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.

Fortune Global 500

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.

Fortune 500

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 2025. 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 2025

Q1 2025

Q4 2024

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

legacy

Marathon Petroleum

marathon petroleum

Welcome to the MPC Fourth Quarter twenty twenty four 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 would now turn the call over to Christina Kazarian. Christina, you may begin.

Welcome to Marathon Petroleum Corporation's fourth quarter twenty twenty four 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 Mannin, CEO John Quaid, CFO and other members of the MPC and MPLX executive teams. 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. I wanted to quickly highlight our new segment reporting, which includes a Renewable Diesel segment. We believe this expanded level of reporting will enhance our comparability with our peers and provide you with more insight into our financial performance and capital allocation decisions. Previously, the results of the Renewable Diesel business were included in our Refining and Marketing segment.

For your reference, Slides twenty four and twenty five provide illustrations of this reporting change, and we have provided recast historical financials in our investor packet available on our website. With that, I will turn the call over to Mary Anne.

Thanks, Christina, and good morning. Let me take a moment to highlight a few elements of our performance that we were most that were most relevant to our results. In 2024, we executed on our strategic commitments.

First and foremost, we achieved our lowest company wide OSHA recordable injury rate and strongest environmental performance in the last five years, demonstrating our commitment to safety and reliability. Over the full year, we delivered Refining and Marketing segment adjusted EBITDA per barrel of $5,.33 Our commitment to operational excellence, commercial performance and peer leading profitability per barrel in each of the regions in which we operate drove our strong results with refining utilization of 92% and commercial capture of 99%. Our midstream segment, which is where we report MPLX's results, grew adjusted EBITDA by 6% year over year. In 2024, increased its quarterly distribution by 12.5%, driving an annualized cash distribution to MPC of $250,000,000,0.0 This was the third consecutive year of distribution growth of 10% or greater. This was the fourth consecutive year of MPLX generating mid single digit adjusted EBITDA growth.

Since 2021, we've grown adjusted EBITDA at a compound annual rate of 7%. Our full year net cash from operations was $870,000,000,0.0 This enabled peer leading capital return of $1,020,000,000,0.0 and a 23% capital return yield for our shareholders in a business where there is significant value in the ability to return capital to shareholders. The global macro environment continues to deliver refined product demand growth and we expect 2025 will be another year of record refined product demand. In our domestic and export businesses, we have seen steady year over year demand for gasoline and diesel and growth in demand for jet fuel. Refining margins exhibited their typical season weakness.

We expect margins will improve in the of this year as announced to refinery closures offset recent capacity additions. Leveraging our fully integrated refining system and geographic diversification across the Gulf Coast, Mid Con and West Coast regions, we are well positioned to perform in this dynamic market environment. Longer term, we believe fundamentals support an enhanced mid cycle environment for refining as we expect demand growth to exceed the net impact of capacity additions and rationalizations through the end of the decade. We expect The U. S.

Refining industry to remain structurally advantaged over the rest of the world, mainly due to the availability of low cost energy. We remain steadfast in our commitment to safely and reliably operate our assets and protect the health and safety of our employees, business partners and the community in which we operate. Our high complexity refining assets and our domestic and international logistical and commercial capabilities further increase our global competitive advantage. We are committed to achieving peer leading profitability in every region in which we operate. And over the past several years, we have acted to advance on this commitment.

We have made sustained structural changes to improve our cost competitiveness, while maintaining safe and reliable operations. Throughout our commercial organization, we are improving value chain optimization with a more integrated and advanced approach to our execution. We made disciplined investments in our refining and marketing value chains targeted to enhance margins, reduce costs and optimize systems. Across all three of our regions, we see the results of these actions. Along The U.

S. Gulf Coast, where 42% of our capacity exists, we have more than 1200000.0 barrels per day of refining capacity, which leverage feedstocks and logistics flexibility to provide a wide range of products to meet U. S. And export demand. 40% of our capacity is defined as our U.

