Challenging Ourselves to - Lead in Sustainable Energy - JANUARY 2022 - Marathon Petroleum Corporation
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JA N U A RY 2 0 2 2 Challenging Ourselves to Lead in Sustainable Energy
S U M M A RY
Challenging Ourselves to Lead in Sustainable Energy
Meeting the needs of today while investing in an energy-diverse future
Strengthen Resiliency
Strengthening our business for today, while building durability for tomorrow and beyond
• First independent U.S. downstream energy
First-ever petroleum refiner Largest natural gas processor in the
company to establish GHG emissions
2021 Diversified U.S. facilitating approximately 250
GAS
intensity target tied to compensation to have five refineries earn
COAL
million tonnes of CO2e reductions
• Targets to reduce methane emissions
U.S. EPA’s ENERGY STAR®
certifications in one year
Portfolio per year from coal to gas switching
intensity and freshwater withdrawal intensity within the power sector
Innovate for the Future
Investing in the energy evolution to lower carbon intensity and capture value
Martinez Renewable Fuels Dickinson Renewable Diesel Facility Pursuing Value Chain Opportunities to Lower Carbon Intensity
>40%
of 2021 planned
growth capital spend
730 million 184 million Producing a
~50% lower CO2e
gallons/year capacity gallons/year capacity
on renewables carbon intensity
60% reduction Second largest renewable Lower carbon Renewable Carbon capture Renewable Regenerative
in GHG emissions
compared to previous refinery operations
in the U.S. diesel feedstock energy utilization and natural gas agriculture
storage
Embed Sustainability
Embracing sustainability in decision-making, in how we engage our people and in how we create value with stakeholders
First independent U.S. Strong Safety Performance • Comprehensive approach to stakeholder No. 1 on S&P Global
downstream energy company to 40% reduction in Tier 1 and engagement across the company ESG Rating for U.S.
link Diversity, Equity and Inclusion Tier 2 refining process safety • Robust engagement with tribal Oil and Gas Refining
metric to compensation events since 2016 stakeholders in our operational footprint and Marketing sector
2
Strengthen
Resiliency
Strengthening our business for
today, while building durability for
tomorrow and beyond
We operate with an understanding of the potential
environmental impacts of our business. This
understanding informs our commitment to lower
the carbon intensity of our operations and the
products we manufacture, improve the energy
efficiency of our operations and advance practices
that conserve natural resources.
3
STRENGTHEN
RESILIENCY
Lowering our Carbon Intensity
Greenhouse Gas Emissions Focus on Energy Program
First independent U.S. downstream energy Risk-based ROI for major capital First independent U.S.
company to establish GHG emissions allocation includes GHG impacts downstream energy
30%
company to advance
intensity target tied to compensation
Energy and GHG management Scope 3, Category 11
• Reductions achieved through insetting, not incorporated into project design GHG transparency
Target: Reduce Scope
offsetting 1 and 2 GHG emissions
intensity 30% by 2030
• Tangible pathway to meet target from 2014 levels Avoided Full participation in
• Committed to evaluating and updating CDP long-form — a global
target as demand and technologies evolve
Progress
1.8 billion environmental disclosure
system — in 2021
BTU/hour in energy consumption
0% at 21% 30%
Recognized for Improved Energy Efficiency
Partner of the Year —
2021 fourth consecutive year
First-ever petroleum refiner Only downstream company Four MPLX terminals
to have five refineries earn to have the elite “Partner of achieved the U.S. EPA’s
U.S. EPA’s ENERGY STAR® SECOND CONSECUTIVE YEAR the Year” designation ENERGY STAR Challenge
certifications in one year for Industry award
4
STRENGTHEN
RESILIENCY
MPLX Midstream Resiliency
Natural Gas Gathering and Processing Natural Gas Lowers Positioned for Potential Conversions
IEA projects strong demand for natural
gas and natural gas liquids
~$20 Carbon Intensity
Provides baseload
for Renewable Products
Nationwide network tied to existing
• U.S. expected to supply 20-25% of billion stability for wind and solar and planned infrastructure
world’s natural gas through 2040
Natural Gas Demand Projections Through 2040
invested intermittency
Processing plants Transportation of
(billion cubic meters) since 2015 resulting MPLX helped Storage and export terminals renewable fuels,
2010 Actual in nearly 100% facilitate hydrogen and CO2
GAS
increase in natural Pipelines
approximately
COAL
2019 Actual
for sequestration
gas processing 250 million Marine and trucking
2030E
capacity tonnes of CO2e
2040E 43% of combined MPC reductions per
and MPLX production year from coal to ~10% of natural gas produced in the U.S. passes
0 1000 2000 3000 4000 5000 6000 attributable to lower-
Net Zero Emissions Stated Policies Sustainable
carbon natural gas gas switching in through our network
by 2050 case Scenario Development
Source: IEA, World Energy Outlook 2020
Scenario
the U.S.
