(Bloomberg) -- Now that Marathon Petroleum Corp. is combining with Andeavor, the largest U.S. refiner to be formed from the deal can dominate Mexico’s freshly liberated gasoline and diesel markets from all sides.
“We had identified a part of Mexico, which was primarily to the northern part of Mexico, which we could go after now with the access from the Gulf Coast,” said Greg Goff, chairman of Andeavor during a conference call Monday.
Andeavor won the first-ever open season for fuel-storage assets owned by Petroleos Mexicanos in 2017, but didn’t own refining capacity on the U.S. Gulf Coast to make the short tanker haul to major import ports like Pajaritos and Tuxpan on Mexico’s East Coast. Gasoline and diesel could be shipped by seafaring tankers or delivered over the border in railcars from the Gulf Coast, Marathon said after the deal was announced.
The U.S. supplied 86 percent of the 864,000 barrels a day of fuels Mexico sources from abroad in March, according to vessel-tracking and shipping data collated by Bloomberg. After Marathon’s $23.3 billion merger with Andeavor, it will become one of the biggest suppliers of fuel to Mexico, which struggles to produce a third of the fuels it could at nameplate capacity.
“We’re one of the largest suppliers out of Galveston Bay, we take gasoline and diesel into the eastern side of Mexico,” Gary Heminger, Marathon’s chief executive officer, said. “so together we provide a lot of supply into that market that would determine how we expand on that going forward.”
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