S. Mid Con region. We have eight refineries with a total capacity of 1200000.0 barrels per day, which capture market opportunities by leveraging our access to advantage feedstocks, logistics and optimization of our large integrated value chain in the region. The remaining 18 of our capacity resides along The U. S.

West Coast anchored by our 365000 barrel per day Los Angeles refinery in its fully integrated value chain, which benefits from feedstock and product optionality and a highly competitive marketing business. Our commitment to safe and reliable operations, operational excellence and commercial performance position us to deliver peer leading financial performance irrespective of the market environment. Our disciplined capital investments have also strengthened our competitiveness in each of the regions in which we operate. Looking into 2025, we believe our planned capital investments will further enhance MPC's position well into the future. MPC's capital outlook for 2025, excluding MPLX, totals $1,250,000,000,.00 Underpinning our commitment to safety performance and environmental stewardship, sustaining capital is approximately 30% of capital spend.

Investments in our refining and marketing segment are focused on value enhancing and cost reduction opportunities with expected returns averaging around 30%. Renewable diesel capital spend in 2025 is limited and will be focused on sustaining current operations. I'll provide some details on three of our major multi year projects that meet our criteria for investment. We are progressing the distillate hydratereater project at Galveston Bay, where we are investing to construct a 90000 barrel per day high pressure distillate hydratereater. Once in service, the new distillate hydratereater will upgrade high sulfur distillate to ultra low sulfur diesel, allowing us to place product in this higher value market.

This project is expected to be completed by and generate a return of over 20%. The Los Angeles Refinery is a core asset in our West Coast value chain and one of the most competitive refineries in the region. This low carbon refining investment once completed is expected to further enhance its competitiveness by integrating and modernizing utility systems to improve reliability and increase energy efficiency. Additionally, a portion of the improvements address a regulation mandating emissions reductions for all Southern California refineries. The improvements are expected to be completed by the end of this year.

We expect to generate a return on our investments of approximately 20%. The Robinson product flexibility project is expected to further extend the competitive position of our Mid Con value chain by shifting yields to higher value products. This investment will increase the Robinson Refinery's flexibility to maximize jet production to meet growing demand. We expect the project to be completed by the and generate a return of approximately 25%. The strategic investments at our Galveston Bay, Los Angeles and Robinson refineries ensure we provide the clean burning fuels the world demands and further strengthen the competitive positions of our U.

S. Gulf Coast, West Coast and Mid Con value chains. This morning, MPLX also announced its 2025 capital outlook of $2,000,000,000 including $170,000,000,0.0 of growth capital and $300,000,000 of maintenance capital. Approximately 85% of its growth capital will be allocated to investments to grow MPLX's natural gas and NGL businesses in support of expected increased producer activity. MPLX is investing to expand its Permian to Gulf Coast integrated NGL value chain, progressing long haul pipeline projects and grow Permian and Marcellus processing capacity.

MPLX anticipates mid teen returns on its growth capital outlook, which will extend the durability of its mid single digit growth profile. Over the last four years, on average, we have grown our midstream segment adjusted EBITDA by almost 7% per year. The growth of MPLX's cash flows combined with its strong distribution coverage and low leverage provides MPLX considerable financial flexibility. We believe MPLX is positioned for additional distribution increases like the 12.5% announced in 2024 in the future. MPLX reached a significant milestone in its NGL well head to water value chain strategy with the announcement of a project to construct the Gulf Coast Fractionation Complex and Export Terminal.

MPLX's fully integrated NGL value chain connects the Permian to the Gulf Coast and will supply growing global demand for LPGs. The multi year two point five billion dollars investment in the fractionation complex and export terminal complements MPLX's existing asset base and leverages existing infrastructure. MPLX will build and operate the Gulf Coast Fractionation Complex consisting of two one hundred and fifty thousand barrel per day facilities and a 400000 barrel per day LPG export terminal, all of which will be located adjacent to MPC's Galveston Bay refinery. MPLX has entered into joint venture agreements with One Oak for the export terminal and a bidirectional purity pipeline between Mount Bellevue and Texas City. One Oak will market its 200000 barrels per day and provide connectivity to Mount Bellevue storage, enhancing the competitiveness of the terminal.