Focus on Methane Tangible Pathway to Reduce Methane Emissions from Existing Assets
Lowering methane Target: Reduce midstream
emissions maximizes the
LDAR
50% methane emissions intensity
50% by 2025 from 2016 levels
climate benefits of natural
LEAK DETECTION
gas investments and AND REPAIR
increases revenue Implementing LDAR Replacing or Replacing Minimizing Optimizing
and optical gas converting gas- compressor emissions from maintenance
Newly constructed systems Progress imaging to identify driven pneumatic rod packing pipeline launchers venting
designed with lower potential 0% at 22% 50%
and repair leaks control valves and receivers
for methane emissions
5
STRENGTHEN
RESILIENCY
Conserving Natural Resources
Reduce Freshwater Focus on Water Program
Withdrawal 2020 FOCUS ON
One of the first U.S. downstream energy companies to launch a program to WATER PROGRAM
Reduce freshwater 20% RESULTS
track and reduce freshwater withdrawal intensity across all of our operations
withdrawal intensity
to increase resiliency Target: Reduce
Our recent water conservation efforts in the refining process include: 570 million
1 2 3
and reduce long-term freshwater withdrawal
Identifying gallons of fresh
operating costs intensity by 20% by 2030 Evaluating water
from 2016 levels Reducing overall opportunities for water saved
recycle and
alternative water
$2.6 million
water usage
74%
reuse options
sourcing
cost savings, first year
Progress MPLX gas processing plants are designed to use little to no water
of freshwater withdrawal from
at 9%
in their routine operations
0% 20%
nonwater-stressed areas
Reduce Waste Reduce Criteria Pollutant Emissions Biodiversity Commitment
Reduce waste generated by our operations Companywide Criteria Pollutant Emissions
From 2002 through 2020, (thousand tonnes) We implement a risk-
we have achieved a 2002 95 based process to avoid,
Since 2013, approximately
95,800 tonnes of waste from 2016 minimize and offset
54%
58
our refineries has become 2017 59 potential biodiversity
an alternative fuel source for 2018 54
impacts and engage
the cement industry, avoiding with community
approximately 230,000 tonnes reduction in criteria pollutant 2019 50
54% stakeholders.
of CO2e emissions. emissions while the footprint 2020 44 reduction
since 2002
of our refining and natural 0 20 40 60 80 100
gas assets expanded. Total SOx emissions
Total NOx emissions
Total VOC emissions
Total PM10 emissions
Total CO emissions
Total SOx emissions Total NOx emissions
6
Total CO emissions Total VOC emissions
Innovate for
the Future
Investing in the energy evolution
to lower carbon intensity and
capture value
We strive to be a market leader in the production
and delivery of renewable fuels, seek ways to
expand the use of renewable energy in our
operations, and deploy emerging technologies
that reduce environmental impact while
enhancing business performance.
7
I N N O V AT E F O R
THE FUTURE
Optimizing Low-Carbon Opportunities
Growing Demand for Lower-Carbon Intensity Energy Carbon Markets Drive Investment
MPC Renewable Fuels Production Increases 2019-2025
Our growing natural gas business is contributing to 2019 Policies to enable low carbon
GHG reductions – making an impact now solutions are critical
2020
Investing in renewables and emerging technologies 2021E • Technological developments and
to drive further reductions into the future 2022E policy frameworks supported by
2023E the right incentives will be needed
• Leveraging California’s $200
The IEA projects that demand 2024E
carbon price with investments in
for renewable fuels will grow 2025E
renewable diesel
by 3 to 5 million bpd from 0 200 400 600 800 1,000 1,200 1,400
• As low-carbon fuel programs
2 million through 2040 Cincinnati Biodiesel
Dickinson Renewable Diesel
Andersons/Marathon JV
Martinez Renewable Diesel
emerge in other jurisdictions, we
will rapidly evaluate opportunities
Allocating Capital Toward High-Return, Evaluating
Lower-Carbon Products Opportunities CO2e
Across the
• Renewable diesel (current) Value Chain
to Further
• Biodiesel (current) >40% Reduce Life
Lower Carbon Renewable Carbon Capture, Regenerative Renewable
Feedstocks Electricity Utilization and Agriculture Natural Gas
• Ethanol (current) Cycle Carbon Sequestration
• Sustainable aviation fuel Intensity Utilize waste oils Utilize wind (CCUS) Reduce GHG Utilize biogas
(exploring) and lower carbon and solar Utilize carbon capture emissions from
of 2021 planned seed oils systems and CO2 crop production and
• Plant-based chemical products growth capital spend sequestration increase carbon
(exploring) on renewables storage in soils
8
I N N O V AT E F O R
THE FUTURE
Renewables and Emerging Technologies
Current Portfolio
Ethanol — Joint Venture with
The Andersons, Inc.
