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1、Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-Q(Mark One)QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31,2023ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITI
2、ES EXCHANGE ACT OF 1934For the transition period from to Commission file number 001-35054Marathon Petroleum Corporation(Exact name of registrant as specified in its charter)Delaware 27-1284632(State or other jurisdiction of incorporation or organization)(I.R.S.Employer Identification No.)539 South M
3、ain Street,Findlay,Ohio 45840-3229(Address of principal executive offices)(Zip code)(419)422-2121(Registrants telephone number,including area code)Securities registered pursuant to Section 12(b)of the ActTitle of each classTrading Symbol(s)Name of each exchange on which registeredCommon Stock,par va
4、lue$.01MPCNew York Stock ExchangeIndicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 duringthe preceding 12 months(or for such shorter period that the registrant was required to file such reports),and
5、(2)has been subject to such filing requirements forthe past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 ofRegulation S-T(232.405 of this chapter)during the preceding 12 months(or f
6、or such shorter period that the registrant was required to submit such files.)Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or anemerging growth company.See the definitions of“large accelerat
7、ed filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”inRule 12b-2 of the Exchange Act.Large Accelerated Filer Accelerated Filer Non-accelerated Filer Smaller reporting company Emerging growth company If an emerging growth company,indicate by check mark if the registr
8、ant has elected not to use the extended transition period for complying with any new orrevised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act)Yes No The
9、re were 424,282,812 shares of Marathon Petroleum Corporation common stock outstanding as of April 26,2023.Table of Contents Table of Contents PagePART I-FINANCIAL INFORMATIONItem 1.Financial Statements:Consolidated Statements of Income(Unaudited)3Consolidated Statements of Comprehensive Income(Unaud
10、ited)4Consolidated Balance Sheets(Unaudited)5Consolidated Statements of Cash Flows(Unaudited)6Consolidated Statements of Equity and Redeemable Noncontrolling Interest(Unaudited)8Notes to the Consolidated Financial Statements(Unaudited)9Item 2.Managements Discussion and Analysis of Financial Conditio
11、n and Results of Operations25Item 3.Quantitative and Qualitative Disclosures about Market Risk44Item 4.Controls and Procedures45PART II-OTHER INFORMATIONItem 1.Legal Proceedings46Item 1A.Risk Factors46Item 2.Unregistered Sales of Equity Securities and Use of Proceeds47Item 6.Exhibits48Signatures49Un
12、less otherwise stated or the context otherwise indicates,all references in this Form 10-Q to“MPC,”“us,”“our,”“we”or“the Company”mean MarathonPetroleum Corporation and its consolidated subsidiaries.1Table of Contents Glossary of TermsThroughout this report,the following company or industry specific t
13、erms and abbreviations are used:ANSAlaska North Slope crude oil,an oil index benchmark priceASCAccounting Standards CodificationASUAccounting Standards UpdatebarrelOne stock tank barrel,or 42 U.S.gallons liquid volume,used in reference to crude oil or other liquid hydrocarbonsCARBCalifornia Air Reso
14、urces BoardCARBOBCalifornia Reformulated Gasoline Blendstock for Oxygenate BlendingCBOBConventional Blending for Oxygenate BlendingEBITDAEarnings Before Interest,Tax,Depreciation and Amortization(a non-GAAP financial measure)EPAU.S.Environmental Protection AgencyFASBFinancial Accounting Standards Bo
15、ardGAAPAccounting principles generally accepted in the United StatesLIFOLast in,first out,an inventory costing methodmbpdThousand barrels per dayMEHMagellan East Houston crude oil,an oil index benchmark priceMMBtuOne million British thermal unitsNGLNatural gas liquids,such as ethane,propane,butanes
16、and natural gasolineNYMEXNew York Mercantile ExchangeRFS2Revised Renewable Fuel Standard program,as required by the Energy Independence and Security Act of 2007RINRenewable Identification NumberSECU.S.Securities and Exchange CommissionULSDUltra-low sulfur dieselUSGCU.S.Gulf CoastVIEVariable interest
17、 entityWTIWest Texas Intermediate crude oil,an oil index benchmark price2Table of Contents PART I FINANCIAL INFORMATIONItem 1.Financial StatementsMarathon Petroleum CorporationConsolidated Statements of Income(Unaudited)Three Months Ended March 31,(In millions,except per share data)20232022Revenues
18、and other income:Sales and other operating revenues$34,864$38,058 Income from equity method investments133 142 Net gain(loss)on disposal of assets3(18)Other income77 202 Total revenues and other income35,077 38,384 Costs and expenses:Cost of revenues(excludes items below)29,294 35,068 Depreciation a
