our Robinson refinery to meet growing demand with completion expected by year end 2026. On The Gulf Coast, we are constructing a distillate hydrotreater at our Galveston Bay refinery to produce higher value ultra low sulfur diesel with completion expected by year end 2027. In addition to these multi year projects, we are executing smaller high return quick hit projects targeted at enhancing refinery yields, improving energy efficiency and lowering our cost.

Leveraging our fully integrated refining system and geographic diversification across the Gulf Coast Mid Con and West Coast regions, we are well positioned to deliver peer leading through cycle cash generation. In our midstream business, we've announced over $1,000,000,000 of strategic acquisitions since the start of

year. First, within its NGL value chain MPLX will be acquiring the remaining 55% interest in the BANGL NGL pipeline. Full ownership of BANGL and its expansion opportunities enhance MPLX's Permian platform as we connect growing NGL production from the wellhead to our recently announced Gulf Coast fractionation facilities. The BANGL transaction is anticipated to close in July subject to the satisfaction of closing conditions. Second, MPLX expanded its crude oil value chain by acquiring gathering businesses from Whiptail Midstream in March.

The San Juan Basin assets in the 4 Corners region enhances supply to our refining system. Third, within its natural gas value chain, MPLX has entered into an agreement to double its stake in the Matterhorn Express natural gas pipeline from 5% to 10%. The transaction is expected to close in the second quarter of twenty twenty five subject to the satisfaction of closing conditions. These acquisitions are expected to be immediately accretive. We're all well aware of the volatility in the commodity markets.

However, based on feedback from our producer customers, we continue to expect year over year growth across our Marcellus, Utica and Permian operating regions. These basins have some of the lowest breakeven prices in The U. S, offering economically advantaged development opportunities. We believe MPLX is well positioned and has significant opportunities to support the development plans of its producer customers, especially as demand increases for natural gas powered electricity. MPLX's financial flexibility places it in an excellent position to continue to significantly grow its distributions, further enhancing the value of its strategic relationship with MPC.

Given our highly advantaged refining business and the $2,500,000,000 annualized distribution from MPLX, we believe we can lead peers in capital returns through all parts of the cycle. Now I'll hand it over to John to discuss our financial performance.

Thanks Mary Anne. Moving to first quarter highlights, slide four provides a summary of our financial results. This morning we reported a first quarter net loss of $0.24 per share. During the quarter, we returned over $1,300,000,000 to shareholders through dividends and repurchases. Slide five shows the sequential change in adjusted EBITDA from fourth quarter twenty twenty four to first quarter twenty twenty five and the reconciliation between adjusted EBITDA and our net results for the quarter.

Adjusted EBITDA for the quarter was approximately $2,000,000,000 lower sequentially by $145,000,000 due to decreased results in our refining and marketing and renewable diesel segments. In addition to effects from the mix of pre tax earnings between our R and M and midstream businesses, our tax rate was further lowered by discrete tax benefits recognized in the quarter. Moving to our refining and marketing first quarter segment results on slide six, our refineries ran at 89% utilization processing 2,600,000 barrels of crude per day. We completed significant planned turnaround activity in the quarter particularly in our Gulf Coast region where utilization decreased from 97% in the fourth quarter of last year to 82% in the first quarter. As compared to fourth quarter of last year, the effects of lower Gulf Coast volumes were partially offset by higher margins in the Mid Con and the West Coast.

R And M segment adjusted EBITDA was $1.91 per barrel for the quarter. Turning to slide seven, first quarter capture of 104% was driven by solid commercial execution as well as seasonally strong clean product tailwinds. We leveraged the scale of our fully integrated system across all three regions to capture margin opportunities across our entire value chain from feedstocks to products. Slide eight shows our Midstream segment performance for the quarter. Our Midstream segment continues to deliver cash flow growth with an 8% year over year increase in quarterly segment adjusted EBITDA.

