Marathon Petroleum Corporation · NYSE:MPC
Marathon Petroleum — Investor Presentation (August 2017)
83 slides from Marathon Petroleum's investor presentation, Aug 3, 2017
Slide 1: Investor Presentation as revised on August 3, 2017
Investor Presentation as revised on August 3, 2017
Slide 2: Forward-Looking Statements
Forward‐Looking Statements This presentation contains forward-looking statements within the meaning of federal securities laws regarding Marathon Petroleum Corporation (“MPC“) and MPLX LP (“MPLX”). These forward-looking statements relate to, among other things, expectations, estimates and projection
Slide 3: Driving Strong Financial Performance Through Sustainable Competitive Advantages
Driving Strong Financial Performance Through Sustainable Competitive Advantages High Quality Network • Extensive platform of Midstream, Retail and Refining Assets of Strategically • Flexibility and optionality to optimize operations in a dynamic market Located Assets • Maximizes sales value of our p
Slide 4: Delivering Significant Returns for Our Shareholders
Delivering Significant Returns for Our Shareholders Since becoming an independent Commitment to Ongoing Return company on July 1, 2011 of Capital to Shareholders MPC Has Returned Nearly Repurchased $ 12 ~32 % Dividends Consistently growing dividend 26% CAGR since spin of Outstanding BILLION Common S
Slide 5: MPC Share Price Outperforms Peers
MPC Share Price Outperforms Peers First dropdown completed Announced incremental $3 B Update on strategic actions supporting $420 MM of share repurchase authorization; 1Q share repurchases $750 MM of 2Q activity 10% 0% (10%) Peer Index MPC (20%) 1Q 2017 2Q 2017 3Q 2017 Peer Index includes HollyFront
Slide 6: Executing Strategic Plan to Enhance Value
Executing Strategic Plan to Enhance Value Asset Dropdowns 1Q17 1st dropdown completed in March ~8x EBITDA multiple ~$250 MM annual EBITDA Share repurchases of $420 MM Expected ~$4.5 B after-tax cash proceeds from Announced incremental $3 B dropdowns and ~$1.2 B - $1.4 B annual MLP-qualifying EBITD
Slide 7: Strategic Plan to Enhance Shareholder Value
Strategic Plan to Enhance Shareholder Value Pro Forma Midstream Valuation (1)(2) (1)(3)(4) 2018E LP & GP distributions MPC receives from MPLX Total Midstream Value to MPC after Strategic Plan (6) (4) (4)(7) (7) MPLX Cost of Equity(5) Illustrative gross value per MPC share 2016: 8.3% 2018E Pro Forma:
Slide 8: MPLX - Key Investment Highlights
MPLX - Key Investment Highlights Diversified large-cap MLP positioned to deliver attractive returns over the long term Forecast distribution growth of 12% to 15% for 2017, double-digit for 2018 Gathering & • Largest processor and fractionator in the Marcellus/Utica basins Processing • Strong footpri
Slide 9: Delivering Consistent Growth in EBITDA and DCF
MPLX - Delivering Consistent Growth in EBITDA and DCF 59% increase in EBITDA since MarkWest acquisition 70% increase in DCF while maintaining strong coverage ratio 500 474 1.50 423 400 375 391 1.40 351 Coverage Ratio 298 302 $MM 300 1.30 200 387 1.20 354 285 301 318 100 227 236 1.10 0 1.00 4Q15* 1Q1
Slide 10: MPLX - 2017 Priorities and Strategy
MPLX - 2017 Priorities and Strategy Gathering & Processing Logistics & Storage Executed strategic agreements to Completed multiple acquisitions support continued long-term growth in – Terminal, pipeline and storage assets from Marcellus rich gas areas sponsor, MPC – Range Resources in Pennsylvan
Slide 11: Speedway