19、nd amortization800 805 Selling,general and administrative expenses691 603 Other taxes231 192 Total costs and expenses31,016 36,668 Income from operations4,061 1,716 Net interest and other financial costs154 262 Income before income taxes3,907 1,454 Provision for income taxes823 282 Net income3,084 1
20、,172 Less net income attributable to:Redeemable noncontrolling interest23 21 Noncontrolling interests337 306 Net income attributable to MPC$2,724$845 Per share data(See Note 7)Basic:Net income attributable to MPC per share$6.13$1.50 Weighted average shares outstanding444 564 Diluted:Net income attri
21、butable to MPC per share$6.09$1.49 Weighted average shares outstanding447 568 The accompanying notes are an integral part of these consolidated financial statements.3Table of Contents Marathon Petroleum CorporationConsolidated Statements of Comprehensive Income(Unaudited)Three Months Ended March 31,
22、(Millions of dollars)20232022Net income$3,084$1,172 Defined benefit plans:Actuarial changes,net of tax of$1 and$4,respectively2 12 Prior service,net of tax of$(4)and$(4),respectively(13)(13)Other,net of tax of$0 and$(2),respectively(6)Other comprehensive loss(11)(7)Comprehensive income3,073 1,165 Le
23、ss comprehensive income attributable to:Redeemable noncontrolling interest23 21 Noncontrolling interests337 306 Comprehensive income attributable to MPC$2,713$838 The accompanying notes are an integral part of these consolidated financial statements.4Table of Contents Marathon Petroleum CorporationC
24、onsolidated Balance Sheets(Unaudited)(Millions of dollars,except share data)March 31,2023December 31,2022AssetsCash and cash equivalents$7,960$8,625 Short-term investments3,492 3,145 Receivables,less allowance for doubtful accounts of$32 and$29,respectively10,143 13,477 Inventories10,268 8,827 Other
25、 current assets623 1,168 Total current assets32,486 35,242 Equity method investments6,626 6,466 Property,plant and equipment,net35,391 35,657 Goodwill8,244 8,244 Right of use assets1,269 1,214 Other noncurrent assets3,021 3,081 Total assets$87,037$89,904 LiabilitiesAccounts payable$13,031$15,312 Pay
26、roll and benefits payable636 967 Accrued taxes1,617 1,140 Debt due within one year75 1,066 Operating lease liabilities404 368 Other current liabilities1,294 1,167 Total current liabilities17,057 20,020 Long-term debt27,205 25,634 Deferred income taxes5,893 5,904 Defined benefit postretirement plan o
27、bligations1,147 1,114 Long-term operating lease liabilities858 841 Deferred credits and other liabilities1,214 1,304 Total liabilities53,374 54,817 Commitments and contingencies(see Note 22)Redeemable noncontrolling interest968 968 EquityPreferred stock,no shares issued and outstanding(par value$0.0
28、0 per share,30 million shares authorized)Common stock:Issued 991 million and 990 million shares(par value$0.01 per share,2 billion shares authorized)10 10 Held in treasury,at cost 561 million and 536 million shares(35,079)(31,841)Additional paid-in capital33,408 33,402 Retained earnings28,528 26,142
29、 Accumulated other comprehensive income(loss)(9)2 Total MPC stockholders equity26,858 27,715 Noncontrolling interests5,837 6,404 Total equity32,695 34,119 Total liabilities,redeemable noncontrolling interest and equity$87,037$89,904 The accompanying notes are an integral part of these consolidated f
30、inancial statements.5Table of Contents Marathon Petroleum CorporationConsolidated Statements of Cash Flows(Unaudited)Three Months Ended March 31,(Millions of dollars)20232022Operating activities:Net income$3,084$1,172 Adjustments to reconcile net income to net cash provided by operating activities:A
31、mortization of deferred financing costs and debt discount(10)19 Depreciation and amortization800 805 Pension and other postretirement benefits,net14 35 Deferred income taxes(5)(52)Net(gain)loss on disposal of assets(3)18 Income from equity method investments(133)(142)Distributions from equity method
32、 investments183 160 Changes in income tax receivable478(13)Changes in the fair value of derivative instruments95(71)Changes in:Current receivables3,350(4,627)Inventories(1,441)(1,423)Current accounts payable and accrued liabilities(2,100)6,717 Right of use assets and operating lease liabilities,net(
33、2)2 All other,net(253)(87)Net cash provided by operating activities4,057 2,513 Investing activities:Additions to property,plant and equipment(457)(495)Disposal of assets3 7 Investments acquisitions and contributions(207)(112)redemptions,repayments and return of capital Purchases of short-term invest
34、ments(2,112)(364)Sales of short-term investments631 1,014 Maturities of short-term investments1,162 1,443 All other,net164 215 Net cash provided by(used in)investing activities(816)1,708 Financing activities:Long-term debt borrowings1,589 2,385 repayments(1,021)(1,218)Debt issuance costs(15)(16)Issu
