MPLX LP (MPLX) operates as a diversified, large-cap master limited partnership that owns and operates midstream energy infrastructure and logistics assets and provides fuels distribution services. MPLX GP LLC acts as the general partner of MPLX. The company operates as a subsidiary of Marathon Petroleum Corporation (MPC).
The company's assets include a network of crude oil and refined product pipelines, an inland marine business, light-product, asphalt, heavy oil, and marine terminals, storage...
MPLX LP (MPLX) operates as a diversified, large-cap master limited partnership that owns and operates midstream energy infrastructure and logistics assets and provides fuels distribution services. MPLX GP LLC acts as the general partner of MPLX. The company operates as a subsidiary of Marathon Petroleum Corporation (MPC).
The company's assets include a network of crude oil and refined product pipelines, an inland marine business, light-product, asphalt, heavy oil, and marine terminals, storage caverns, refinery tanks, docks, loading racks, and associated piping. Additionally, the company has crude oil and natural gas gathering systems and pipelines, as well as natural gas and NGL processing and fractionation facilities. These assets are positioned throughout the United States. The business consists of two segments based on the product-based value chain that each support: Crude Oil and Products Logistics and Natural Gas and NGL Services. The Crude Oil and Products Logistics segment primarily engages in the gathering, transportation, storage and distribution of crude oil, refined products, other hydrocarbon-based products, and renewables. The Crude Oil and Products Logistics segment also includes the operation of the company’s refining logistics, fuels distribution and inland marine businesses, terminals, rail facilities and storage caverns. The Natural Gas and NGL Services segment provides wellhead to market services, including gathering, processing and transportation of natural gas and NGLs.
The company continues to have a strategic relationship with MPC, which is a large source of its revenues. The company has executed numerous long-term, fee-based agreements with minimum volume commitments with MPC. As of December 31, 2024, MPC owned its general partner and approximately 64 percent of the company’s outstanding common units. In 2024, MPC accounted for 49 percent of its total revenues and other income, primarily within its Crude Oil and Products Logistics segment. The company also has long-term relationships with a diverse set of producer customers in many crude oil and natural gas resource plays, including the Marcellus Shale, Permian Basin, Utica Shale, STACK Shale and Bakken Shale, among others.
The company announced the expansion of MPLX’s Permian to Gulf Coast integrated value chain, with projects to construct a Gulf Coast fractionation complex consisting of two 150 mbpd fractionation facilities adjacent to MPC’s Galveston Bay refinery. The facilities are expected to be in service in 2028 and 2029.
Additionally, the company announced the formation of strategic joint ventures to develop a complimentary 400 mbpd LPG export terminal and an associated pipeline, which is anticipated to be in service in 2028.
Operating Segments
The company conducts its operations in two reportable segments, Crude Oil and Products Logistics; and Natural Gas and NGL Services.
Crude Oil and Products Logistics
The Crude Oil and Products Logistics segment includes the gathering, transportation, storage and distribution of crude oil, refined products, other hydrocarbon-based products and renewables. These assets consist of a network of 14,766 miles of wholly and jointly owned pipelines and associated storage assets, refining logistics assets at 13 refineries, 88 terminals, including rail and truck racks, one export terminal, storage caverns, tank farm assets, an inland marine business and a fuels distribution business. The company’s Crude Oil and Products Logistics assets are integral to the success of MPC’s operations. The company continues to evaluate projects and opportunities that will further enhance its existing operations and provide valuable services to MPC and third parties.
The company generates revenue in the Crude Oil and Products Logistics segment primarily by charging tariffs for gathering and transporting crude oil, refined products, other hydrocarbon-based products, and renewables through its pipelines and at its barge docks, delivering to domestic and international destinations. Additionally, the company earns fees for storing crude oil, refined products, and renewables at its storage facilities. The marine business generates revenue under a fee-for-capacity contract with MPC. The fuels distribution business provides services related to the scheduling and marketing of products on behalf of MPC, generating revenue based on the volume of MPC’s products sold each month. The company is also the operator of additional crude oil and refined product pipelines either owned by MPC or in which MPLX or MPC has an ownership interest, for which it receives operating fees. For the year ended December 31, 2024, approximately 88 percent of Crude Oil and Products Logistics segment revenues and other income was generated from MPC.
