Marathon to Expand La. Refinery

AP ^ | 10/27/2005 | AP

[eraser2005]

Marathon to Expand Garyville, La.-Based Refinery in $2.2 Billion Project

HOUSTON (AP) -- Marathon Oil Corp., an energy concern, said it expand its Garyville, La.-based refinery production capacity in project estimated at $2.2 billion.

The expansion would boost production by 180,000 barrels per day, or bpd, to 425,000 bpd from 245,000 bpd.

[eraser2005]

If Marathon can do this on 3Q earnings of $770 million, think of what Exxon or Shell could do with 3Q earnings 13 times as high, if they actually would want to....

[cynicom]

That would increase supply and they don't want that. Demand is always an unwanted orphan.

[FlipWilson]

Now that the pressure is on the oil companies to expand capacity (and hopefully the Republicans will pass (or bring up) more legislation to enable new refineries to be built) the price of oil may tumble. I wonder if the demand is being driven by the refined products, not the crude?

[CharlesWayneCT]

If regulations are eased, the small companies will build more refineries to undercut the big companies and gain market share.

THe fixed cost of regulation makes it prohibitive for small companies to break into the market, thus making it easier for big companies (for which regulation is a smaller percent of operating expenses) to control supply and prop up prices.

[SF Republican]

Heard a pretty neat discussion on the radio last night; it appears this planet (forgive my ignorance) makes its own oil. It is not a fossil fuel it is a byproduct of what this planet makes. They have been saying for 50 years we are running out but continue to find trillions of barrels around the planet. And some fields that have gone back to that they thought had dried up, are filling back up with crude much the same way your water well does. It was really interesting. They did mention the big problem is that refineries are not being built to keep up demand.

[Admin Moderator]

Do not alter the published headlines of articles. Thanks.

[plain talk]

This raises an interesting point. Many politicians mention "we haven't built a refinery in 20-30 years". While this may be a valid point, it incorrectly implies we are standing still. Existing refineries have been enhanced and expanded over the last 20-30 years. I never hear this point made.

[Rocky]

I think you may be talking about this:

SCIENTIST STIRS THE CAULDRON: OIL, HE SAYS, IS RENEWABLE

http://www.freerepublic.com/focus/fr/574189/posts

[cynicom]

Exxon/Mobil and the like have no interest in increasing "supply" of gasoline as they know that the gasoline market is the quickest, and easiest market that can be manipulated.

All other oil markets take a great deal of time to show profit and never is advantageous for them. I pay the same price for a quart of motor oil today that I did six months ago.

[proxy_user]

They are predicted to make $8.25 a share this year, and $8.45 a share next year, in after-tax profit. You would think they could do a little better than $1.36 for a dividend, and still have plenty of money left over to expand their business.

[oceanagirl]

According to a story that I read earlier and can no longer find, this refinery will be upgraded so that it can handle heavy, high sulfur crude.

Much "new" oil is likely to be heavy, high sulfur or both like Caspian, tar sands, Orinoco and Saudi heavy. It will be to our advantage to be able to refine black goo into more useful products like gasoline, diesel, heating oil and the various aviation fuels. Really, the majors should get on the stick.

[Ursus arctos horribilis]

I am oil field trash and retired from Marathon, a great company to have worked for.

[Ursus arctos horribilis]

I recently read of lab research to have shown that rocks subjected to heat and pressure produce methane, bacteria feeding on the methane die off, producing crude oil.

It is always amazing to me that life (bacteria) can not only subsist, but thrive in such conditions of high heat and pressures.

[Altair333]

"I am oil field trash"

That's the spirit.

[Tarheel]

I followed the link to the original article and the article's title, subtitle and attribution (AP) was as is posted here. I was unable to see a difference perhaps I was not looking closely.

Are you referencing the poster's comment in posting #1, re: oil company 3rd quarter profits?

[Ursus arctos horribilis]

"That's the spirit."

I am oil field trash. Maybe with the caveat to smile when you say that. ;>)

[Boss_Jim_Gettys]

"If regulations are eased, the small companies will build more refineries to undercut the big companies and gain market share."

The big oil companies do not want any refineries. The real money is in pulling the resource out of the ground. Refining is a relatively low margin operation that is a necessary evil in order to convert crude oil into salable products.

That is why companies like ExxonMobil have sold many of their refineries in the past decade and why Unocal sold all of its refineries and service stations to become a resource-only company.

[Admin Moderator]

We replaced the poster's title with the title from the source.

[eraser2005]

I've heard that theory as well - and honestly it makes a good deal of sense based on observations, but it also still ends up with a finite production rate ala peak oil, as there is a max rate at which the earth would produce oil...