We also believe this strategic partnership with One Oak will create additional optionality and value for our customers. We also see it as a platform for future collaboration and growth across our Gulf Coast assets. MPLX plans to market methane production from the fracs to both existing and new customers. Leveraging our strategic relationship with MPLX, MPC plans to contract with MPLX to purchase the remaining LPG production from the fracs, which MPC will market globally through its existing market businesses via the new export terminal. The fractionation facilities are expected to be in service in 2028 and 2029 and the export terminal is expected to be in service in We anticipate mid teen returns on the project, which is expected to begin generating EBITDA when placed in service in 2028 and will ramp through the February,.

Additionally, we believe the expansion of our Gulf Coast NGL value chain will create a platform for optimization and incremental growth opportunities. Our capital allocation priorities remain consistent. Our number one priority is sustaining capital. We remain steadfast in our commitment to safely operate our assets and protect the health and safety of our employees and the communities in which we operate. We are committed to paying a secure, competitive and growing dividend.

We will invest where we believe there are attractive returns, which will enhance our competitiveness and position MPC well into the future. Beyond these three objectives, we will return all excess capital through share repurchases. As of the end of the year, we had $780,000,000,0.0 remaining under our share repurchase authorization, highlighting our commitment to superior shareholder returns. The durable and growing cash flow of MPLX differentiates MPC from peers. MPLX is strategic to MPC's portfolio and therefore its value proposition.

We expect distributions from MPLX in 2025 will cover MPC's dividend and standalone capital outlook. Operating cash flow generated by our refining and marketing and renewable diesel segments are expected to be available for capital return through share repurchases. With our highly advantaged refining business and the $250,000,000,0.0 annualized distribution from MPLX, we are positioned to lead peers in capital returns through all market cycles. Let me turn the call over to John.

Thanks, Mary Anne. Moving to the and full year highlights, Slide 14 provides a summary of our financial results. This morning, we reported adjusted earnings per share of $0,.77 for the and $9,.51 for the full year. Adjusted EBITDA was approximately $210,000,000,0.0 for the quarter and $1,130,000,000,0.0 for the year. Refining and Marketing segment adjusted EBITDA per barrel was $2,.03 for the quarter and $5,.33 for the year.

Cash flow from operations, excluding working capital changes, was $170,000,000,0.0 for the quarter and nearly $820,000,000,0.0 for the year. And during the quarter, we returned $2.92,000,000 dollars to shareholders through dividends and repurchased nearly 1300000000.0 of our shares. Slide 15 shows the sequential change in adjusted EBITDA from and the reconciliation between net income and adjusted EBITDA for the quarter. Adjusted EBITDA was lower sequentially by approximately $400,000,000 driven by decreased results in our Refining and Marketing segment, slightly offset by improved results for our Midstream and Renewable Diesel segments. The tax rate for the quarter was 12%, largely reflecting the earnings mix between our R and M and Midstream businesses.

Moving to our Refining and Marketing segment results for the on Slide 16. Lower crack spreads, mainly in the Mid Con region, were the primary driver for lower R and M margins in the Our refineries ran at 94% utilization, processing nearly 2800000.0 barrels of crude per day and refining operating costs were $5,.26 per barrel in the Turning to Slide 17, solid commercial execution as well as typical seasonal tailwinds drove capture of 119%. We leveraged the scale of our fully integrated system in all three regions to capture margin opportunities across our entire value chain from feedstocks to products. We are committed to improving our commercial performance and believe we are building capabilities that will provide sustained incremental value and will produce results that can be seen in our financials. Slide 18 shows our Midstream segment performance for the quarter.

Our Midstream segment continues to deliver cash flow growth. As segment adjusted EBITDA for the quarter was up nearly 5% sequentially. MPLX, which is the largest portion of our midstream segment, remains a source of durable growth as it progresses its mid single digit adjusted EBITDA growth strategy. Slide 19 presents the elements of change in our consolidated cash position for the Operating cash flow, excluding changes in working capital, was $170,000,000,0.0 in the quarter, driven by both our refining and midstream businesses. Working capital was a $4.97,000,000 dollars source of cash for the quarter, primarily driven by benefits from inventory reductions and a decrease in refined product prices.