Natural Gas and NGL Services
The Natural Gas and NGL Services segment gathers, processes, and transports natural gas; and transports, fractionates, stores and markets NGLs. As of December 31, 2024, gathering and processing assets available to MPLX included approximately 10.2 Bcf/d of gas gathering capacity, 12.4 Bcf/d of natural gas processing capacity, and 829 mbpd of fractionation and de-ethanization capacity. MPLX also owns or operates approximately 1,045 miles of NGL pipelines. For a summary of the company’s gas processing facilities, fractionation facilities, natural gas gathering systems and NGL and natural gas pipelines.
Revenues earned from two customers within the Marcellus region were also significant to the segment; however, neither of these customers represented more than 15 percent of Natural Gas and NGL Services segment revenues. These customers were not significant to MPLX's consolidated revenues.
Relationship with MPC
One of the company's competitive strengths is its strategic relationship with MPC, which operates one of the largest refining systems in the United States in terms of refining capacity. MPC owns and operates 13 refineries in the Gulf Coast, Mid-Continent, and West Coast regions of the United States and distributes refined products, including renewable diesel, through transportation, storage, distribution, and marketing services provided primarily by MPLX.
MPC retains a significant interest in the company through its non-economic ownership of the company's general partner and held approximately 64 percent of the outstanding common units of MPLX as of December 31, 2024. The company has implemented and continues to pursue growth and integration opportunities along the existing product-based value chains that benefit both MPC and MPLX, as demonstrated by the recently announced expansion of the Permian to Gulf Coast integrated value chain, which includes projects to construct a fractionation complex and LPG export terminal adjacent to MPC’s Galveston Bay refinery.
Crude Oil and Products Logistics Contracts with Mpc and Third Parties
Transportation Services Agreements, Storage Services Agreements, Terminal Services Agreements and Fuels Distribution Services Agreement with MPC
The company's Crude Oil and Products Logistics assets are strategically located within and are integral to MPC’s operations. The company has entered into multiple transportation, terminal, and storage services agreements with MPC. Under these long-term, fee-based agreements, the company provides transportation, terminal, and storage services to MPC, and most of these agreements include minimum committed volumes from MPC. Under the marine transportation service agreements, MPC has committed to pay a fixed fee for 100 percent of available capacity for boats, barges, and third-party chartered equipment. The company also has a fuels distribution agreement with MPC under which it provides scheduling and other services for MPC’s products.
The company has numerous storage services agreements governing storage services at various types of facilities, including terminals, pipeline tank farms, caverns, and refineries, under which MPC pays MPLX per-barrel fees for providing storage services. Some of these agreements provide MPC with exclusive access to storage at certain locations, such as storage located at MPC’s refineries or storage in certain caverns. Under these agreements, MPC pays MPLX a per-barrel fee for such storage capacity, regardless of whether MPC fully utilizes the available capacity.
Through its fuel’s distribution services, the company distributes refined products through an extensive network of retail locations owned or operated by independent entrepreneurs. The company has a fuels distribution service agreement with MPC under which MPC pays MPLX a tiered monthly fee based on the volume of MPC’s products marketed by MPLX each month, subject to a maximum annual volume. MPLX has agreed to use commercially reasonable efforts to sell not less than a minimum quarterly volume of MPC’s products during each calendar quarter. If MPLX sells less than the minimum quarterly volume of MPC’s products during any calendar quarter despite its commercially reasonable efforts, MPC will pay MPLX a deficiency payment equal to the volume deficiency multiplied by the applicable tiered fee. The dollar amount of actual sales volume of MPC’s products that exceeds the minimum quarterly volume (an Excess Sale) for a particular quarter will be applied as a credit, on a first-in-first-out basis, against any future deficiency payment owed by MPC to MPLX during the four calendar quarters immediately following the calendar quarter in which the Excess Sale occurs.