Speedway Serving More Than 2 Million Customers Every Day High Quality • Largest company-owned and -operated c-store chain east of Mississippi Network of Retail • Sold ~6 B gallons of transportation fuels and $5 B in merchandise in 2016 Locations • 2017 planned investments of ~$380 MM • #1 in EBITDA/
Slide 12: Speedway – Top-tier Performer
Speedway – Top-tier Performer Generates predictable, stable cash flows #1 in EBITDA/store/month vs. public peers 30 EBITDA 20 10 $M/store/month - Speedway Murphy USA Casey's Couche-Tard Sunoco CST Alon USA Western Refining 100 Total Margin 75 50 25 - Sunoco Speedway Casey's Couche-Tard CST Murph
Slide 13: Speedway Exceeding Expected Acquisition-related Synergies
Speedway Exceeding Expected Acquisition-related Synergies Continuing to focus on marketing enhancement opportunities 2016 actual synergies of $180 MM exceeded prior projection Synergies and Marketing Enhancements 250 225 200 190 180 149 $MM 150 120 100 75 47 50 20 0 2014E 2014 2015E 2015 2016E 2
Slide 14: Speedway – Focus on LPBE
Speedway – Focus on LPBE 12.39 Each 1.00 cent per 12 gallon improvement = ~$60 MM annual 10 pretax earnings Light Product Break Even (cpg) 8 7.35 Measure of operating efficiency and 6 merchandise contribution to total 5.41 expense 4 ~26% Potential to drive substantial value in the 2.56 reduction
Slide 15: 2017 Macro Outlook
2017 Macro Outlook U.S. macro picture remains solid – Expect good underlying domestic and export demand for refined products – Distillate demand expected to benefit from increased commercial activity – Gasoline demand expected to be similar to 2016 despite modest start OPEC’s resolve to reduce i
Slide 16: Sustained Global Demand Growth
Sustained Global Demand Growth Expect global oil demand growth to be sustained near Global Oil Demand 115 2.0 current levels Global Oil & Liquids Demand (MMBD) YOY Demand Growth (MMBD) Rising global population and 110 living standards propel fuel 1.5 105 demand Nonfuel uses such as 100 1.0 pet
Slide 17: U.S. Product Exports Will Help Meet Global Demand
U.S. Product Exports Will Help Meet Global Demand EIA’s 2017 Annual Energy EIA Annual Energy Outlook Product Exports Outlook 8 – Projects growth in U.S. product exports including gasoline, 7 diesel and propane 6 – U.S. refining expected to 5 MMBD remain highly competitive in the future 4 MPC vie
Slide 18: U.S. Refiners Have Sustained Export Advantages
U.S. Refiners Have Sustained Export Advantages Lower-cost natural gas Large, complex refineries 2016 Region Utilization Access to lower-cost feedstocks Rate(1) High utilization rates North America 85% Sophisticated workforce MPC 95% Natural Gas Price Comparison Asia 85% 18 European Natural
Slide 19: Export Market Remains Robust
Export Market Remains Robust Demand from Latin America remains MPC Export Capacity 600 strong for both diesel and gasoline 510 While arbitrage to Europe for diesel is not 500 115 always open, occasional opportunities 395 400 365 into Europe 320 345 MBPD Expanding export capacity at Galveston 3
Slide 20: Industry-leading Refining Network
Industry-leading Refining Network High-quality, • Third-largest U.S. refiner linked to extensive logistics and retail network Strategically Located • Process wide range of crude oils, feedstocks and condensate ranging Refineries from two-thirds heavy sour to two-thirds light sweet crudes • Peer-lead
Slide 21: Continuous Peer-leading Refining Performance