Delivered Avoided nearly ~421,000 tonnes Produced
of CO2 captured
industrial
applications
~475
million
~2.1 billion 9 million annually from
MPC operations
gallons in 2020
food and beverage >1.8 billion gallons
gallons of renewable tonnes of customers’ CO2 industry
fuels to consumers in 2020 transportations emissions in 2020
and joint ventures ethanol blended into
gasoline marketed and
sold in 2020
Virent — Wholly Owned
Subsidiary
Dickinson Renewable Diesel Facility Advanced biofuel and
Madison,
renewable chemical Wisconsin
Lower Carbon Intensity research, development
and commercialization
• Producing a renewable diesel that has ~50% lower carbon intensity than diesel derived from fossil fuels
• Progressing renewable electricity, carbon capture, utilization and sequestration (CCUS) and regenerative
agriculture at Dickinson with potential to produce net-zero fuel
Cincinnati Biodiesel Facility
Second
Produced
184 Renewable ~80 million
Dickinson, million largest Diesel and
Naphtha
gallons of biodiesel in 2020
North Dakota gallons/year capacity in the U.S. Carbon intensity of biodiesel is 70% lower than
diesel fuel derived from fossil fuels
9
I N N O V AT E F O R
THE FUTURE
Renewables and Emerging Technologies
Expanding Our Portfolio
MPC’s Renewable Fuels Production Martinez Renewable Fuels Facility Conversion Underway:
Over the next five 730 60% • Rigorous approach to
years, we expect to
increase renewable
Martinez,
California
million reduction* permitting
• Progressing engineering
gallons/year capacity** in GHG emissions
fuels production from • Robust stakeholder
just over 500 million
gallons per year to
1 billion 70% engagement
over 1.2 billion gallons less*
reduction* • Negotiating feedstocks
water used annually in criteria pollutant
gallons per year emissions
*
Compared to Martinez previous operations as petroleum refinery
** Facility is expected to start producing renewable diesel in 2022 and reach full capacity in 2023
Structured Approach to New Opportunities
Sustainable Renewable
Apply key criteria to: Commercial Aviation Waste
to Fuels Natural
Viability Fuel Gas
• Create incremental value on base investments
• Pursue capital infrastructure investments that
continue to lower carbon intensity Exploring sustainable Partnering with Fulcrum Evaluating strategic Renewable
Scalability Returns aviation fuel opportunities BioEnergy to process Natural Gas (RNG) opportunities
• Leverage commercial opportunities with value
with Southwest Airlines and biocrude from municipal for key MPC and MPLX assets;
chain partners
other potential partners solid waste Coalition for Renewable Natural
Gas member
10I N N O V AT E F O R
THE FUTURE
Advanced Biofuels Research and Development
Virent — Wholly Owned Subsidiary Flexible Feedstocks
Advanced biofuel and
renewable chemical Madison,
Wisconsin
$200 million+ • Agriculture and forestry wastes and plant sugars
• Optionality to respond to commodity markets
invested in research
• Avoids oilseed and protein feedstock competition
research, development and development since 2002
and commercialization
Novel technology converts plant sugars to 22,000+ Ready for Commercial Deployment
fossil-free fuels and chemicals gallons of BioFormate
produced for fuels testing • Well-demonstrated technology
BioForm® Gasoline • Growing family of patents
GAS
DIESEL BioForm® Renewable Diesel
14+ • Technology packages ready for licensing
tonnes of bio-paraxylene,
BioForm® Synthesized Aromatic 100% renewable polyester, produced Broad Market Potential for Biobased Products
Kerosene Jet Fuel for testing and market demonstrations
JET
BioForm® Synthesized Kerosene
Jet Fuel
240+
patents issued or allowed, Ground Aviation Fabric and Plastics Packing and
BioForm® Paraxylene including 120 pending patent transportation fuel textiles packaging
fuel
applications worldwide
BioForm® Benzene
11Embed
Sustainability
Embracing sustainability in
decision-making, in how we engage
our people and in how we create
value with stakeholders
We maintain a companywide commitment to
protecting the health and safety of our employees and
the public, responsibly managing our social impacts,
promoting diversity, equity and inclusion, and
maintaining accountable and transparent governance.