Capital expenditures, investments and acquisitions were $9.35,000,000 dollars for the quarter. Cash was utilized to repay $1,150,000,000,.00 of MPLX senior notes that matured in Dec. 0. And MPC returned almost $130,000,000,0.0 through share repurchases, exclusive of excise tax payments, and $2.92,000,000 dollars in dividends during the quarter. At the end of the year, MPC had approximately $320,000,000,0.0 in consolidated cash, including MPC cash of $170,000,000,0.0 and MPLX cash of $150,000,000,0.0 Turning to guidance, on Slide 20, we provide our outlook.

We are projecting crude throughput volumes of just over 2500000.0 barrels per day, representing utilization of 85. Turnaround expense is projected to be approximately $4.50,000,000 dollars in the with activity focused in the Gulf Coast and West Coast regions. For the full year, turnaround expenses are expected to be similar to last year at around $140,000,000,0.0 For the quarter, operating costs are projected to be $5.7 per barrel, distribution costs are expected to be approximately $150,000,000,0.0 and corporate costs are expected to be $2.20,000,000 dollars 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 position us to deliver the strongest through cycle cash generation.

Durable midstream growth is expected to deliver cash flow uplift and expected 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 in 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 over 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 a follow-up.

Our first question comes from Neil Mehta with Goldman Sachs. Your line is open.

Yes. Thanks, Mary Anne and team. I guess the first question is just on the refining side. There was a $5.43,000,000 dollars positive capture impact in the quarter, 119% capture. And curious, how much of that was seasonal?

Typically 4Q you tend to capture well versus commercial, anything you can do to kind of unpack it either regionally or in terms of what the underlying drivers of that capture beat?

Yes. Thanks, Neil. Good morning again. So look, as you know, and you look back over our last several over the past few years, our tends to be one of the strongest quarters. I think if you look at it over the last several years, we've averaged in a range of about 115, one hundred and 16.

In general, as you know, when we look at capture, there are clearly things that we don't have control over and then there are the things that we do have control over. As we've been sharing, our objective is to approach 100%. This year on average, we reached 99% in the refining and marketing opportunity there. So clearly some things that we believe have been structural in the work that we've been doing, we've been sharing over the last couple of quarters and obviously some of those that have just normal activity. But I'm going to pass it to Rick because I think he's got a few things that he'll give you some specifics on.

Yes. Hi, Neil. Let me start by saying thank you for calling this out. This is obviously a significant focus for us and the team executed extremely well in the So just a couple of nuggets for you. On the export side, Neil, we've been stating quarter after quarter that we're leaning into our export strategy and the was a great example of that.

Our assets ran extremely well across the board and we were able to lean into our export strategy and set records on volume and margin. So that's a piece of the puzzle, Neil. And then secondly, an area that we don't speak much of is asphalt, but I will say we had great execution on the asphalt asphalt spreads and execute our strategies driven by strong asphalt retail sales. So those are just a couple of nuggets, Neil. There's many more, but I'll just leave you with those two.

Thank you, Rick. And the follow-up is just on MPLX and the wellhead to water strategy. The mid teens returns that you're targeting on this, can you talk a little bit about some of the underlying assumptions? And is it fair to say that even though capital is coming in a little higher at the midstream side of the business, given the framework that you laid out here where the buyback is coming from the refining and renewable diesel business, higher MPLX spend won't impact the outlook for your ability to return capital?

Yes, Neal, certainly. Let me try to answer those questions for you. So first and foremost, when we think about this NGL well head to water strategy, you're right, we do expect mid teens returns. You may know that over the last several quarters, we have been talking about the opportunity set, but frankly, we've been looking at this project for a period of time. So underlying assumptions with respect to overall capital that we need to spend, timing of that, markets that we will serve, cost to get implemented are all things that we have considered and evaluate and evaluated to be sure that when we look at this project that we're confident in these mid single digit returns.