Continuous Peer-leading Refining Performance Based on Solomon Associates Benchmarking Study Operating Expenses Energy Efficiency Return on Investment Higher Return Less Efficient Higher Cost 2014 2016 2014 2016 2014 2016 MPC Merchant Group US Avg MPC Merchant Group US Avg MPC Merchant Group US Avg 2
Slide 22: Refining & Marketing Margin Enhancing Investments
Refining & Marketing Margin Enhancing Investments ~$275 MM planned in 2017 Estimated returns in excess of 20% STAR (South Texas Asset Repositioning program) – Increase residual oil (resid) processing • Expand resid hydrocracker • Improve gas oil recovery – Revamp crude unit • Increase distillate a
Slide 23: Strong Liquidity and Capitalization
Strong Liquidity and Capitalization As of June 30, 2017 MPC Committed to maintaining investment- MPC MPLX Excluding Consolidated Adjustments(a) grade credit profiles at MPC and ($MM except ratio data) MPLX MPLX Debt 12,606 6,667 5,939 Substantial available liquidity at MPC Mezzanine equity 1,000
Slide 24: Our Priorities for Value Creation
Our Priorities for Value Creation Maintain Top-tier Safety and Environmental performance Execute Strategic Actions to Enhance Value for Investors Increase Capital Return to Shareholders Grow Higher Valued and Stable Cash-flow businesses Enhance Margins for our Refining operations 24
Slide 25: Appendix
Appendix 25
Slide 26: Strong Operational Performance and Responsible Corporate Leadership
Strong Operational Performance and Responsible Corporate Leadership 26
Slide 27: Operating Income per Barrel of Crude Throughput
Operating Income per Barrel of Crude Throughput* MPC’s Rank 20 MPC’s Rank during periods of strong West Coast margins** 15 Competitor Range 1 2 10 $/BBL 2 5 1 3 6 1 3 2 5 2 7 3 3 3 3 1 3 6 2 0 -5 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Mar.
Slide 28: 2017 Capital Outlook
2017 Capital Outlook Excluding Acquisitions 10% 3% Speedway Corporate & Other MPC excluding MPLX ~$1.6 B Refining & Marketing (R&M) – $1,085 MM Midstream – $65 MM 22% Speedway – $380 MM R&M Sustaining Corporate & Other – $100 MM 56% Capital MPLX MPLX ~$2.1 B 7% R&M Margin Growth – $1,900 M
Slide 29: About MPLX
About MPLX Growth-oriented, diversified MLP with high-quality, strategically located assets with leading midstream position Two primary businesses – Logistics & Storage includes transportation, storage and distribution of crude oil, refined petroleum products and other hydrocarbon-based products
Slide 30: MPLX and MPC are Aligned
MPLX and MPC are Aligned MPLX Organizational Structure MPC views MPLX as integral to its Marathon Petroleum Corporation and Affiliates operations and is aligned with its (NYSE: MPC) success and incentivized to grow 100% interest 24% LP interest Public* MPLX Preferred MPLX GP LLC MPC owns 24% LP
Slide 31: MPLX - Robust Organic Growth Opportunities
MPLX - Robust Organic Growth Opportunities Forecast organic capital of $1.8 B to $2.0 B for 2017* Organic Growth Capital Investment G&P Segment ~5% Assets recently placed in service Utica – 60 MBPD fractionation train at Hopedale (1Q17) ~50% – Sherwood VII processing plant (1Q17) Marcellus – Sherw
Slide 32: MPLX - 2017 Forecast Update
MPLX - 2017 Forecast Update $50 million increase to earnings-related guidance 12%-15% distribution growth in 2017; double-digit distribution growth in 2018 Forecast, excluding future dropdowns: Financial Measure 2017 Forecast Net Income $600 MM - $750 MM Adjusted EBITDA(a) $1.75 B - $1.9 B Net c
Slide 33: MPLX - Growth Capital Forecast (2017)