The company's agreements with MPC provide for annual escalations that are either fixed or based on a variety of factors, including the FERC index and various other inflation-based indexes, depending on the nature and geography of the services provided.
Pipeline Operating Agreements with MPC
The company operates various pipelines owned by MPC under operating services agreements. Under these agreements, the company receives an operating fee for operating the assets, which include certain MPC wholly owned or partially owned crude oil, natural gas, and refined product pipelines, as well as for providing various operational services related to those assets.
Other Pipeline Operating Agreements
The company maintains and operates five pipelines in which either MPC or MPLX has a joint interest. The company receives an operating fee for each of these pipelines, which is subject to adjustment for inflation. In addition, the company is reimbursed for specific costs associated with operating each pipeline. The length and renewal terms for each agreement vary.
Transportation, Terminal and Storage Services Agreements with Third Parties
The company has multiple transportation and terminal services agreements with third parties under which it provides the use of pipelines and tank storage, as well as services, facilities, and other infrastructure related to the receipt, storage, throughput, blending, and delivery of commodities. Some of these agreements contain minimum volume commitments, under which the company agrees to handle a certain amount of product throughput each month in exchange for a predetermined fixed fee. Under the remaining agreements, the company receives an agreed-upon fee based on actual product throughput following the completion of services.
Marine Management Services Agreements with MPC
MPLX has an agreement with MPC under which it provides management services to assist MPC in the oversight and management of the marine business. MPLX receives fixed annual fees for providing the required services, which are subject to predetermined annual escalation rates. This agreement is subject to an initial term of five years and automatically renews for one additional five-year renewal period unless terminated by either party.
Other Agreements with MPC
The company has omnibus agreements with MPC that address its payment of a fixed annual fee to MPC for the provision of executive management services by certain executive officers of its general partner, as well as its reimbursement to MPC for the provision of certain services. These agreements also include MPC’s indemnification of the company for certain matters, including specific environmental, title, and tax matters. In addition, the company indemnifies MPC for certain matters under these agreements. The omnibus agreements also provide for other reimbursements, including those related to certain capital and expense projects.
The company also has various employee services agreements and a secondment agreement under which it reimburses MPC for the provision of certain operational and management services. All of the employees that conduct the company's business are directly employed by affiliates of its general partner.
Natural Gas and NGL Services Contracts with Mpc and Third Parties
The majority of the company's revenues in the Natural Gas and NGL Services segment are generated from wellhead to market services, including natural gas gathering, transportation, and processing, as well as NGL transportation, fractionation, marketing, and storage. MPLX enters into a variety of contract types, including fee-based, percent-of-proceeds, keep-whole, and purchase arrangements in order to generate revenues.
Keep-whole Agreement with MPC
MPLX has a keep-whole commodity agreement related to its Rockies operations with MPC. Under the agreement, MPC pays the company a processing fee for NGLs related to keep-whole agreements, and the company pays MPC a marketing fee in exchange for assuming the commodity risk. This agreement is scheduled to expire in 2025.
Seasonality
The volume of crude oil and refined products transported and stored utilizing the company’s assets is affected by the level of supply and demand for crude oil and refined products in the markets served directly or indirectly by the company’s assets. The majority of effects of seasonality on the Crude Oil and Products Logistics segment’s revenues are mitigated through the use of capacity-based agreements and minimum volume commitments.
Regulatory Matters
The company’s operations are subject to numerous laws and regulations, including those relating to the protection of the environment. Such laws and regulations include, among others, the Interstate Commerce Act (‘ICA’), the Natural Gas Act (‘NGA’), the Clean Water Act (‘CWA’) with respect to water discharges, the Clean Air Act (‘CAA’) with respect to air emissions, the Resource Conservation and Recovery Act (‘RCRA’) with respect to solid and hazardous waste treatment, storage and disposal, the Comprehensive Environmental Response, Compensation, and Liability Act (‘CERCLA’) with respect to releases and remediation of hazardous substances and the Oil Pollution Act of 1990 (‘OPA-90’) with respect to oil pollution and response. In addition, many states where the company operates have similar laws.
