Marathon Oil

In: Business and Management

Submitted By lawrence30
Words 1480
Pages 6
1

The relationship between the retail price of gasoline and the world demand for crude oil.
Marathon is among the top five crude oil refineries in the United States. It’s an integrated international energy company engaged in exploration and production of oil, sand mining, integrated gas, refining, marketing, and transportation operation. Marathon needs to upgrade a few of their refineries and pipelines in order to increase the production process of heavy crude oils, (marathon.com). For example, once the Detroit Heavy Oil Upgrade Project is completed, the refinery crude capacity will increase from 106,000 bpd to 115,000 bpd. The upgrades will allow the Detroit refinery to process an additional 80,000 barrels of heavy crude oil per day (detriothoup.com). The existing pipelines at the Detroit refinery do not have the capacity to transport additional volumes of crude oil to meet the refinery’s upgrade needs. Therefore a 1.5-mile pipeline will provide an alternative oil supply line to the refinery and provide extra security in the event of a supply disruption. Pipelines are the safest and the most efficient way to transport crude oil and other liquid petroleum products. They reduce traffic and pollution as well as provide economic benefits. Pipelines transport two-thirds of all the crude oil and refined products in the U.S. compared to three percent by tanker trucks. According to detriothoup.com, currently 100,000 barrels of crude per day are transport to the refinery. Transporting the same volume of oil by tanker truck would require between 400 to 500 shipments per refinery day which would be a logistical nightmare and is not cost efficient for any company. In order to remain competitive, Marathon must continue to invest in new and improved equipment and methods to increase productivity and upgrading refineries and pipelines is definitely one way to improve…...

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