Marathon Petroleum Corporation (MPC) is a publicly listed oil and gas company headquartered in the USA. In 2020, it had USD 69.03 billion in revenue and reported 57,900 employees.* MPC’s main business areas include petroleum refining, marketing and transportation. Since 2014, MPC has been broadening its renewable fuels portfolio but its emissions have remained stable since 2015.
MPC has set a target for a 30% reduction in its scope 1 and 2 emissions intensity by 2030 compared to 2014 levels that is has already achieved in 2019 due to significant emissions intensity reductions between 2014 and 2019. However, the company scores poorly in this area of the assessment as it has not scaled its existing target up and has not set a target covering its scope 3 emissions. To improve its performance, MPC should set targets that include its scope 3 emissions intensity. The company should also set a longer-term target for 2050 as well as regularly spaced intermediate targets to incentivise near-term action for its long-term goals.
MPC reports that it plans to invest USD 100 million over the next ten years to commercialise its Virent technology, which converts bio-based feedstocks into renewable fuels. However, this investment could not be included in the assessment as MPC does not disclose its total research and development (R&D) expenditure or the share of the company’s R&D directed towards low-carbon and mitigation technologies. This information is needed to assess whether the company is developing sufficient low-carbon technologies to enable the replacement of fossil fuel assets over time and increase its adoption of low-carbon technologies.
MPC has a policy that expects suppliers to reduce their waste, emissions and effluents, and reports that it integrates climate criteria into its supplier selection process. However, the company’s actual criteria for supplier selection could not be identified, which limits its performance in this area of the assessment. MPC also provides sustainability training to its suppliers. While the company has started taking action to engage with its suppliers on low-carbon commitments, it needs to be consistent in turning its supplier engagement strategy into concrete actions to drive significant emissions reduction. Its 2020 partnership with EcoVadis might help MPC improve its performance on supplier engagement as it will initiate supplier ESG performance assessments.
MPC has a policy to manage engagement with trade associations on climate change issues and reports that the recent climate positions of the trades in which in which it engages are not inconsistent with its commitment to sustainability. However, the company is a member of the American Fuel and Petrochemical Manufacturers (AFPM), which is reported to have opposed multiple climate policies in the USA. The company reports that it seeks to work with trade associations towards compromises when there is a divergence in their climate policy positions, but makes clear that it does not control the position that any trade association may take on a particular issue. MPC can increase the credibility of its climate rhetoric by defining a clear position on climate change and by implementing processes to withdraw from associations that oppose climate policies or publicly oppose from these associations.
MPC is involved in several activities to increase the share of low-carbon business activities in its overall operations. This has included the development of its tallow-based renewable diesel plant and its work on advanced biofuels. In addition, MPC has six carbon capture, use and storage (CCUS) plants in operation that collectively capture over half a million tonnes of CO2, which is then sold for industrial applications and to the food and beverage industry.
However, MPC does not disclose information about the profitability, current size, growth potential and deployment schedules of its low-carbon business activities. This information is essential if the company is to substantiate its efforts towards the development of a low-carbon business model.
MPC receives a trend score of =. If the company were reassessed in the future, its score would likely remain the same. Marathon’s scope 1 and 2 emissions intensity have decreased in line with the company’s 1.5°C pathway. To maintain alignment, MPC needs to set up targets covering scope 3 emissions and future forward-looking GHG targets. MPC’s plans to invest in and deploy biofuels and CCUS projects at scale can improve its performance, but the company has not yet substantiated these plans with a clear deployment strategy or revenue disclosure.
MPC has set a target to reduce its scope 1 and 2 emissions intensity by 30% by 2030 compared to 2014 and has already achieved this target in 2019. The company also has implemented a 2025 methane reduction target aiming at a 50% reduction by 2025 compared to 2016 but it lacks a scope 3 emissions reduction target. The company aims to reduce emissions through its six CCUS projects and increase its production of soy-, corn- and tallow-based renewable fuels.
MPC aims to reduce emissions through its six CCUS projects and increase its production of soy-, corn- and tallow-based renewable fuels. It is also converting some of its refineries into renewable diesel facilities to triple the production of its renewable fuels with the aim of reaching a capacity of 1 billion gallons per year.
MPC is planning to significantly invest in advanced biofuels, with a notable investment of around USD 100 million over the next decade to commercialize its Virent technology (working on the conversion of bio-based feedstocks into renewable fuels). However, the company’s reported disclosures in 2019 did not provide a clear indication of its investment plan and its capital expenditure (CapEx) and research and development (R&D) spending towards low-carbon and mitigation technologies.
MPC reports to have invested about USD 19 billion since 2015 in its midstream operations to acquire and optimize its integrated natural gas gathering and processing network. Despite the company’s commitment to ramp up renewable fuels production, the majority of its investments are still allocated to fossil fuels.
MPC demonstrates potential to transition away from fossil fuels with the expansion of its renewable fuels production and its existing emissions targets. While the company’s scope 1 and 2 and scope 1, 2, and 3 emissions intensities have significantly decreased since 2015, MPC remains heavily reliant on natural gas.