And in the first quarter MPC received $619,000,000 of distributions from MPLX, a 12.5% increase compared to the $550,000,000 received in the first quarter of twenty twenty four. MPLX remains a source of durable growth as it progresses its mid single digit adjusted EBITDA growth strategy. Slide nine shows our renewable diesel segment performance for the quarter and what was a challenging environment. Our renewable diesel facilities ran at 70% utilization mainly as a result of unplanned downtime at both facilities. As compared to last year's fourth quarter, the segment's largest headwind was changes in regulatory credits, which reduced margins across the industry.

As we look forward, based on the latest guidance, we have already taken actions we expect will allow us to realize incremental 45Z credits starting at the beginning of the second quarter and we will continue to pursue value for the 45Z credits we were unable to recognize in the first quarter. That said, we're focused on what we can control. At our Martinez joint venture facility, one of the most competitive renewable diesel operations in The U. S, we are optimizing the renewable refinery to its nameplate capacity, leveraging flexible logistics and pretreatment capabilities to enable a diverse slate and margin. We have addressed the operational items that limited production in the first quarter and following some planned downtime at our Dickinson Refinery in April, both our renewable refineries are positioned to run-in the second quarter.

Slide 10 presents the elements of change in our consolidated cash position for the first quarter. Operating cash flow excluding changes in working capital was $1,000,000,000 for the quarter driven by the strength and growth of our midstream business. Working capital was a $1,100,000,000 use of cash for the quarter primarily driven by inventory builds mostly in our Gulf Coast region. Crude and product inventory builds related to planned turnarounds here in the first and second quarters as well as product builds related to in transit export shipments. In the second quarter, we expect some but maybe not all of this inventory build will reverse as turnarounds are completed and inventory is drawn to normal operating levels.

First quarter capital expenditures and investments were $795,000,000 and MPLX completed the acquisition of a gathering business from Whiptail Midstream for $237,000,000 In the quarter, MPC issued $2,000,000,000 in senior notes and this issuance was intended to replace the $750,000,000 of senior notes that matured in September of last year as well as refinance the $1,250,000,000 of senior notes that matured on May 1. MPLX repaid $500,000,000 of maturing debt in February and also issued $2,000,000,000 of senior notes. MPLX used a portion of the proceeds to retire 1,200,000,000 of senior notes scheduled to mature in June. At the end of the quarter, MPC had approximately $3,800,000,000 in consolidated cash including MPC cash of $1,300,000,000 and MPLX cash of $2,500,000,000 We continue to manage our balance sheet to an investment grade credit profile. We remain comfortable with our minimum target of about $1,000,000,000 of cash on the balance sheet being sufficient to run the business and this is supported by the $2,500,000,000 and growing annual distribution from MPLX as well as our undrawn credit facilities of $5,000,000,000 all positioning us to have ample liquidity to endure market fluctuations.

Turning to guidance on Slide 11, we provide our second quarter outlook. With major plant turnaround activity behind us, we are ready to run to meet increasing seasonal demand. We're projecting throughput volumes of 2,800,000 barrels per day representing utilization of 94%. Turnaround expense is projected to be approximately $265,000,000 in the second quarter with activity mainly focused in the Mid Con and West Coast regions. For the full year, turnaround expenses are expected to be similar to last year at around $1,400,000,000 Operating costs are projected to be $5.3 per barrel in the second quarter.

Distribution costs are expected to be approximately $1,500,000,000 Corporate costs are expected to be $220,000,000 With that, let me pass it back to Mary Anne.

Thanks John. We are unwavering in our commitment to safe and reliable operations, Operational excellence, commercial execution and our cost competitiveness yield sustainable structural benefits and position us to deliver peer leading financial performance in each of the regions in which we operate. To deliver this, we will optimize our portfolio to deliver outperformance now and in the future. We'll leverage our value chain advantages and ensure the competitiveness of our assets, while we continue to invest in our people. Our execution of these commitments positions us to deliver the strongest through cycle cash generation.

Durable Midstream growth is expected to deliver cash flow uplift and to deliver distribution increase going forward, a differentiator from our peers. Investing capital where we believe there are attractive returns will enhance our competitiveness now and for the future. We are committed to leading in capital allocation and will return excess capital through share repurchases. MPC is positioned to create exceptional value through peer leading performance, execution of our strategic commitments and its compelling value proposition. Let me turn the call back to Christina.