Some of the company’s existing pipelines are considered interstate common carrier pipelines subject to regulation by the FERC under the ICA, Energy Policy Act of 1992 (EPAct 1992) and the rules and regulations promulgated under those laws.
The company is subject to regulation by the DOT under the Hazardous Liquid Pipeline Safety Act of 1979 (HLPSA). The company is also subject to the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, which increased penalties for safety violations, established additional safety requirements for newly constructed pipelines, and mandated studies of certain safety issues that could lead to the adoption of new regulatory requirements for existing pipelines. Additionally, the company is subject to the Protecting Our Infrastructure of Pipelines and Enhancing Safety Act of 2016, which required PHMSA to develop underground gas storage standards within two years and provided PHMSA with significant new authority to issue industry-wide emergency orders if an unsafe condition or practice results in an imminent hazard.
The DOT has delegated its authority under these statutes to the PHMSA, which administers compliance with these statutes and has promulgated comprehensive safety standards and regulations for the transportation of natural gas by pipeline (49 C.F.R. Part 192), as well as hazardous liquids by pipeline (49 C.F.R. Part 195), including regulations for the design and construction of new pipelines or those that have been relocated, replaced or otherwise changed (Subparts C and D of 49 C.F.R., Part 195); pressure testing of new pipelines (Subpart E of 49 C.F.R. Part 195); operation and maintenance of pipelines, establishing programs for public awareness and damage prevention, managing the integrity of pipelines in HCAs and managing the operation of pipeline control rooms (Subpart F of 49 C.F.R. Part 195); protecting steel pipelines from the adverse effects of internal and external corrosion (Subpart H of 49 C.F.R. Part 195); and integrity management requirements for pipelines in HCAs (49 C.F.R. 195.452).
Environmental and Other Regulations
The company maintains numerous discharge permits as required under the National Pollutant Discharge Elimination System program of the CWA and have implemented systems to oversee the company’s compliance with these permits. In addition, the company is regulated under OPA-90, which, among other things, requires the owner or operator of a tank vessel or a facility to maintain an emergency plan to respond to releases of oil or hazardous substances.
The company has implemented emergency oil response plans for all of the company’s components and facilities covered by OPA-90 and the company has established Spill Prevention, Control and Countermeasures plans for all facilities subject to such requirements.
The company is subject to oversight pursuant to the federal Occupational Safety and Health Act, as amended (OSH Act), as well as comparable state statutes that regulate the protection of the health and safety of workers.
The company is also subject at regulated facilities to the Occupational Safety and Health Administration’s Process Safety Management and EPA’s Risk Management Program requirements, which are intended to prevent or minimize the consequences of catastrophic releases of toxic, reactive, flammable or explosive chemicals. The application of these regulations can result in increased compliance expenditures.
The company’s marine transportation business is subject to regulation by the USCG, federal laws, including the Jones Act, state laws and certain international conventions, as well as numerous environmental regulations. The majority of the company's vessels are subject to inspection by the USCG and carry certificates of inspection. The crews employed aboard the vessels are licensed or certified by the USCG. The company is required by various governmental agencies to obtain licenses, certificates, and permits for its vessels.
The company's marine transportation business competes principally in markets subject to the Jones Act, a federal cabotage law that restricts domestic marine transportation in the United States to vessels built and registered in the United States, and manned and owned by United States citizens. The company meets all of the requirements of the Jones Act for its vessels.
The company has several facilities that are subject to the United States Coast Guard’s Maritime Transportation Security Act, as well as a number of other facilities that are subject to the Transportation Security Administration’s Pipeline Security Guidelines and are designated as Critical Facilities. The company has an internal inspection program designed to monitor and ensure compliance with all of these requirements.
Various federal agencies, including the EPA and the Department of the Interior, along with certain Native American tribes, promulgate and enforce regulations pertaining to oil and gas operations on Native American tribal lands where the company operates. These regulations include matters, such as lease provisions, drilling and production requirements, and standards to protect environmental quality and cultural resources.
History
MPLX LP was founded in 2012. The company was incorporated in 2012 as a Delaware limited partnership.