35、ance of common stock17 96 Common stock repurchased(3,180)(2,846)Dividends paid(337)(330)Distributions to noncontrolling interests(329)(311)Repurchases of noncontrolling interests(100)Redemption of noncontrolling interests-preferred units(600)All other,net(31)(24)Net cash used in financing activities
36、(3,907)(2,364)6Table of Contents Three Months Ended March 31,(Millions of dollars)20232022Net change in cash,cash equivalents and restricted cash(666)1,857 Cash,cash equivalents and restricted cash at beginning of period8,631 5,294 Cash,cash equivalents and restricted cash at end of period$7,965$7,1
37、51 Restricted cash is included in other current assets on our consolidated balance sheets.The accompanying notes are an integral part of these consolidated financial statements.(a)(a)(a)7Table of Contents Marathon Petroleum CorporationConsolidated Statements of Equity and Redeemable Noncontrolling I
38、nterest(Unaudited)MPC Stockholders Equity Common StockTreasury StockAdditional Paid-in CapitalRetainedEarningsAccumulated OtherComprehensiveIncome(Loss)Non-controllingInterestsTotal EquityRedeemableNon-controllingInterest(Shares in millions;amounts in millions of dollars)SharesAmountSharesAmountBala
39、nce as of December 31,2022990$10(536)$(31,841)$33,402$26,142$2$6,404$34,119$968 Net income 2,724 337 3,061 23 Dividends declared on common stock($0.75 per share)(336)(336)Distributions to noncontrolling interests (306)(306)(23)Other comprehensive loss (11)(11)Shares repurchased (25)(3,238)(3,238)Sha
40、re-based compensation1 3 3 Equity transactions of MPLX 3(2)(598)(597)Balance as of March 31,2023991$10(561)$(35,079)$33,408$28,528$(9)$5,837$32,695$968 MPC Stockholders Equity Common StockTreasury StockAdditional Paid-in CapitalRetainedEarningsAccumulated OtherComprehensiveIncome(Loss)Non-controllin
41、gInterestsTotal EquityRedeemableNon-controllingInterest(Shares in millions;amounts in millions of dollars)SharesAmountSharesAmountBalance as of December 31,2021984$10(405)$(19,904)$33,262$12,905$(67)$6,410$32,616$965 Net income 845 306 1,151 21 Dividends declared on common stock($0.58 per share)(330
42、)(330)Distributions to noncontrolling interests (290)(290)(21)Other comprehensive loss (7)(7)Shares repurchased (37)(2,807)(2,807)Share-based compensation3 90 (1)89 Equity transactions of MPLX (25)(63)(88)Balance as of March 31,2022987$10(442)$(22,711)$33,327$13,420$(74)$6,362$30,334$965 The accompa
43、nying notes are an integral part of these consolidated financial statements.8Table of Contents Notes to Consolidated Financial Statements(Unaudited)1.Description of the Business and Basis of PresentationDescription of the BusinessWe are a leading,integrated,downstream energy company headquartered in
44、 Findlay,Ohio.We operate the nations largest refining system.We sell refinedproducts to wholesale marketing customers domestically and internationally,to buyers on the spot market and to independent entrepreneurs who operatebranded outlets.We also sell transportation fuel to consumers through direct
45、 dealer locations under long-term supply contracts.MPCs midstream operations areprimarily conducted through MPLX LP(“MPLX”),which owns and operates crude oil and light product transportation and logistics infrastructure as well asgathering,processing and fractionation assets.We own the general partn
46、er and a majority limited partner interest in MPLX.See Note 4.Basis of PresentationAll significant intercompany transactions and accounts have been eliminated.These interim consolidated financial statements are unaudited;however,in the opinion of our management,these statements reflect all adjustmen
47、ts necessaryfor a fair statement of the results for the periods reported.All such adjustments are of a normal,recurring nature unless otherwise disclosed.These interimconsolidated financial statements,including the notes,have been prepared in accordance with the rules of the SEC applicable to interi
48、m period financialstatements and do not include all of the information and disclosures required by GAAP for complete financial statements.Certain information and disclosuresderived from our audited annual financial statements,prepared in accordance with GAAP,have been condensed or omitted from these
49、 interim financialstatements.These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included inour Annual Report on Form 10-K for the year ended December 31,2022.The results of operations for the three months
50、 ended March 31,2023 are notnecessarily indicative of the results to be expected for the full year.2.Accounting StandardsNot Yet AdoptedASU 2023-01,Leases(Topic 842):Common Control ArrangementsIn March 2023,the FASB issued an ASU to amend certain provisions of ASC 842 that apply to arrangements betw