I think the next project sorry, question that you asked was really about capital and whether or not the capital that we would be spending in MPLX has implications for MPC. So the answer to that is no. As you know, MPLX has really solid balance sheet flexibility. One, when you look at the debt to EBITDA ratio, we've talked about our ability to be kind of in the range plus or minus four times. We're somewhere in the range of three.

So we absolutely have balance sheet flexibility there. Really all of that 2500000000.0 multi year capital in MPLX is largely MPLX. There's a 70,000,000 piece that is MPC. And then the last part of that is, as we continue to grow that MPLX distribution, you've heard me talk about the 12.5% increase. That's a 2500000000.0 distribution to MPC.

It covers the 2025 dividend and the 2025 capital that we just announced of 1.25. Therefore, giving MPC the flexibility to return capital via share buyback. So balance sheet flexibility in MPLX will support the growth of those MPLX projects. Hope that gets

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

Thank you. Good morning, everyone. Good morning, Marianne. Fantastic result in refining despite breakeven. We actually see that bullish.

So well done. My question is, I hate to ask the obvious one, but we've got a thirty day delay now potentially on, I don't know if it's posturing or not, but the tariff situation, you guys are obviously a large consumer of heavy barrels. My question is, what would be your how are you planning for the contingency? What would the impact be? I'm thinking specifically about how does your plant adapt to a different diet of crude if you had to?

Framing it for us in whatever way you like, but we're obviously all trying to struggle with what it would actually mean if a tariffs were in fact introduced?

Yes. Good morning, Doug. Thanks for your question. Yes, it's interesting. Studying tariffs has been at the top of the list of things that we've been doing among many others like running the business, right?

But so when we think about the impact of tariffs, one, if they were to be imposed or not, it's still a variable question. We've got a highly integrated system and we've got a lot of optionality, and we'll use that optionality. Having said that, as you state, we do process a significant amount of heavy crude. And therefore, we think it's likely if tariffs were to be put in place in thirty plus days or not that we would see cost increases. We believe that the majority of that will ultimately be borne by the producer and then frankly to a lesser extent the consumer.

We MPC will use our integrated system, our commercial excellence, our operational performance to really minimize the best that we can the margin impact to our financial results. That's our goal and we'll continue to evaluate. We're working with the administration and we're working with agencies as well as the trade associations to be sure that the right people understand the implications of these decisions. But with that, let me me pass it to Rick and he can give you a little more color on our diet.

Yes. Doug, a very timely question as we have run scenario planning for every facility and market that we have coast to coast. So we're well versed in this as you might expect. And Mary Anne hit it well when she touched on our integrated system, our knowledge, our commercial performance. We believe we're in as good or better shape than anyone in the industry to absorb a tariff if it were to ever get put into place.

And maybe a good example of that that I would want to unpack for you is in the Mid Con, we have worked tirelessly for a long time on our logistics capability and connectivity. So many of our refineries in our Mid Con region, we could look to pivot to alternative crudes because of our logistics capabilities and we're quite unique that way. And I would give you crudes to think of such as Bakken, Rockies, Utica, Marcellus as a few. So I want to leave you with every region is different, every refinery is different, but we believe that we have done the scenario planning to make this as least painful as possible. And in fact, we believe at the end of the day in most regions, if not all that we operate in, we'll have a competitive advantage against others who are running significant amounts of Canadian grades.

Rick, I appreciate the detailed answer from both of you. I wonder if I could just do a quick Part B on that. If you did displace heavy with a Bakken or similar crude, would that require utilization reduction?

It may shift yields more than anything, Doug, and it could potentially impact utilization. However, I would lean you maybe ask you to as you look at yesterday as it played out, the market was quickly sending signals that it would quickly respond and absorb a lot of the indicators that would continue to make potentially a heavy barrel economic to run. As Mary Anne said, we do believe the producer will bear a large part of the impact. So I would say a light switch within our system, we believe would have minimal impact.