MPLX - Growth Capital Forecast Projects expected to be completed in 2017 Est. Completion Completion Gathering & Processing Projects Shale Resource Capacity Logistics & Storage Projects Date Date Rich- and Dry-Gas Gathering(a) Marcellus & Utica N/A Ongoing Harpster-to-Lima pipeline and In Service – r
Slide 34: MPLX - Growth Capital Forecast (2018)
MPLX - Growth Capital Forecast Projects expected to be completed in 2018 Est. Completion Est. Gathering & Processing Projects Shale Resource Capacity Date Logistics & Storage Projects Completion Date Houston I Processing Plant(a) Marcellus 200 MMcf/d 1Q18 Ozark Pipeline Expansion 2Q18 Sherwood IX Pr
Slide 35: MPLX - Attractive Portfolio of Organic Growth Capital
MPLX - Attractive Portfolio of Organic Growth Capital Logistics & Storage Segment Midwest Pipeline Infrastructure Build-out Industry solution for Marcellus and Utica liquids 2017 estimated completion Ozark Pipeline Expansion Crude sourcing optionality to Midwest refineries 2Q 2018 estimated
Slide 36: MPLX - Executing a Comprehensive Utica Strategy
MPLX - Executing a Comprehensive Utica Strategy Phased Infrastructure Investment Cornerstone Pipeline commenced operations in October 2016 Hopedale pipeline connection completed December 2016 Harpster-to-Lima pipeline fully operational in July Links Marcellus and Utica condensate and natural
Slide 37: MPC Assets Expected to be Acquired by MPLX
MPC Assets Expected to be Acquired by MPLX ~$1.4 B of Estimated Annual EBITDA Refinery Fuels Terminals Pipelines Marine Logistics Distribution ● 62 light product; ● Private carrier crude ● Equity in 50/50 blue- ● ~55 MMBBL storage ● Fixed service fee per ~24 MMBBL storage; oil and refined product wa
Slide 38: Completed First-quarter Dropdown to MPLX
Completed First-quarter Dropdown to MPLX Terminal, pipeline and storage assets Total consideration of $2.015 B – 62 light product terminals with ~24 million barrels of – $1.511 B in cash and $504 MM in MPLX equity storage capacity – Represents ~8 times EBITDA multiple – 11 pipeline systems consi
Slide 39: Fuels Distribution Business Model
Fuels Distribution Business Model Marketing Model Marketing Model Services Model (Wholesale Distribution) (Rack-to-Retail) – MPC outsources fuels marketing – Purchase MPC’s marketing – Precedent models purchase, market, services to MPLX for those same businesses and transport fuel from independent s
Slide 40: MPLX - Logistics & Storage
MPLX - Logistics & Storage Segment Overview High-quality, well-maintained assets that are integral to MPC – Owns, leases or has interest in ~3,500 miles of crude oil pipelines and ~2,400 miles of product pipelines – 62 light-product terminals with ~24 million barrels of storage capacity – Barge do
Slide 41: MPLX - Recently Announced Pipeline Acquisitions
MPLX - Recently Announced Pipeline Acquisitions Extending the Footprint of the L&S Segment OzarkBakken PipelinePipeline Acquisition – $500 MM investment – ~9.2% equity interest in the Dakota Access Pipeline (DAPL) and the Energy Transfer Crude Oil Pipeline (ETCOP) projects – Expected to deliver ~520
Slide 42: MPLX - Gathering & Processing
MPLX - Gathering & Processing Segment Overview • Ethane Raw Gathering • Propane Processing Mixed Fractionation NGL Natural Gas and • Normal Butane Plants NGLs Facilities Products • Isobutane Production Compression • Natural Gasoline One of the largest NGL and natural gas midstream service provider
Slide 43: Marcellus/Utica Resource Play is the Leading U.S. Natural Gas Growth Play