51、een related parties under common control.The ASU amends the accounting for the amortization period of leasehold improvements in common-control leases for all entities and requires certain disclosureswhen the lease term is shorter than the useful life of the asset.This ASU is effective for fiscal yea
52、rs beginning after December 15,2023,including interim periodswithin those fiscal years.Early adoption is permitted.We do not expect the application of this ASU to have a material impact on our consolidated financialstatements or financial disclosures.3.Short-Term InvestmentsInvestments ComponentsThe
53、 components of investments were as follows:March 31,2023(Millions of dollars)Fair ValueLevelAmortized CostUnrealized GainsUnrealizedLossesFair ValueCash and CashEquivalentsShort-termInvestmentsAvailable-for-sale debt securitiesCommercial paperLevel 2$2,765$(2)$2,763$538$2,225 Certificates of deposit
54、 and time depositsLevel 23,190 3,190 2,600 590 U.S.government securitiesLevel 11,487 1 1,488 850 638 Corporate notes and bondsLevel 239 39 39 Total available-for-sale debt securities$7,481$1$(2)$7,480$3,988$3,492 Cash3,972 3,972 Total$11,452$7,960$3,492 9Table of Contents December 31,2022(Millions o
55、f dollars)Fair ValueLevelAmortized CostUnrealized GainsUnrealizedLossesFair ValueCash and CashEquivalentsShort-termInvestmentsAvailable-for-sale debt securitiesCommercial paperLevel 2$3,074$(1)$3,073$1,106$1,967 Certificates of deposit and time depositsLevel 22,093 2,093 1,500 593 U.S.government sec
56、uritiesLevel 11,071 1,071 498 573 Corporate notes and bondsLevel 266 66 54 12 Total available-for-sale debt securities$6,304$(1)$6,303$3,158$3,145 Cash5,467 5,467 Total$11,770$8,625$3,145 Our investment policy includes concentration limits and credit rating requirements which limits our investments
57、to high quality,short term and highly liquidsecurities.Realized gains/losses were not material.All of our available-for-sale debt securities held as of March 31,2023 mature within one year or less or are readilyavailable for use.4.Master Limited PartnershipWe own the general partner and a majority l
58、imited partner interest in MPLX,which owns and operates crude oil and light product transportation and logisticsinfrastructure as well as gathering,processing and fractionation assets.We control MPLX through our ownership of the general partner interest and,as ofMarch 31,2023,we owned approximately
59、65 percent of the outstanding MPLX common units.Unit Repurchase ProgramIn November 2020,MPLX announced the board authorization of a unit repurchase program for the repurchase of up to$1.0 billion of MPLXs outstandingcommon units held by the public,which was utilized in 2022.On August 2,2022,MPLX ann
60、ounced its board of directors approved a$1.0 billion unit repurchaseauthorization.The unit repurchase authorizations have no expiration date.MPLX may utilize various methods to effect the repurchases,which could includeopen market repurchases,negotiated block transactions,accelerated unit repurchase
61、s,tender offers or open market solicitations for units,some of which maybe effected through Rule 10b5-1 plans.The timing and amount of future repurchases,if any,will depend upon several factors,including market and businessconditions,and such repurchases may be discontinued at any time.Total unit re
62、purchases were as follows for the respective periods:Three Months Ended March 31,(In millions,except per share data)20232022Number of common units repurchased 3 Cash paid for common units repurchased$100 Average cost per unit$32.06 As of March 31,2023,MPLX had approximately$846 million remaining und
63、er its unit repurchase authorization.Redemption of the Series B Preferred UnitsOn February 15,2023,MPLX exercised its right to redeem all of its 600,000 outstanding preferred units(the“Series B preferred units”).MPLX paid unitholdersthe Series B preferred unit redemption price of$1,000 per unit.The
64、final semi-annual distribution on the Series B preferred units was paid on February 15,2023in the usual manner.The excess of the total redemption price of$600 million paid to Series B preferred unitholders over the carrying value of the Series B preferred units on theredemption date resulted in a$2
65、million net reduction to retained earnings.The Series B preferred units were included in noncontrolling interest on ourconsolidated balance sheet at December 31,2022.10Table of Contents AgreementsWe have various long-term,fee-based commercial agreements with MPLX.Under these agreements,MPLX provides
66、 transportation,storage,distribution andmarketing services to us.With certain exceptions,these agreements generally contain minimum volume commitments.These transactions are eliminated inconsolidation but are reflected as intersegment transactions between our Refining&Marketing and Midstream segment