Thank you. Mary Anne, I've got a very quick follow-up, which is, I wanted to pick on one of your comments at the end of your prepared remarks. We will optimize our portfolio. I wonder if you could care to elaborate on what that means? And I'll leave it there.

Yes, certainly, Doug. You know for the last several years, one of our strategic pillars is to ensure the competitiveness of all of our assets that has been in place historically and will continue to be in place. We need to be sure that every one of our assets is delivering the cash flow that we expect and is part of our long term scenario for how we will operate in the future. So we'll continue to look at that all the time.

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

Hey, Marianne, I wanted to congratulate you. I think when you took over the CEO, one of your key goals was that to fully fund the dividend and CapEx at MPC through MPLX. And our model got you there, but we got you there more in 'twenty six and 'twenty seven. We didn't have you getting there in 2025. So congratulations on that.

My question here is we think about MPC's buybacks as funded by RD and refining with MPLX funding the dividend and CapEx, but the projects that you announced today could put you on a distribution growth path of 12% for four or five years. So starting 2026, is it possible that MPLX distribution is not only funding the CapEx, the dividend, but also possible buybacks at MPC?

Thank you, Madhav. So we have been trying to demonstrate that our cash flows being generated at MPLX are durable and that we can put together capital as well as small M and A bolt on that can support mid single digit growth for a period of time. And hopefully today the announcement of our NGL strategy well head to water value chain isn't yet another example of that. In addition to some of the investments that we made in 2024 expansion of BANGL as an example, our Summit acquisition in the Utica and Wing to Webster. That 12.5 distribution increase that we announced in we also said we thought had the ability to be sustaining in similar nature for the next several years.

So as we continue to grow, we certainly believe that distribution coming back to MPC gives us flexibility for peer leading capital allocation. We think it's a differentiator and certainly we believe that that growing distribution to MPC will allow us to increase our share repurchase in the future.

Perfect. My quick follow-up is a little bit on the West Coast. You and other refineries probably going to go down at the year end. There are some reports of an unplanned refinery downtime also in the first half now. So just trying to understand from your perspective the dynamics on the West Coast, understanding that the regulatory environment may not be the best, but from the perspective of supply demand, the region might still work for you.

Yes. Actually, I think you said it well. As you know, we have made some commitments in investments. I talked about one of them here on the call this morning for our Los Angeles asset. One, we think it is a really efficiency capital investment.

We also think obviously it meets the required NOx reduction emission requirements going forward and gives us incremental efficiency and profitability particularly in a low carbon environment. Certainly, we understand the challenges of doing business in this environment. You know this well. I mean, we have evaluated our ability to participate in this region for many, many years. Hence, the decision that we made back in 2020 to close Martinez as a fossil fuel refinery and then in early in 2021, the decision to convert it to renewable diesel.

We're working closely with the agencies in the state to ensure that we understand and in similar fashion as I mentioned earlier through our trade associations also, really trying to understand and frankly influence be of help so that those making the regulatory decisions and the legislative decisions in the state have the facts that they need to make good decisions. We continue to believe our asset on the West Coast is one of the most competitive, particularly when you look at the integrated nature of it, the MPLX, as well as its ability to process various crudes, etcetera. So, yes, we continue to believe in the long term viability of that asset.

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

Hey, Tim. Good morning. Good morning. Mary, this year, I think you guys saying that your turnaround cost is about $140,000,000,0.0 similar to last year, which is quite high. So trying to understand that, as a for the cycle, what's considered as a normal turnaround cost for you guys?

Is $140,000,000,0.0 is the new normal or this is considered somewhat of a high year year also?

Hey, good morning, Paul. It's John. I'll maybe start with that and then we'll see what follow ups you might have. Certainly, like you said, we're looking at 1.4 for this year, similar to last year's. If you look back over the last several years, it gets a little bit hard to see a run rate, right?

You would have had COVID where we really would have slowed down. That would have pushed some turnarounds to the right, if you will, into future years. We also continue to invest in our assets and change kind of the capacity of what we have. I mean, interestingly, if you go back pre COVID and post either shutting down or converting refineries, we're almost back to the same or more capacity than we were previously. So, I think all of those things are driving that number.

