Arrow-right Camera

The Spokesman-Review Newspaper The Spokesman-Review

Monday, October 19, 2020  Spokane, Washington  Est. May 19, 1883
Cloudy 62° Cloudy
News >  Business

Marathon Petroleum combines midstream operations for $9B

 (Michael Conroy / AP)
(Michael Conroy / AP)
Associated Press

FINDLAY, Ohio – Marathon Petroleum Corp. is merging two of its oil and gas pipeline, transportation and storage operations for $9 billion.

MPLX and Andeavor Logistics are both master limited partnerships majority owned by Marathon, which raised the possibility that it might combine the two late last year.

Andeavor unitholders will receive 1.135 MPLX common units for each Andeavor common unit held. Marathon will receive 1.0328 MPLX common units for each Andeavor common unit held.

The enterprise value of the deal is listed at $14 billion.

“The combined entity will have an expanded geographic footprint which we believe enhances our long-term growth opportunities and the sustainable cash flow profile of the business. We are confident about the midstream growth and value-creation opportunities that exist across this combined platform in the best basins in the U.S.,” Marathon Chairman and CEO Gary Heminger said in a statement.

Low oil prices are helping to push consolidation efforts along in the energy sector. Aside from Marathon’s actions, Anadarko Petroleum has been the subject of a bidding war between Chevron and Occidental Petroleum. Anadarko announced Monday that it plans to end its $33 billion takeover deal with Chevron in favor of a revised bid by Occidental.

Andeavor, formerly known as Tesoro, has refineries in California, Minnesota, New Mexico, North Dakota, Texas, Utah, Washington and Alaska. The companies are all based in Findlay, Ohio.

The deal is targeted to close in the second half of the year.

Shares of Andeavor Logistics LP rose 3.4 percent in premarket trading Wednesday.

The Spokesman-Review Newspaper

Local journalism is essential.

Give directly to The Spokesman-Review's Northwest Passages community forums series -- which helps to offset the costs of several reporter and editor positions at the newspaper -- by using the easy options below. Gifts processed in this system are not tax deductible, but are predominately used to help meet the local financial requirements needed to receive national matching-grant funds.

Subscribe to the Coronavirus newsletter

Get the day’s latest Coronavirus news delivered to your inbox by subscribing to our newsletter.


American families feeling the pinch of COVID-19 pandemic

The COUNTRY Financial Security Index asked about 1,330 adult Americans in different income brackets a variety of questions, including how their finances are impacted by the COVID-19 pandemic. (Courtesy COUNTRY Financial)
Sponsored

The year 2020 hasn’t been the most forgiving year for families and their pocketbooks.