67、s.We also have agreements with MPLXthat establish fees for operational and management services provided between us and MPLX and for executive management services and certain general andadministrative services provided by us to MPLX.These transactions are eliminated in consolidation but are reflected
68、 as intersegment transactions between ourCorporate and Midstream segments.Noncontrolling InterestAs a result of equity transactions of MPLX,we are required to adjust non-controlling interest and additional paid-in capital.Changes in MPCs additional paid-incapital resulting from changes in its owners
69、hip interests in MPLX were as follows:Three Months Ended March 31,(Millions of dollars)20232022Increase(decrease)due to change in ownership$1$(37)Tax impact2 12 Increase(decrease)in MPCs additional paid-in capital,net of tax$3$(25)5.Variable Interest EntitiesConsolidated VIEWe control MPLX through o
70、ur ownership of its general partner.MPLX is a VIE because the limited partners do not have substantive kick-out or participatingrights over the general partner.We are the primary beneficiary of MPLX because in addition to our significant economic interest,we also have the ability,throughour ownershi
71、p of the general partner,to control the decisions that most significantly impact MPLX.We therefore consolidate MPLX and record a noncontrollinginterest for the interest owned by the public.We also record a redeemable noncontrolling interest related to MPLXs Series A preferred units.The creditors of
72、MPLX do not have recourse to MPCs general credit through guarantees or other financial arrangements,except as noted.MPC has effectivelyguaranteed certain indebtedness of LOOP LLC(“LOOP”)and LOCAP LLC(“LOCAP”),in which MPLX holds an interest.See Note 22 for more information.Theassets of MPLX can only
73、 be used to settle its own obligations and its creditors have no recourse to our assets,except as noted earlier.11Table of Contents The following table presents balance sheet information for the assets and liabilities of MPLX,which are included in our consolidated balance sheets.(Millions of dollars
74、)March 31,2023December 31,2022AssetsCash and cash equivalents$393$238 Receivables,less allowance for doubtful accounts732 747 Inventories141 148 Other current assets64 56 Equity method investments4,144 4,095 Property,plant and equipment,net18,758 18,848 Goodwill7,645 7,645 Right of use assets274 283
75、 Other noncurrent assets1,627 1,664 LiabilitiesAccounts payable$611$664 Payroll and benefits payable 4 Accrued taxes70 67 Debt due within one year1 988 Operating lease liabilities45 46 Other current liabilities308 338 Long-term debt20,393 18,808 Deferred income taxes13 13 Long-term operating lease l
76、iabilities221 230 Deferred credits and other liabilities351 366 6.Related Party TransactionsTransactions with related parties were as follows:Three Months Ended March 31,(Millions of dollars)20232022Sales to related parties$189$19 Purchases from related parties311 282 Sales to related parties,which
77、are included in sales and other operating revenues,consist primarily of refined product sales and renewable feedstock sales tocertain of our equity affiliates.Purchases from related parties are included in cost of revenues.We obtain utilities,transportation services and purchase ethanol and renewabl
78、e fuels fromcertain of our equity affiliates.12Table of Contents 7.Earnings Per ShareWe compute basic earnings per share by dividing net income attributable to MPC less income allocated to participating securities by the weighted averagenumber of shares of common stock outstanding.Since MPC grants c
79、ertain incentive compensation awards to employees and non-employee directors that areconsidered to be participating securities,we have calculated our earnings per share using the two-class method.Diluted income per share assumes exercise ofcertain share-based compensation awards,provided the effect
80、is not anti-dilutive.Three Months Ended March 31,(In millions,except per share data)20232022Net income$3,084$1,172 Net income attributable to noncontrolling interest(360)(327)Net income allocated to participating securities(2)Redemption of preferred units(2)Income available to common stockholders$2,
81、720$845 Weighted average common shares outstanding:Basic444 564 Effect of dilutive securities3 4 Diluted447 568 Income available to common stockholders per share:Basic:Net income attributable to MPC per share$6.13$1.50 Diluted:Net income attributable to MPC per share$6.09$1.49 The following table su
