Marathon officials mull $2B+ upgrade

Published 11:45 pm Friday, May 2, 2014

By Monique Roth


LAPLACE — A potential $2.2 to $2.5 billion upgrade to Marathon’s Garyville refinery is in the works, and the project would create 65 new direct jobs with an average annual salary of $115,000 per year, plus benefits, at the 522,000-barrel-per-day Marathon Petroleum site.

The Garyville site is the largest refinery in Louisiana and the third largest in the nation. Louisiana Economic Development estimates the project would result in an additional 304 new indirect jobs, for a total of more than 360 new jobs.

Marathon Petroleum officials said the company has filed permit applications for the proposed project with Louisiana’s Department of Environmental Quality and is currently completing feasibility studies. Marathon Petroleum expects to make a final decision on the project by early 2015.

If approved, the project would result in hydrotreating, hydrocracking and desulfurization equipment installations, along with additional infrastructure construction that would include buildings, tanks, cooling towers, rail and electrical facilities.

Among the jobs created would be 35 contractor employees at the refinery. In addition, the company estimates development of the project would result in 3,000 new construction jobs during the multi-year construction phase.

The new jobs would be in addition to the refinery’s existing workforce of 800 Marathon Petroleum employees and 650 contract workers.

“Never before in our state’s history have we seen such extraordinary gains in petroleum refining technology complemented by favorable oil and gas economics and the most rapidly improving business climate in America, and it’s all happening here in Louisiana,” Gov. Bobby Jindal said. “We’re proud that Marathon Petroleum recognizes the unique strengths that Louisiana offers in all of these areas, and that the company is capitalizing on this historic opportunity to redefine what leadership looks like in the vitally important energy sector.”

Jindal said the latest project proposed by Marathon represents another opportunity to assert Louisiana’s leadership role as the next great state for business investment and energy growth.

Described by Marathon Petroleum as a Residual Oil Upgrade Expansion, or ROUX, the capital investment would enable the company to convert a byproduct of the refining process — heavy residual oil — into approximately 1.2 million gallons per day of ultra low-sulfur diesel at Garyville. The ROUX project would follow Marathon Petroleum’s $3.9 billion refinery expansion in Garyville, which represented one of the largest manufacturing projects in Louisiana history upon its completion in late 2009. Since that time, the Garyville refinery has more than doubled its refining capacity.

“As part of the ongoing feasibility study, Marathon Petroleum is pleased to be taking this next step of submitting the permit applications for the Residual Oil Upgrade Expansion at our Garyville facility,” Rich Bedell, the company’s senior vice president for refining, said.

If the company decides to move forward, it is anticipated the construction would begin mid-2015 and be completed in 2018.

Should Marathon Petroleum move forward with the project, LED would offer a customized incentive package to the company, including a performance-based Modernization Tax Credit of $3 million, along with the services of LED FastStart, ranked the No. 1 state workforce training program in nation. In addition, the company would utilize the state’s Quality Jobs and Industrial Tax Exemption programs.

“Marathon Petroleum is a valued community partner, and we are excited that they are exploring new opportunities to expand in St. John the Baptist Parish,” St. John Parish President Natalie Robottom said. “We are proud that the third-largest oil refinery in the country calls St. John Parish home and we look forward to working with them as they continue to invest in our community.”