The Marcellus/Utica Resource Play is the Leading U.S. Natural Gas Growth Play 87 35 Marcellus & Utica account for over 25% of Rest of U.S. – Billion Cubic Feet per Day (Bcf/d) Marcellus & Utica – Billion Cubic Feet per Day Marcellus & Utica 83 total U.S. gas supply today and are expected 31 to grow
Slide 44: Marcellus/Utica Processing Capacity
MPLX - Marcellus/Utica Processing Capacity Building infrastructure to support basin volume growth Currently operate ~66% of processing capacity in Marcellus/Utica Basin 8 ~7.0 Bcf/d processing capacity by end of 2018 2017 expected plant completions 6 Sherwood VII (in service 1Q17) Sherwood VIII (in
Slide 45: Marcellus/Utica Fractionation Capacity
MPLX – Marcellus/Utica Fractionation Capacity Building infrastructure to support growing C2 and C3+ demand Currently operate ~55% of fractionation capacity in Marcellus/Utica Basin 600 ~571 MBPD processing capacity by end of 2018 500 2017 expected plant completions Hopedale III C3+ (in service 1Q17)
Slide 46: MPLX - Strengthens Leading Position in Northeast
MPLX - Strengthens Leading Position in Northeast Recently announced 50/50 joint venture with Antero Midstream Supports Antero Resources’ significant PENNSYLVANIA production growth profile in the Marcellus Shale OHIO – Long-term, fee-based agreement and significant acreage dedication HOPEDALE Com
Slide 47: MPLX - Northeast Operations Well-Positioned in Ethane Market
MPLX - Northeast Operations Well-Positioned in Ethane Market Ethane demand growing as exports and Ohio steam cracker development continues in Pennsylvania Gulf Coast and Northeast Bluestone MPLX well-positioned to support producer customers’ rich-gas Harmon Creek development with extensive distr
Slide 48: Major Residue Gas Takeaway Expansion Projects Originate at MPLX Facilities
Major Residue Gas Takeaway Expansion Projects Originate at MPLX Facilities New takeaway pipelines expected to improve Northeast basis differentials MPLX processing complexes: – Access to all major residue gas takeaway pipelines – Provide multiple options with significant excess residue capacity
Slide 49: MPLX - Marcellus/Utica Overview
MPLX - Marcellus/Utica Overview 3.5 Bcf/d Gathering, 5.8 Bcf/d Processing & 491 MBPD C2+ Fractionation Capacity HOPEDALE FRACTIONATION COMPLEX BLUESTONE COMPLEX PENNSYLVANIA HARMON CREEK COMPLEX (currently under construction) OHIO HOUSTON COMPLEX MarkWest Joint Venture with EMG OHIO CONDENSATE MarkW
Slide 50: MPLX - Gathering & Processing: Marcellus & Utica Operations
MPLX - Gathering & Processing Marcellus & Utica Operations Processed Volumes Record processed volumes averaged approximately 4.7 Bcf/d Available Average Utilization Area Capacity Volume Commenced operations of (MMcf/d)(a) (MMcf/d) (%) Sherwood VIII in July Marcellus 4,320 3,811 88% 2017 proces
Slide 51: MPLX - Gathering & Processing: Marcellus & Utica Fractionation
MPLX - Gathering & Processing Marcellus & Utica Fractionation 2017 fractionated volumes Fractionated Volumes expected to increase ~15% Available Average Utilization to ~20% over prior year Area Capacity Volume (%) (MBPD)(a)(b) (MBPD) Commenced operation of second fractionation train at Bluestone
Slide 52: Considerable Scale in the Southwest
MPLX - Considerable Scale in the Southwest 2.6 Bcf/d Gathering, 1.5 Bcf/d Processing & 29 MBPD C2+ Fractionation Capacity Western Oklahoma Processing Oklahoma Southeast Oklahoma Processing* 425MMcf/d 120MMcf/d Gathering Gathering 585MMcf/d 1,205MMcf/d *Represents 40% of processing capacity through t
