Marathon proposes La. refinery expansion

Marathon Petroleum Corp. said it is taking the next step toward a potential $2.2 billion to $2.5 billion upgrade to the company’s Garyville refinery and expects to make a final decision on the project by early 2015.

The St. John the Baptist Parish project would create 65 new direct jobs, with an average annual salary of $115,000 per year, plus benefits.

The company plans to file permit applications for the potential project with Louisiana’s Department of Environmental Quality at the end of April, having completed feasibility studies on the project.

“If the company decides to move forward, it is anticipated that the construction would begin mid-2015 and be completed in 2018,” said Rich Bedell, the company’s senior vice president for refining.

“In addition to the potential refinery jobs, we would estimate that approximately 3,000 construction jobs will be created during the construction phase.”

Marathon Petroleum operates a 522,000-barrel-per-day refinery at the site, the largest in Louisiana and third-largest in the U.S. The refinery employs 800 Marathon Petroleum employees and 650 contract workers.

Described by Marathon Petroleum as a Residual Oil Upgrade Expansion , the proposed project would enable the company to convert a byproduct of the refining process — heavy residual oil — into about 1.2 million gallons per day of ultra low-sulfur diesel at Garyville.

The project would include hydrotreating, hydrocracking and desulfurization equipment installations, along with buildings, tanks, cooling towers, and rail and electrical facilities.

The ROUX project would follow Marathon Petroleum’s $3.9 billion refinery expansion in Garyville, 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.

“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,” Gov. Bobby Jindal said in a statement.

The Louisiana economic development department estimates the project would result in an additional 304 indirect jobs. Among those would be 35 new contractor employees at the refinery.

Should Marathon Petroleum undertake the project, LED would offer the company a performance-based Modernization Tax Credit of $3 million, along with the job training services. The company also would use the state’s Quality Jobs and Industrial Tax Exemption programs.