82、mmarizes the shares that were anti-dilutive and,therefore,were excluded from the diluted share calculation.Three Months Ended March 31,(In millions)20232022Shares issuable under share-based compensation plans 8.EquityIn May 2021,MPC announced the authorization of a share repurchase program of up to$
83、7.1 billion.Subsequently,in February 2022,MPC approved a$5.0 billion share repurchase authorization.Both these authorizations were utilized in 2022.In August 2022,MPC approved a$5.0 billion share repurchaseauthorization and in January 2023,approved an additional$5.0 billion share repurchase authoriz
84、ation,which had combined$5.13 billion remaining available forrepurchase as of March 31,2023.These authorizations have no expiration date.We may utilize various methods to effect the repurchases,which could include open market repurchases,negotiated block transactions,tender offers,accelerated share
85、repurchases or open market solicitations for shares,some of which may be effected through Rule 10b5-1 plans.The timing and amount offuture repurchases,if any,will depend upon several factors,including market and business conditions,and such repurchases may be suspended or discontinuedat any time.13T
86、able of Contents Total share repurchases were as follows for the respective periods:Three Months Ended March 31,(In millions,except per share data)20232022Number of shares repurchased25 37 Cash paid for shares repurchased$3,180$2,846 Average cost per share$126.56$75.88 The average cost per share for
87、 the 2023 period includes a 1%excise tax on share repurchases resulting from the Inflation Reduction Act of 2022.The number of shares repurchased shown above and the amount remaining available under the share repurchase authorizations reflect the repurchase of910,402 common shares for$122 million th
88、at were transacted in the first quarter of 2023 and settled in the second quarter of 2023.9.Segment InformationWe have two reportable segments:Refining&Marketing and Midstream.Each of these segments is organized and managed based upon the nature of theproducts and services it offers.Refining&Marketi
89、ng refines crude oil and other feedstocks,including renewable feedstocks,at our refineries in the Gulf Coast,Mid-Continent andWest Coast regions of the United States,purchases refined products and ethanol for resale and distributes refined products,including renewablediesel,through transportation,st
90、orage,distribution and marketing services provided largely by our Midstream segment.We sell refined products towholesale marketing customers domestically and internationally,to buyers on the spot market,to independent entrepreneurs who operate primarilyMarathon branded outlets and through long-term
91、fuel supply contracts with direct dealers who operate locations mainly under the ARCO brand.Midstream gathers,transports,stores and distributes crude oil,refined products,including renewable diesel,and other hydrocarbon-based productsprincipally for the Refining&Marketing segment via refining logist
92、ics assets,pipelines,terminals,towboats and barges;gathers,processes andtransports natural gas;and transports,fractionates,stores and markets NGLs.The Midstream segment primarily reflects the results of MPLX.Our chief operating decision maker(“CODM”)evaluates the performance of our segments using se
93、gment adjusted EBITDA.Our CODM is the chief executiveofficer.Amounts included in income before income taxes and excluded from segment adjusted EBITDA include:(i)depreciation and amortization;(ii)net interestand other financial costs;(iii)turnaround expenses and(iv)other adjustments as deemed necessa
94、ry.These items are either:(i)believed to be non-recurring innature;(ii)not believed to be allocable or controlled by the segment;or(iii)not tied to the operational performance of the segment.Assets by segment are not ameasure used to assess the performance of the company by the CODM and thus are not
95、 reported in our disclosures.Three Months Ended March 31,(Millions of dollars)20232022Segment adjusted EBITDA for reportable segmentsRefining&Marketing$3,853$1,374 Midstream1,530 1,403 Total reportable segments$5,383$2,777 Reconciliation of segment adjusted EBITDA for reportable segments to income b
96、efore income taxesTotal reportable segments$5,383$2,777 Corporate(165)(138)Refining planned turnaround costs(357)(145)Litigation 27 Depreciation and amortization(800)(805)Net interest and other financial costs(154)(262)Income before income taxes$3,907$1,454(a)(a)14Table of Contents Three Months Ende
97、d March 31,(Millions of dollars)20232022Sales and other operating revenuesRefining&MarketingRevenues from external customers$33,663$36,792 Intersegment revenues27 36 Refining&Marketing segment revenues33,690 36,828 MidstreamRevenues from external customers1,201 1,266 Intersegment revenues1,362 1,247