And again, and Tim and the team can speak to this, right? Those are scheduled outages that we have on a cycle that we're managing to that we need to get done. I think though I was trying to give you some factors though that are maybe driving the 1.4% we're seeing for this year.

John, thank you for that. How about what consider from your internal, The U. S. Standpoint will be more of a normal cycle, say, average for the cycle?

Yes, Paul. I don't know if it's helpful to get into. There's lots of things that can move that on the asset portfolio, where we are in the schedule. I think we're we've even kind of stepped into here just recently giving you the number for the year. We used to just kind of give you the number by quarter.

So, I think if you're okay with it, we might just stick with what we're looking at for this year, and then we'll speak to it as the year progresses.

Okay. The second question, I want to go back into the margin capture. California actually have done really well, yes. I mean, you we stay and took out renewable, so that improved or that helped the margin, but still it's very good. Typically that I think for the built in branding, California doesn't really benefit that much.

So trying to understand that, I think Rick mentioned about export and some of that. Is there any one off item in California for this quarter we should be aware? Or that, I mean, is there any other factor that you can point us to why that seems to be performing really well?

Hey, Paul, it's John. I'll start maybe then turn it over to Rick. I think one of the things we would call out, really I'll start with Tim and his team and how we ran the facilities in the quarter, strong utilization, really positioning us to then turn to Rick and his team to take that production to market across our really competitive value chain. So at a high, high level, I think that's what you're seeing and maybe I'll turn it over to Rick for any other details.

Yes, Paul, maybe just to address the export comment. When I referenced our exports earlier, think of that as predominantly U. S. Gulf Coast. It's not that there weren't some exports going out of the West Coast, but they were minimal in terms of our overall portfolio.

The only item that I would add to John's commentary is we often talk fully integrated value chain and our advantages in California. And in house, we talk refinery to retail. And we are one of the few out there that takes the value chain all the way to the end consumer. And that is a value driver that I think that we believe is showing up in capture that others aren't able to capture. So we see it as a differentiator, Paul.

You're welcome. Thank you. Thank you, Paul.

Thank you. Our next question comes from Roger Read with Wells Fargo. Your line is open.

Anne. To come back to your comments on the macro and that demand may exceed capacity as we see more closures within the industry, what's your view here looking at 25% in terms of demand as we think about gasoline, jet fuel and then diesel particularly we finally got a plus 50% on the ISM manufacturing for this past month?

Yes, sure, Roger. I'd say, look, you've heard us share our views, really no different. As we look at the long term, we absolutely remain constructive over the long term. We think 2025 is going to be another year of growth in refined product demand and we see that continuing through the decade. As you know in 2025, there's we've got supply coming online, two of which we know we've talked about Dangote, DAS BOCAS, clearly some challenges, particularly in the here and even in the with DAS BOCAS.

And then there's probably about 800000 barrels a day that we think will be coming offline. One of them we know happening in the another one happening in the which probably won't have much impact in 2025. And then there's a few in well, I think one in Germany, couple in Scotland, Europe and then there's always really what happens with respect to China. So back half of the year, when we look at 2025, we think we should see improvement. We should see margins expanding.

Frankly, we're beginning to see a little bit of that as seasonal unwind begins to occur. In our system, gasoline year over year has been fairly steady, diesel up slightly. And to your point, we've actually seen jet demand growth, which is what you would expect as well. So overall, we remain constructive long term. I think the back half could look better.

China always an interesting dynamic to the extent that's better than we anticipate could be an accelerator. Obviously, some of the decisions that are being debated here with China would mute that and we'll have to wait and see what happens there. So I think that's how I would characterize it, Roger.

Appreciate that. And then maybe as an unrelated follow-up, obviously, a lot of things going on with the Trump administration on the tariffs and all, but there's also in the executive orders a lot of things to roll back a lot of let's call it pro sustainable energy or clean energy as it was advertised. What are some of the key things you're watching on that progress that may or may not be made during 2025?

Marathon Petroleum (MPC) Q4 2024 Earnings Call Transcript

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