Marathon Petroleum in Advanced Talks For Alaska Plant Sale

(Bloomberg) -- Marathon Petroleum Corp. is in “advanced discussions with several parties” on the sale of its Kenai refinery in Alaska as the company seeks to streamline operations and focus on renewables, according to its top boss.

The largest independent U.S. crude refiner by market value is aiming for increased opportunities in the shift away from fossil fuels “where things are going to be growing over the next couple of decades,” Chief Executive Officer Michael J. Hennigan said during a conference call with analysts. Expanding Marathon’s refining footprint is “not a priority.”

Marathon’s push to sell the Kenai plant was initially disclosed Tuesday in the company’s third-quarter earnings statement. The decision comes even as U.S. refining margins are rebounding from a pandemic-driven slump, with gasoline demand now close to pre-Covid 19 levels and stocks at the lowest since November 2017. Marathon posted a $694 million third-quarter profit, swinging from an $886 million loss a year earlier.

The Kenai refinery is one of Marathon’s smallest, processing up to 68,000 barrels a day. The plant handles mainly Alaskan crude.

Reports that Marathon was seeking to sell Kenai refinery first surfaced in 2019. At the time, activist investor Elliott Management Corp. listed the plant among “several logical non-core” Marathon properties. Marathon shares fell 4.1% to $64.44 at 12:40 p.m. in New York.

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