12EMBED
S U S TA I N A B I L I T Y
Accountable and Transparent Governance
Board Oversight Regular Dialogue with Investor Strong Compliance and Sustainability Linked to
Stewardship Teams Ethics Programs Compensation
ESG embedded across
• Reporting in line with GRI Core, Policy on Human Rights, 20% of annual bonus
multiple Board committees
SASB, TCFD and CDP Including the Rights of target based on ESG
• Sustainability and Public Policy Indigenous People metrics
• No. 1 on S&P Global ESG Rating
• Governance
for U.S. Oil and Gas Refining and
• Compensation Recognized by MSCI as
Marketing sector
• Audit leading our sector on Operational Excellence
• Top decile in downstream sector Corporate Behavior Management System
Board Tenure Independence* on Sustainalytics and MSCI
100% of our company
9+ years ratings
is in scope for our
2 OEMS in alignment
0-3 years with the Responsible
2 92% Care 14001® and ISO
4-8 years
4 9001 management
systems including
0-3 years 4-8 years 9+ years 1 2
environmental,
average tenure 4.5 years Independent Board Chair
quality, health,
Diversity Ri
safety and security
ESG sks
42%
Comprehensive requirements.
skill sets including
Risk Management
diverse ESG and public
(gender, race, ethnicity and Native
policy ERM ESG and climate-related risks embedded
American tribal membership) into the company’s structured Enterprise
s
C li
m
sk
at i
e-R e te d R Risk Management process
As defined by the independence rules of the New York Stock Exchange and applicable rules of the U.S. Securities and Exchange Commission
* la
13EMBED
S U S TA I N A B I L I T Y
Strong Safety Performance
40% reduction OSHA’S VOLUNTARY
PROTECTION PROGRAM
Promoting Health and
Safety During COVID-19
American Fuel & Petrochemical Manufacturers
Safety Awards
in Tier 1 and Tier 2 refining Eight MPC facilities were recognized by AFPM
• Our Corporate
33
for outstanding occupational and process safety
process safety events since 2016 Emergency Response programs and performance in 2020. These awards
Team implemented recognize facilities for strong safety performance,
MPC’s wide-ranging program innovation and safety leadership.
Refining Process Safety Event1 Rate VPP Star
(Events/200,000 hours)
certifications earned
pandemic response plan
• Offered COVID-19 DISTINGUISHED SAFETY AWARD:
vaccines as they became ROBINSON REFINERY
0.2
0.18
COVERING
available in coordination
44
0.16 0.16
0.15
0.15 with local and state public
health organizations ELITE GOLD AWARD:
• Provided critical up-to-date DETROIT REFINERY
0.1
0.08 MPC and MPLX information and guidance
facilities through a dedicated
0.05 0.05
0.05 0.04 0.04 0.04 ELITE SILVER AWARD:
COVID-19 employee
ANACORTES REFINERY AND DICKINSON
website RENEWABLE FUELS FACILITY
0
2016 2017 2018 2019 2020 • Required a daily COVID-19
self-screening per the
Tier 1 Tier 2 SAFETY ACHIEVEMENT AWARD:
CDC screening checklist
CANTON, EL PASO, MANDAN AND
before entering the SALT LAKE CITY REFINERIES
Based on the U.S. Bureau of Labor Statistics data.
