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Marathon Oil Plans $3.2 Billion Expansion of Garyville, La., Refinery.

ENERGY RESOURCE-7 November 2006-Marathon Oil Plans $3.2 Billion Expansion of Garyville, La., Refinery(C)2006 JeraOne - http://www.jeraone.com

Marathon Oil Corporation today said its board of directors has approved an estimated $3.2 billion project that will expand the crude oil refining capacity of the company's Garyville, La., refinery by 180,000 barrels per day (bpd).

The project will increase Garyville's refining capacity from 245,000 bpd to 425,000 bpd and Marathon's total refining capacity from 974,000 bpd to 1,154,000 bpd. The expansion is subject to obtaining necessary permits from applicable regulatory agencies.

Marathon said the new facilities, located in Louisiana's St. John the Baptist Parish, will incorporate the latest safety and environmental control technologies at the refinery, which is the first and only refinery to be included in the U.S. EPA's elite National Environmental Performance Track (NEPT). Marathon's Garyville refinery was also one of the first refineries to achieve OSHA's Voluntary Protection Program (VPP) Star designation.

"The Garyville expansion is an example of Marathon's commitment to making superior investment decisions for our shareholders while building energy infrastructure that will supply the growing needs of consumers in the markets we serve," said Clarence P. Cazalot Jr., Marathon president and CEO.

"This project will build on Garyville's best-in-class ranking by utilizing shared infrastructure and capturing synergies between the existing facilities and those that are part of this expansion," Cazalot said.

Completed in 1976, the Garyville refinery is the last grassroots refinery constructed in the U.S. and has consistently been ranked as one of the most efficient refineries in the nation.

In addition to the installation of a new crude and vacuum distillation unit, expansion plans call for the construction of infrastructure and other process units with the following design capacities: a 44,000 bpd delayed coker, a 70,000 bpd heavy gas oil hydrocracker, a 65,000 bpd reformer and a 47,000 bpd kerosene hydrotreater.

"The Garyville expansion project will help our country meet its growing energy needs by providing an additional 7.5 million gallons of clean transportation fuels to the market each day, while also benefiting the Louisiana economy at a critical time," said Gary R. Heminger, executive vice president of Marathon and president of the company's refining, marketing and transportation operations. "As with all Marathon operations, our first priority is operating safely and in an environmentally sound manner. We also are committed to keeping all interested parties informed and updated as we move forward with this important project."

Marathon expects the completed expansion will add approximately 180 to 200 new full-time employees and 50-70 new full-time contract employees. The construction phase will require an average of 2,000 workers, with up to 4,000 workers at peak periods.

St. John the Baptist Parish will receive between $40-50 million in sales and use taxes during the project construction, said Marathon.

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Publication:Energy Resource
Date:Nov 7, 2006
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