Slide 53: MPLX - Expanding Southwest Position
MPLX - Expanding Southwest Position to Support Growing Production in High Performance Resource Plays Cana-Woodford Permian Hidalgo Complex 200 MMcf/d Eddy Permian Arapaho Complex Basin Blaine Kingfisher Dewey Rich-gas Newfield Argo Complex Delaware pipeline STACK 200 MMcf/d – Q1 2018 Basin Roger Mil
Slide 54: MPLX - Gathering & Processing: Southwest Operations
MPLX - Gathering & Processing Southwest Operations Processed Volumes Began construction of gas processing plant in the STACK Available Average Utilization Area Capacity Volume shale (Omega) expected to be in- (MMcf/d)(a) (MMcf/d) (%) service in mid-2018 West Texas(b) 200 199 100% 2017 processed
Slide 55: MPLX - Logistics & Storage Contract Structure
MPLX - Logistics & Storage Contract Structure Fee-based assets with minimal commodity 2016 Revenue – Customer Mix exposure(c) 6% MPC has historically accounted for $51 – over 85% of the volumes shipped on MPLX’s 20% MM crude and product pipelines – 100% of the volumes transported via MPLX’s $171
Slide 56: MPLX - Gathering & Processing Contract Structure
MPLX - Gathering & Processing Contract Structure Durable long-term partnerships across leading basins Marcellus Utica Southwest Resource Play Marcellus, Upper Devonian Utica Haynesville, Cotton Valley, Woodford, Anadarko Basin, Granite Wash, Cana-Woodford, Permian, Eagle Ford Producers 14 – includin
Slide 57: MPLX - Commodity Price Sensitivities
MPLX - Commodity Price Sensitivities 95% fee-based net operating margin, 5% commodity exposure for 2017 Maintain active hedging program with ~40% of our 2017 commodity exposure currently hedged Annual 2017 sensitivities to commodity price changes (assumes no hedges): Product Commodity Price Ch
Slide 58: MPLX - Strong Financial Flexibility to Manage and Grow Asset Base
MPLX - Strong Financial Flexibility to Manage and Grow Asset Base Committed to maintaining ($MM except ratio data) As of 6/30/17 investment grade credit profile Cash and cash equivalents 293 $2.25 B senior notes issued Total assets 18,601 1Q 2017 Total debt 6,667 Completed $434 MM of Redeemabl
Slide 59: MPLX - Long-Term Value Objectives
MPLX - Long-Term Value Objectives Deliver Sustainable Distribution Growth rate that provides attractive total unitholder returns Drive Lower Cost of Capital to achieve most efficient mix of growth and yield Develop Backlog of Organic Growth Projects benefiting producer customers and overall en
Slide 60: Speedway Retail Network
Speedway Retail Network 64 235 12 304 113 115 309 487 60 Conn. Del. 1 4 Speedway 147 62 Mass. 113 Largest company-owned 39 278 N.J. 71 and -operated c-store chain 52 R.I. 20 2 east of the Mississippi ~2,730 locations in 21 states 241 As of June 30, 2017 60
Slide 61: 2017 Speedway Capital Investment Plan
2017 Speedway Capital Investment Plan Planned investments of ~$380 MM – Build new stores and remodel and rebuild existing retail locations in core markets Delivered on goals for acquired locations – Expect to complete remodel plan in 2017 – Planned investments achieved under budget and ahead of
Slide 62: Speedway: Overview of Hess retail acquisition
Speedway Overview of Hess retail acquisition Transaction closed on September 30, 2014 1,245 company operated locations Transport fleet with capacity to transport ~1 billion gal/yr. Pipeline shipper history in various pipelines, including ~40 MBPD on Colonial Pipeline Prime undeveloped real