Thanks, Mary Anne. As we open the call for your questions as a courtesy to all participants, we ask that you limit yourself to one question and we'll follow-up. If time permits, we will re prompt for additional questions. Operator, please open the call for questions. Operator, we're ready for questions.

Thank you. We will now begin our question and answer session. Our first question comes from Neil Mehta with Goldman Sachs. Your line is open.

but maybe we start on what you're seeing real time from a demand perspective as we get into deeper here in the second quarter. Are you seeing any physical evidence of an economic slowdown? And just maybe give you some real time color of what you're seeing in your system here.

Yes. Good morning, Neil, and thanks for the question. Look, I think we've seen Refined Cracks improve. You look we're about $4 better the second quarter than we were in the first. It's showing the typical seasonal improvement into the second quarter.

You've seen our guidance when we look at overall utilization 94% particularly when you look at The Gulf Coast 90 6 Percent for us as we get out of our second largest turnaround and if you will ready to run-in the second quarter. We think we are well positioned to meet this seasonal uptick in demand. And certainly when you look at the fundamentals the inventories that I referred to the five year average etcetera and certainly sort of the overall outlook. But I'm going to ask Rick to give you some specifics as he's looking at our system and demand to address your question.

Yes, Neil to bolt on to Mary Anne's comments. So real time we're very optimistic on what we're seeing. Within the domestic business we're seeing steady year over year demand for gas and we're seeing growth in diesel and jet fuel. And then additionally when we look at our exports Neil when you go year on year, quarter on quarter, we're seeing increases in export demand as well. So all the way across system, we are seeing positive signs and aren't really seeing a slowdown whatsoever.

Closer to home to what Mary Anne mentioned, on the inventories, I want to double tap on that for a moment because those signals are really important to us and, a great indication of how the market is setting up as we head into our summer driving season. So as you know, we did a lot of turnaround work in Q1. We are ready to run-in Q2. And with the lower street prices year on year, we see this as another strong demand signal that the consumers will have to continue this demand strength that we're seeing. And lastly, Mary Anne mentioned the $4 a barrel increase versus Q1.

Just a few specifics on that to break down for you by region. In the Mid Con, we're seeing a $6 a barrel increase of where we stand today versus the Q1 results. In the Gulf Coast, the $3 a barrel increase and in the West Coast, 5 Dollars a barrel increase. So strength across the system, Neil.

Yes. Okay. You see in the margins for now and so it's definitely notable in some of the hard data here. So okay, then the follow-up is just on the West Coast specifically. We've seen a lot of developments here, most notably, Benicia.

But how are you guys thinking about the multiyear outlook for the West Coast? How do you position yourself? And do you think that the political environment is such that if you go into a period of strong margins, you'll be able to capitalize that?

Yes. Thanks, Neil. Maybe a few things the West Coast and our views sort of longer term. First, as you know, we've been investing I mentioned it on some of my prepared remarks there. We've been investing in our LA asset.

We believe its flexibility, the integrated nature of that asset, its ability to process different types of crudes etcetera, gives us a long term competitive advantage. In the case of this capital that we're putting to work gives us efficiency improved performance EBITDA while at the same time we are complying with regulatory requirements around NOx emissions. So overall we think that's been a good investment. Just when we think about demand in the West Coast right 28,000,000 conventional fuel vehicles as I like to say in the state, a lot of that demand is centered in the Los Angeles region. So speaks well for our asset also.

And then you speak about the regulatory environment. We've spent a lot of time as you know go back really to twenty eighteen, twenty nineteen frankly as we began our assessment of our profitability and the competitive nature of our assets in that region when we made the decision frankly to close Martinez as a fossil fuel refinery albeit right continued as a renewable diesel. We're watching the regulatory environment very closely right. We've got minimum inventory law went into place in the beginning of the year. But frankly the rule making isn't done.

I think right now the state and the officials there are focused on resupply as maintenance and turnaround activity happens to ensure that we can provide they can provide requirements for consumers there. There's also been conversation around whether or not the state would own or operate refineries. We certainly don't think that that's plausible, but we'll watch it closely. And last what I would say is we are spending time with the regulatory agencies through our Washington office etcetera to ensure that there is an understanding of sort of the longer term view and the decisions that they are trying to make there. So we're comfortable as we sit here today recognizing that a challenging environment.