98、 Midstream segment revenues2,563 2,513 Total segment revenues36,253 39,341 Less:intersegment revenues1,389 1,283 Consolidated sales and other operating revenues$34,864$38,058 Includes related party sales.See Note 6 for additional information.Three Months Ended March 31,(Millions of dollars)20232022I
99、ncome(loss)from equity method investmentsRefining&Marketing$(36)$12 Midstream169 130 Corporate Consolidated income from equity method investments$133$142 Depreciation and amortizationRefining&Marketing$464$461 Midstream317 331 Corporate19 13 Consolidated depreciation and amortization$800$805 Capital
100、 expendituresRefining&Marketing$421$244 Midstream241 283 Segment capital expenditures and investments662 527 Less investments in equity method investees207 112 Plus:Corporate7 23 Capitalized interest21 23 Consolidated capital expenditures$483$461 Includes changes in capital expenditure accruals.See
101、Note 19 for a reconciliation of total capital expenditures to additions to property,plant and equipment for the three monthsended March 31,2023 and 2022 as reported in the consolidated statements of cash flows.(a)(a)(a)(a)(a)(a)15Table of Contents 10.Net Interest and Other Financial CostsNet interes
102、t and other financial costs were as follows:Three Months Ended March 31,(Millions of dollars)20232022Interest income$(121)$(5)Interest expense334 310 Interest capitalized(23)(23)Pension and other postretirement non-service costs(23)(21)Loss on extinguishment of debt9 Investments-net premium(discount
103、)amortization(28)(1)Other financial costs6 2 Net interest and other financial costs$154$262 See Note 21.11.Income TaxesWe recorded a combined federal,state and foreign income tax provision of$823 million for the three months ended March 31,2023,which was higher than thetax computed at the U.S.statut
104、ory rate primarily due to state taxes offset by permanent tax benefits related to net income attributable to noncontrolling interests.We recorded a combined federal,state and foreign income tax provision of$282 million for the three months ended March 31,2022,which was lower than thetax computed at
105、the U.S.statutory rate primarily due to certain permanent tax benefits related to net income attributable to noncontrolling interests offset by statetaxes.12.Inventories(Millions of dollars)March 31,2023December 31,2022Crude oil$3,819$3,047 Refined products5,454 4,748 Materials and supplies995 1,032
106、 Total$10,268$8,827 Inventories are carried at the lower of cost or market value.Costs of crude oil and refined products are aggregated on a consolidated basis for purposes ofassessing whether the LIFO cost basis of these inventories may have to be written down to market values.13.Equity Method Inve
107、stmentsLF Bioenergy AcquisitionOn March 8,2023,MPC announced the acquisition of a 49.9 percent interest in LF Bioenergy,an emerging producer of renewable natural gas(“RNG”)in theU.S.,for approximately$56 million,which included funding for on-going operations and project development.LF Bioenergy has
108、been focused on developing andgrowing a portfolio of dairy farm-based,low carbon intensity RNG projects.LF Bioenergy is a VIE since it is unable to fund its operations without financial support from its equity owners.We are not the primary beneficiary of this VIEbecause we do not have the ability to
109、 control the activities that significantly influence the economic outcomes of the entity and,therefore,do not consolidate theentity.MPC accounts for our ownership interest in LF Bioenergy as an equity method investment.(a)(a)16Table of Contents 14.Property,Plant and Equipment(PP&E)March 31,2023Decem
110、ber 31,2022(Millions of dollars)GrossPP&EAccumulatedDepreciationNetPP&EGrossPP&EAccumulatedDepreciationNetPP&ERefining&Marketing$32,549$17,154$15,395$32,292$16,745$15,547 Midstream27,839 8,401 19,438 27,659 8,118 19,541 Corporate1,559 1,001 558 1,550 981 569 Total$61,947$26,556$35,391$61,501$25,844$
111、35,657 15.Fair Value MeasurementsFair ValuesRecurringThe following tables present assets and liabilities accounted for at fair value on a recurring basis as of March 31,2023 and December 31,2022 by fair valuehierarchy level.We have elected to offset the fair value amounts recognized for multiple der
112、ivative contracts executed with the same counterparty,including anyrelated cash collateral as shown below;however,fair value amounts by hierarchy level are presented on a gross basis in the following tables.March 31,2023Fair Value Hierarchy(Millions of dollars)Level 1Level 2Level 3Netting andCollate
113、ralNet Carrying Value onBalance SheetCollateralPledged NotOffsetAssets:Commodity contracts$413$2$(404)$11$59 Liabilities:Commodity contracts$469$(469)$Embedded derivatives in commodity contracts 58 58 December 31,2022Fair Value Hierarchy(Millions of dollars)Level 1Level 2Level 3Netting andCollateral