Slide 63: Speedy Rewards Loyalty Program
® Speedy Rewards Loyalty Program Highly successful loyalty program Customers earn points on every purchase Customers redeem points for free merchandise and fuel discounts Averaged more than 5.7 million active Speedy Rewards members in 2016, and continues to grow as we attract new members in
Slide 64: Private Label Products
Private Label Products Higher Sales and Margins Better Value Proposition For Consumers Promotes Brand Awareness and Loyalty Differentiation From Competitors 64
Slide 65: Speedway Strong and Consistent Growth
Speedway Strong and Consistent Growth Gasoline and Distillate Sales Volume 8,000 Merchandise Sales/Gross Margin MM Gallons 6,000 30 6,000 6,038 6,094 5,007 4,879 29 4,000 3,942 2,000 3,027 3,146 4,000 28 3,611 Percent 3,058 3,135 $MM 0 27 2012 2013 2014 2015 2016 2,000 26 Gasoline and Distillate Gro
Slide 66: Balance in Refining Network
Balance in Refining Network BPCD NCI Canton (Ohio) 93,000 7.8 Catlettsburg (Ky.) 273,000 9.3 Detroit (Mich.) 132,000 9.9 Midwest Capacity 729,000 BPCD Robinson (Ill.) 231,000 9.8 Galveston Bay (Texas) 459,000 13.0 Texas City (Texas) 86,000 7.8 Garyville (La.) 543,000 11.2 Total 1,817,000 10.7* The N
Slide 67: Key Strengths
Key Strengths Balanced Operations Crude Oil Refining Capacity Crude Slate 60% PADD II 62% Sour Crude PADD III 38% 40% Sweet Crude As of June 30, 2017 2Q 2017 Assured Sales of Gasoline Production (Speedway + Brand + Wholesale Contract Sales) Assured Sales ~70% ~30% Wholesale and Other Sales 2Q 2017 6
Slide 68: OPEC's Resolve to Reduce Inventory Levels
OPEC’s Resolve to Reduce Inventory Levels Source: EIA Expect progress toward rebalancing in 2H 2017 but not completed until 2018 68
Slide 69: U.S. Macro Picture Remains Solid
U.S. Macro Picture Remains Solid Expect good underlying domestic and export demand for refined products Gasoline Demand (MMBD) Distillate Demand (MMBD) 9.8 4.6 9.6 4.4 9.4 4.2 9.2 4.0 9.0 3.8 8.8 3.6 8.6 8.4 3.4 J F M A M J J A S O N D J F M A M J J A S O N D 2015 2016 2017 2015 2016 2017 Source: EI
Slide 70: Gasoline Exports Enhance Utilization
Gasoline Exports Enhance Utilization U.S. Total Gross Gasoline Exports Gasoline exports have expanded 1100 opportunity set for U.S. refiners 900 2014 MBPD – Summer exports tend to fall as more 700 2015 product is consumed domestically 500 2016 2017 300 U.S. refinery utilization is less subject t
Slide 71: Distillate Leading World Liquids Demand
Distillate Leading World Liquids Demand Average Annual 120 Volumetric Growth (MBPD) Actual Forecast 2015 vs. 2025 Average product 100 demand growth +440 80 of 1.6 MMBD in Other 2016-2017 -125 MMBPD 60 Resid Distillate remains +550 the growth leader 40 Middle Distillate through 2025 20 Global g
Slide 72: Distillate Leads U.S. Domestic Petroleum Fuels Demand
Distillate Leads U.S. Domestic Petroleum Fuels Demand 10 Compounded Annual Gasoline Actual Forecast Growth Rates Distillate expected to lead 9 2016 vs. 2030 U.S. domestic fuels demand 8 -0.8% growth Gasoline ex ethanol 7 -0.8% – Primarily due to growth in 6 freight transportation and MMBPD 5 subst
Slide 73: Galveston Bay-Texas City World-Class Refining Complex
Galveston Bay-Texas City World-Class Refining Complex Galveston Bay and Texas City refineries consolidated operations in mid-2017 Galveston Bay-Texas City BPCD* Crude 585,000 Resid Processing 142,100 Catalytic Cracking/Hydrocracking 258,400 Alkylation 52,800 Aromatics 33,800 *MPC estimates post-STAR