We think we've got one of the most competitive assets in the region. And hopefully I've done a reasonably good job of telling you why that's the case. I'm going to ask Rick to give you a little bit of color on what we're seeing maybe long term with demand there.

Yes. So Neil, we continue to see pretty positive signals also on the West Coast. But I want to maybe take a step back and give some color to our positioning as well to add on to Mary Anne's comments. So we have the largest refinery in California. It is complex.

It is fully integrated. And we will beat the what we call high cost alternative of imports into the region all day long. With that being said, the closures, that we have seen certainly are a tailwind to our not only our LAR facility, but also to our Pacific Northwest facilities. So if you look, they will also be the beneficiary of product placement. And as you know, the West Coast is structurally short gasoline and jet.

So we will be leaning into these markets as others close. And lastly, I want to leave you with a nugget that not a lot of people talk about. It's on the feedstock side, if these closures happen that have been announced Neil, we will be the beneficiary as well. We have a large TMX position, taking advantage barrels from Canada. But above and beyond that, we're a big ANS and a big SJV buyer and we will be the beneficiary of those closures that if they happen that will put incremental pressure on those differentials and we have a larger appetite for those grades.

Thank you. Our next question comes from Doug Leggate with Wolfe Research. Your line is open.

Good morning everyone. Thanks for taking my questions. Mary Anne, I want to come back to a topic that I feel like we used to bring it up relatively frequently and then it kind of fell into the background a little bit and it's the issue of capture rates. You had one of the heaviest turnaround seasons in I guess in your history this quarter, yet your capture rate kind of knocked it out of the park. And I know this is related to the commercial organization that you've built up over the last several years.

And I'm just wondering, as you get back into normal utilization rates into the when you don't have a lot of downtime, should we be thinking that your capture rate has shifted up as a matter of course or I'm just curious how you would respond to that comment?

Good morning Doug and thanks for your question. So as you know one of the things that we've been really leaning in for some time is our ability to improve our commercial performance. We think it is one of the most important elements when we think about our value proposition and our peer leading performance. And over the last few years as you said, we've been building what we think are sustainable benefits across the system organization wise, other capabilities. We've talked about, our London office, our Singapore office, our Houston office in addition to our Findlay office as well.

So some of these capabilities will transcend. We've also said that approaching 100% is clearly an objective of ours. And we think some of the sustainable advantages that we've really put in place are being demonstrated through our financial performance. And as you know some of these things regardless of whether it's a high crack environment or a low crack environment may not be in our control. But the ones that are, are that what we are trying to focus on quarter after quarter.

We think right looking at our fully integrated system and trying to leverage those capabilities you hear us talk about value chain integration, the strategic importance of the relationship between MPC and MPLX. We believe all of these will continue to deliver, capture rates approaching 100. And I'll look at Rick and see if there was anything else that Rick wanted to add particularly as we think about what happened in the quarter.

Yes. Thank you, Mary Anne. Doug, I have to chuckle for a moment. I'm guessing Mary Anne thinks I paid you to ask that question because we are quite proud of our results. Not only has it been this quarter, but I think you've seen it the last several quarters.

And I do want to reiterate that it is structurally sustainable. We believe we built the system and have the value chain to continue to garner more value than our competition. And three areas of particularly strong performance that I want to highlight and our specific teams Specialty Products, Asphalt and product margins. And sometimes we mention product margins and they're specific to a region. This past quarter I would tell you it's all three regions.

It's Gulf Coast, Mid Con and West Coast. So very proud of the team's performance and wringing value out of the entire value chain as Mary Anne referenced.

Okay. Well, I was thinking the 100% might now be a little conservative, but We'll see where we go.

Please don't do that to me. But we're confident in our ability to outperform in this area, Doug.

Good stuff. Thanks for the answer. Mary Anne, a completely unrelated question. Again, it's something that's come up periodically. You've talked about you want to hold $1,000,000,000 of cash on the balance sheet, but you did admittedly have some working capital moves and you lend it into the balance sheet this quarter, it seems for share buybacks.

