THE RECENT rout in global oil prices has led to Marathon Petroleum making the decision to defer its anticipated residual oil upgrader expansion (ROUX) project at its Garyville refinery.
Chief executive officer Gary Heminger cited current market conditions for deferral of the expansion at the 522,000-barrel-per-day Louisiana refinery, despite claiming the company still believes the project has great potential returns.
“We believe this project has great potential returns, but we are deferring a final investment decision as we further evaluate the implications of current market conditions on the project.” Despite the project deferrals, the oil refiner reported profit growth in the final quarter.
The company yesterday reported 2014 fourth-quarter profits of $798m (£524m), or $2.86 per diluted share, compared with $626m, or $2.07 per diluted share, in the fourth quarter of 2013. Full-year profits for 2014 were $2.52bn, or $8.78 per diluted share, compared with $2.11bn, or $6.64 per diluted share in 2013.
“Our flexible refining system, large retail presence and extensive logistics network allowed us to successfully adapt to changing production and supply patterns,” Heminger added.
The news follows the company’s announcement yesterday of a $2.5bn capital investment plan for 2015 with $1.3bn dedicated to refining and marketing and a further $660m committed to upgrading its pipeline infrastructure.
The company said it was still committed to upgrading the connectivity between its Texas City and Galveston Bay refineries in order to gain greater synergy between its two Gulf Coast refineries.
Marathon is the fourth-largest refiner in the US and shares in the company fell 0.11 per cent to $95.71 yesterday.