Independent refiner, transporter and marketer firm
Marathon Petroleum Corporation
) along with partner Harvest Pipeline Company announced plans to
set up a truck-to-barge system on the Ohio River. In this regard,
both the companies signed a letter of intent (LOI) on September 27,
without disclosing any of the financial details.
MARATHON PETROL (MPC): Free Stock Analysis
MARATHON OIL CP (MRO): Free Stock Analysis
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This newly constructed facility will be utilized for the
transportation of oil and natural gas liquids produced in the Utica
shale oil play to refineries. Marathon stated that the project will
have trucks with daily capacity to transport about 24,000 barrels
and a terminal that can load up to 50,000 barrels of oil daily.
For this project, Marathon will have to upgrade its existing
Wellsville river terminal and built a new truck rack. The venture
is expected to be completed by the end of 2013.
With two of Marathon's refineries on top of the Utica shale
formation in eastern Ohio and western Pennsylvania, management
highlighted that the company is working toward bringing in more
liquids from the region.
Early this year, Marathon invested in constructing a new truck rack
of 12,000 barrels per day (bpd) capacity at Canton refinery, Ohio.
The capacity of the rack can be further expanded up to 24,000 bpd.
Findlay, Ohio-based Marathon Petroleum came into existence
following the 2011 spin-off of Houston, Texas-based
Marathon Oil Corporation
) refining/sales business into a separate, independent and publicly
traded entity. Marathon Petroleum operates in three segments:
Refining and Marketing, Speedway (Retail) and Pipeline
Marathon Petroleum currently retains a Zacks #2 Rank, which implies
a short-term Buy rating. We also have a long-term Outperform
recommendation on the stock.
We like Marathon Petroleum's strong six-plant refining portfolio
and its diversification into retail/midstream business lines, which
make the stock potentially more stable. Additionally, the company
possesses one of the healthiest balance sheets among peers and a
robust free cash flow generating ability.