Slide 74: ENERGY STAR Program
ENERGY STAR Program ® ENERGY STAR labels for refining EPA ENERGY STAR History as of 6-15-16 Operating Year ---> 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 industry began in 2006 EPA Certification Year ---> 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 47 labels awarded durin
Slide 75: MPLX - Adjusted EBITDA and DCF Reconciliation from Net Income
MPLX - Adjusted EBITDA and Distributable Cash Flow Reconciliation from Net Income ($MM) 2013 2014 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 2Q 2017 Net income (loss) 211 239 333 (14) 72 194 182 187 191 Depreciation and amortization 70 75 129 136 151 151 153 187 164 Provision (benefit) for income
Slide 76: MPLX - Reconciliation from Net Cash Provided by Operating Activities
MPLX - Reconciliation of Adjusted EBITDA and Distributable Cash from Net Cash Provided by Operating Activities ($MM) 2Q 2017 2Q 2016 YTD 2017 YTD 2016 Net cash provided by operating activities 467 349 844 670 Changes in working capital items (50) 4 1 (9) All other, net (16) (5) (32) (22) Non-cash eq
Slide 77: MPLX 2017 Forecast - Reconciliation from Net Income
MPLX 2017 Forecast - Adjusted EBITDA and Distributable Cash Flow Reconciliation from Net Income ($MM) Low High Net income 600 750 Depreciation and amortization 690 690 Net interest and other financial costs 380 380 Adjustment for equity investment earnings & distributions 110 110 Unrealized derivati
Slide 78: MPLX 2017 Forecast - Reconciliation from Operating Cash Flow
MPLX 2017 Forecast - Adjusted EBITDA and Distributable Cash Flow Reconciliation from Net Cash Provided by Operating Activities ($MM) Low High Net cash provided by operating activities 1,450 1,600 Changes in working capital items 45 45 All other, net (70) (70) Non-cash equity based compensation 15 15
Slide 79: MPC Reconciliation
MPC Reconciliation Adjusted EBITDA to Net Income Attributable to MPC ($MM) 2016 2017 LTM 3Q 4Q 1Q 2Q Net Income attributable to MPC 145 227 30 483 885 Less: Net interest and other financial income (costs) (141) (136) (150) (158) (585) Add: Net income (loss) attributable to inco noncontrolling intere
Slide 80: Reconciliation
Reconciliation MPC Adjusted EBITDA Related to MPLX to MPLX Net Income(a) ($MM) 2016 2017 LTM 3Q 4Q 1Q 2Q MPLX Net Income 194 182 187 191 754 Less: Net interest and other financial income (costs) (64) (65) (78) (87) (294) Add: Provision for income taxes - - - 2 2 Depreciation and amortization 151 153
Slide 81: Speedway Reconciliation
Speedway Reconciliation Segment EBITDA to Segment Income from Operations ($MM) 2016 Speedway Segment Income from Operations 734 Plus: Depreciation and Amortization 273 Speedway Segment EBITDA 1,007 81
Slide 82: MPC Annual Price and Margin Sensitivities
MPC Annual Price and Margin Sensitivities Refining and Marketing Segment $MM (After Tax) LLS 6-3-2-1 Crack Spread* Sensitivity ~$450 (per $1.00/barrel change) Sweet/Sour Differential** Sensitivity ~$225 (per $1.00/barrel change) LLS-WTI Spread*** Sensitivity ~$80 (per $1.00/barrel change) Natural Ga
Slide 83: MPC's Fully Integrated Downstream System
MPC’s Fully Integrated Downstream System Refining and Marketing Seven-plant refining system with ~1.8 MMBPCD capacity One biodiesel facility and interest in three ethanol facilities One of the largest wholesale suppliers in our market area One of the largest producers of asphalt in the U.S.
Marathon Petroleum — Investor Presentation (August 2017) on 6ix