Marathon Petroleum’s refinery in Canton, Ohio, will be on the receiving end of the company’s new 49-mile pipeline that will transport shale liquids from eastern Ohio.
MARATHON PETROLEUM GROUP Enlarge
AKRON — Marathon Petroleum Corp. is proceeding with a new 49-mile pipeline from the Utica shale in eastern Ohio to its refinery in Canton.
The Findlay company discussed the $140 million pipeline to transport shale liquids in a conference call with financial analysts this week.
The pipeline project is part of a long-range plan by the company to grow its midstream and retail segments to help balance the volatility of its refining segment.
“We recognize that earnings volatility is an issue for long-term investors, and we are addressing that by growing more aggressively the segments of our business that produce more stable cash flows,” said Gary Heminger, Marathon Petroleum’s chief executive officer.
The Cornerstone Pipeline, as it is being called, will connect natural gas-processing plants and liquids fractionation plants in Harrison and Carroll counties west to the refinery.
The line, eight inches in diameter, could transport about 40 million barrels per day. Marathon hopes to begin construction in early 2016 and have it be operational by late 2016, he said.
The project is part of an effort to boost the company’s position as the largest refiner in the Utica shale area of eastern Ohio and to gain greater access to the Utica shale play.
“We’re in the best position of any party to take advantage of this locally produced crude oil and condensate and are positioning ourselves for our future growth,” spokesman C. Michael Palmer said.
The pipeline will be developed by MPLX LP, a master limited partnership that was spun off from Marathon Petroleum last year and is overseen by the same management team.
The new pipeline is designed to carry crude oil, condensate, and natural gasoline, said company spokesman Garry Pfeiffer.
The Cornerstone Pipeline may be used by Marathon to ship the Utica shale liquids to other refineries in the future, Mr. Pfeiffer said.
As the volume of liquids from the Utica shale grows, Marathon said it will be unable to process all of the condensate at its refineries in Canton and Cattlettsburg, Ky.
The company said it could look at shipping the excess liquids to refineries in western Ohio and into Canada for processing.
Marathon is also adding two condensate splitters that together cost $300 million to the refineries in Canton and Cattlettsburg.
Marathon is also expanding its truck unloading facilities in Canton and its truck-to-barge facilities in Wellsville, Ohio, on the Ohio River.
Guidelines: Please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. Comments that violate these standards, or our privacy statement or visitor's agreement, are subject to being removed and commenters are subject to being banned. To post comments, you must be a registered user on toledoblade.com. To find out more, please visit the FAQ.