2
workplace
14EMBED
S U S TA I N A B I L I T Y
Engaged and Energized Workforce
Our Diversity, Equity and Inclusion Journey Diversity Focus Areas
First independent U.S. downstream energy company to link
Building Awareness Increasing Representation
Diversity, Equity and Inclusion metric to compensation • Education and DE&I workshops • Balanced slates
• Employee DE&I panels • Focused external recruitment
• Community outreach • Black, Indigenous and People of Color (BIPOC) and
Employee Network Groups are Expanding • Employee Network Groups female campus initiatives to recruit interns
• Employee Network Groups
62 40%
Ensuring Success Measurement and Accountability
• Career development • Scoring and performance
• Mentoring • Succession planning
• DE&I assessments and interventions • Participation in federal compliance programs
network increase in employees • Employee Network Groups • Bonus metric
chapters participating since 2019
Attracting and Retaining Talented
Implemented People is Critical to Our Success Leadership
Policy on Development
• Leveraged technology and programs in
Human Rights, adapted internship and co-op place designed
Including program in light of COVID-19 to meet the
the Rights of • Welcomed over 500 needs of people
Indigenous interns and co-op
at different
People levels and
participants in 2020 stages of their
careers
15EMBED
S U S TA I N A B I L I T Y
Creating Shared Value Through Stakeholder Engagement
$17 million+ Comprehensive
approach to
Understand needs and concerns Supply Chain Sustainability Program
• Engaging with high-priority suppliers on
in community investment through MPC Foundation, corporate stakeholder Define priorities
engagement Supplier Code of Conduct and sustainability
charitable contributions and employee giving matched by the company Identify resources performance
across the
company Pursue shared goals • System in place to evaluate Tier 1 critical
suppliers in 2021
Increased employee
• Expanding Leadership, Engagement
giving corporate match
and Development (LEAD) mentorship
from 60% to 100% Industry-Leading Pipeline Public program
Engagement Program – Earning Your Trust
Thriving • Award-winning
Communities Pipeline Finder
app demonstrating
Community commitment to
Investment
Priorities
transparency in our
communities
Workforce • Increased
Sustainability
Development landowner pipeline
awareness to 98% Robust engagement with tribal
(29% increase from 2016) stakeholders in our operational footprint
Responding to COVID-19’s Challenges
Robust transparency on Investing up to $5 million in the
Deployed more $1 million donated Supported the Navajo political engagement
than 500,000 N95 to American Red Nation with 20,000 neighborhood near our Detroit
and lobbying refinery in 2021 to purchase
respirator masks Cross to help supply N95 respirator
to 45 healthcare critical resources masks, funding and residential properties, remove
organizations and support to additional medical abandoned homes and create
across 20 states communities supplies green space
16EMBED
S U S TA I N A B I L I T Y
ESG Recognitions
Top
Member of
S&P Global
Decile
100%
Dow Jones
Sustainability
Indices ESG Ratings
AWA R D S score
for S&P Global, MSCI
Dow Jones MPLX named ESG Top
and Sustainalytics in on Human Rights
Sustainability North Performer in the public
the U.S. Oil and Gas Campaign Corporate
America Index for midstream category from
Refining and Marketing Equality Index
third straight year Hart Energy
sector
17Pictured: MPC employees plant cord grasses to protect eroding shoreline at the Texas City Prairie Preserve. Forward-Looking Statements This publication includes forward-looking statements that are subject to risks, contingencies or uncertainties. You can identify our forward-looking statements by words such as “anticipate,” “believe,” “commitment,” “could,” “design,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “imply,” “intend,” “may,” “objective,” “opportunity,” “outlook,” “plan,” “policy,” “position,” “potential,” “predict,” “priority,” “project,” “proposition,” “prospective,” “pursue,” “seek,” “should,” “strategy,” “target,” “would,” “will,” or other similar expressions that convey the uncertainty of future events or outcomes. We have based our forward-looking statements on our current expectations, estimates and projections about our business and industry. We caution that these statements are not guarantees of future performance and you should not rely unduly on them, as they involve risks, uncertainties and assumptions that we cannot predict. Material differences between actual results and any future performance suggested in our forward-looking statements could result from a variety of factors, many of which are beyond our control, including without limitation the risks and uncertainties discussed under “Disclosures Regarding Forward-Looking Statements” and "Risk Factors" in our annual report on Form 10-K for the year ended Dec. 31, 2020, quarterly Form 10-Q filings and other filings made with the SEC from time to time; the effects of any divestitures on the business or our financial condition, results of operations and cash flows; consumer demand for refined products and renewable fuels; the success or timing of completion of ongoing or anticipated capital or maintenance projects, including the potential conversion of the Martinez Refinery to a renewable fuels facility; the receipt of relevant third party and/or regulatory approvals; our ability to successfully implement our sustainable energy and emission reduction principles, strategies, initiatives and targets, including our GHG intensity, methane intensity and freshwater withdrawal intensity targets, and realize the expected benefits thereof; the development and competitiveness of sustainable energy and emission reduction technologies; unforeseen technical or operating difficulties; general economic, political or regulatory developments, including changes in governmental policies relating to refined petroleum products, crude oil, natural gas or NGLs, regulation or taxation and other economic and political developments (including those caused by public health issues and outbreaks); and compliance with federal and state environmental, economic, health and safety, energy and other policies and regulations, including the cost of compliance with the Renewable Fuel Standard, and/or enforcement actions initiated thereunder. MPC undertakes no obligation to update any forward-looking statement except to the extent required by applicable law. Copies of MPC's Form 10-K, Forms 10-Q and other SEC filings are available on the SEC's website, MPC's website at https://www.marathonpetroleum.com/Investors/ or by contacting MPC's Investor Relations office.
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