What is the net debt level at the MPC level? Try that again, the net debt at MPC level that you're comfortable with as opposed to the cash level at the MPC level?

Yes. Thanks for the question, Doug. Maybe just a couple of other comments as well before I get to your specific answer. But one of the things that we think is important as we try to lean in with respect to our capital allocation priorities and they haven't changed. You talk about the $1,000,000,000 As you know from quarter to quarter, some of those things just depending on commodity prices etcetera

But the billion dollars continues to be something that we have stress tested and remain comfortable in part because we had a realized situation many years ago called COVID that helped us understand that. The second part of that, as you know, and I think you've been asking me this question for a couple of quarters now, right, if not longer than that. The distribution that MPC receives from MPLX at $2,500,000,000 today covers the MPC dividend to its shareholders as well as the 2025 capital plan that MPC has announced. And hopefully, you can see that we are supporting that mid single digit growth in MPLX and the distribution increase of 12.5%, which means the cash coming back to MPC should continue to increase as that growth in MPLX happens. These are all factors that give us confidence when we talk about $1,000,000,000 on the balance sheet that that continues to be if you will a durable basis.

I'm going to pass it to John and he can talk a bit about the debt to specifically answer that question. Doug?

Yes. Hey, morning Doug. Thanks for the question. So maybe again to take it back, as you know, we'd like to kind of think about the two balance sheets a little bit separately. So if I think about MPC standalone, I'll come back to MPLX in the Midstream business.

Look, we've said absolute gross debt, we're comfortable in and around plus or minus 7,000,000,000 right. So $7,000,000,000 absolute debt, the $1,000,000,000 of minimum cash target again I commented and Mary Anne did why we continue to be really, really comfortable with that and comfortable with our investment grade profile. MPLX is a little interesting, right? There, debt has stayed relatively flat, but we've really grown the EBITDA, four year CAGRs of 7%. So leverage has really come down.

And there, we look at kind of a gross debt to EBITDA and we're sitting at end of this quarter at about 3.3 times. And we've said, look, given that business, the durability and stable cash flows it generates, we're comfortable up to four. So we see a lot of capacity there as MPLX looks at its growth opportunities to leverage that balance sheet. Again on the MPC side, absolute debt about $7,000,000,000 As I think you know there we talk again about a gross debt to cap ratio And I think we've got some of that in our materials as well, what you would typically see more with an investment grade approach. It's a little bit interesting there because if we did something like we did this quarter where we're leaning into buybacks and maybe a lower profitability market, you're going to impact that ratio.

But over time, we're really comfortable with that $7,000,000,000 So hopefully that helps Doug.

Thank you. Our next question comes from Manav Gupta with UBS. Your line is open.

Good morning. Congrats on a strong quarter. I wanted to ask you about the crude quality discounts. Looks like OPEC would be raising volumes faster than most of us expected. So help us understand your near to medium term outlook for crude quality discounts and how MPC can benefit from it?

Yes. Hi, Manav. This is Rick. Good to hear from you. I will say this is very positive for us given the amount of heavy crude we run-in all three regions West Coast, Gulf Coast and Mid Con.

So we are arguably the largest heavy refiner in the country And so we will benefit significantly. And as we see the acceleration of OpEx volume with the recent announcement this weekend certainly as a tailwind for the light heavy spreads. Additionally though, I'd like to give you some color on Canadian because Canadian has recently been depressed but we see upside there Manav as well when you look at not only the OPEC announcement of accelerating their barrels into the market, but as you look forward on their forward curve and I don't even think the OPEC piece is baked in yet. In the fourth quarter Manav, we're seeing $3 to $4 a barrel discounts greater than what we see today. So certainly that's a benefit to us as we run a lot of heavy Canadian as you know.

Perfect. I actually also wanted to follow-up a little bit on the midstream side. 7% year on year growth on the MPLX side. But when we look at year to date, almost $1,000,000,000 of acquisitions, some of which have not even closed, right? And so if you think about it, how should we look at the distributions from MPLX growing over a period of time, given you already had an attractive lineup of project growth with Frac one, Frac two and now you're adding $1,000,000,000 of additional assets.

So can we think about that 1212.5% growth from distribution could be sustainable for the next like three to four years? And then you're already covering your CapEx and dividend through that distribution. So does buybacks can also be supported through that distribution, if you could talk about that? Thank you.

Manav, thank you and good morning. Appreciate your question. So, first of all, when you look at the MPLX, the midstream business, we talk about a compound annual growth rate both on EBITDA and DCF in and about 7% for four years. We think as you have heard us talk about as well that we have projects and opportunities to be able to continue that mid single digit growth. I'll bet I'd say it might not be perfectly linear as we move out.

The point of that 12.5% distribution increase last year was to say, when you look at the growth opportunities, when you look at these mid teen returns projects using that strict capital discipline lens, we felt very good about suggesting that that 12.5% was clearly doable for the next few years to your point because of the durability of those earnings and the opportunities that we see. This quarter we put about $1,000,000,000 to work. You are absolutely correct. Some of that has not closed yet. BANGL gives us will give us 100% ownership, very critical when we think about the ability to support our producer customers, important to the integration of our wellhead to water strategy.

Second, we talked about Whiptail. It's a gathering it's natural gas, crude oil and water gathering system. We talk a lot about the value chain importance and the strategic relationship between MPC and MPLX. It's in the four corners, critically important on the opportunity for our El Paso refinery. So two examples as you say plus, as you know we talked about $1,700,000,000 of capital in MPLX that is growth oriented of which 85% was natural gas and NGL focused.

Secretariat seventh largest sorry seventh processing plant in the Permian bringing our processing capability when it comes online at the end of the year to about 1.4 Bcf. So really making the connections in the integrated value chains. So we believe that 12.5% is durable for multi years as we bring it back to MPC. To your point, we are already covering the MPC dividend. And as you know, we are continuing to lean in delivering right excess cash via buyback on the MPC side.

And then we are still covering the cost or excuse me, the capital cost with that distribution. So certainly as it grows, it will continue to give us even greater flexibility on the MPC side of the house. I hope that addressed your question Manav.

Thank you. Our next question comes from Paul Cheng with Scotiabank. Your line is open.

Good morning, Paul. We're well. How are you?

Very good. Good morning. The Marion, just want to ask that. It seems like you and a lot of your peers, everyone is looking at the NGL value chain and have a lot of opportunity. And so that seems a very consensus view and everyone is pursuing a wellhead to water strategy.

So can you try to help us understand that how your strategy may be different than your peers? And there's also in the commodity business, there's always some fear. If everyone is pursuing the same strategy and everyone see that is such a great thing, it turn out that we sell may not be as good as everyone hope. So maybe that you can help us that to better say understand that what is the risk in terms of everyone is doing this?

Certainly, Paul. Thanks for the question. So we think and we've talked about our wellhead to water strategy, our completion two fracs in the Export Terminal 20 20 8 and 2029. We are very confident in our ability to fill these two fracs. As I mentioned just earlier, we've got the seventh processing plant in the Permian that's going to be complete.

That will give us 1.4. And frankly, our current customer commitments really support this project. Also keep in mind today we meaning, as we're thinking about this fractionation we are using third party fracs which we will not need to use in the future. We think it has a very solid cost position as we shared with you the total cost of the project. We think when we look at both C3 and ethane, ethane will be a domestic sale, but we know the strength of C3 when we look at its requirements in Asia, Japan, etcetera.

So we think that export market will be there. And we think we're very good at executing projects. And certainly our commercial prowess will give us the ability to market that in the future. They would be a few of the things Paul that I would tell you will differentiate this project from our peers. And as I mentioned, we're not looking we're not done.

We are really trying to adapt as these markets are changing and completing these value chains particularly when we're looking at that wellhead to water strategy. I hope that addresses your question Paul.

Okay. Great. The second question is on the renewable diesel business. Yes, I mean, it does look like that the RIN price is going higher and hopefully the LCLS price will get will the amendment will go through and then we will see them higher later this year or next year. But in addition to the market condition, I mean, else are you doing internally trying to improve the profitability of that business.

Marathon Petroleum (MPC) Q1 2025 Earnings Call Transcript

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