114、Net Carrying Value onBalance SheetCollateralPledged NotOffsetAssets:Commodity contracts$310$(243)$67$100 Liabilities:Commodity contracts$301$(301)$Embedded derivatives in commodity contracts 61 61 Represents the impact of netting assets,liabilities and cash collateral when a legal right of offset ex
115、ists.As of March 31,2023,cash collateral of$65 million was netted withmark-to-market derivative liabilities.As of December 31,2022,cash collateral of$58 million was netted with mark-to-market derivative liabilities.We have no derivative contracts which are subject to master netting arrangements refl
116、ected gross on the balance sheet.Level 2 instruments include over-the-counter fixed swaps to mitigate the price risk from MPLXs sales of propane.The swap valuations are based on observableinputs in the form of forward prices based on Mont Belvieu propane forward spot prices and contain no significan
117、t unobservable inputs.Level 3 instruments relate to an embedded derivative liability for a natural gas purchase commitment embedded in a keepwhole processing agreement.The fairvalue calculation for these Level 3 instruments at March 31,2023 used significant unobservable inputs including:(1)NGL price
118、s interpolated and extrapolateddue to inactive markets ranging from$0.58 to$1.55 per gallon with a weighted average of$0.77 per gallon and(2)the probability of renewal of 100 percent forthe five-year term of the natural gas purchase commitment and related keep-whole processing agreement.Increases or
119、 decreases in the fractionation spreadresult in an increase or decrease in the fair value of the embedded derivative liability.(a)(b)(a)(b)(a)(b)17Table of Contents The following is a reconciliation of the beginning and ending balances recorded for net liabilities classified as Level 3 in the fair v
120、alue hierarchy.Three Months Ended March 31,(Millions of dollars)20232022Beginning balance$61$108 Unrealized and realized gain included in net income(4)Settlements of derivative instruments(3)(5)Ending balance$58$99 The amount of total gain for the period included in earnings attributable to the chan
121、ge in unrealized losses relating toliabilities still held at the end of period:$(5)Fair Values ReportedWe believe the carrying value of our other financial instruments,including cash and cash equivalents,receivables,accounts payable and certain accruedliabilities,approximate fair value.Our fair valu
122、e assessment incorporates a variety of considerations,including the short-term duration of the instruments and theexpected insignificance of bad debt expense,which includes an evaluation of counterparty credit risk.The borrowings under our revolving credit facilities,whichinclude variable interest r
123、ates,approximate fair value.The fair value of our long-term debt is based on prices from recent trade activity and is categorized in level3 of the fair value hierarchy.The carrying and fair values of our debt were approximately$26.9 billion and$25.2 billion at March 31,2023,respectively,andapproxima
124、tely$26.3 billion and$24.0 billion at December 31,2022,respectively.These carrying and fair values of our debt exclude the unamortized issuancecosts which are netted against our total debt.16.DerivativesFor further information regarding the fair value measurement of derivative instruments,including
125、any effect of master netting agreements or collateral,see Note15.We do not designate any of our commodity derivative instruments as hedges for accounting purposes.Derivatives that are not designated as accounting hedges may include commodity derivatives used to hedge price risk on(1)inventories,(2)f
126、ixed price sales ofrefined products,(3)the acquisition of foreign-sourced crude oil,(4)the acquisition of ethanol for blending with refined products,(5)the sale of NGLs,(6)thepurchase of natural gas,(7)the purchase of soybean oil and(8)the sale of propane.The following table presents the fair value
127、of derivative instruments as of March 31,2023 and December 31,2022 and the line items in the consolidated balancesheets in which the fair values are reflected.The fair value amounts below are presented on a gross basis and do not reflect the netting of asset and liabilitypositions permitted under th
128、e terms of our master netting arrangements including cash collateral on deposit with,or received from,brokers.We offset therecognized fair value amounts for multiple derivative instruments executed with the same counterparty in our financial statements when a legal right of offsetexists.As a result,
129、the asset and liability amounts below will not agree with the amounts presented in our consolidated balance sheets.(Millions of dollars)March 31,2023December 31,2022Balance Sheet LocationAssetLiabilityAssetLiabilityCommodity derivativesOther current assets$415$469$310$301 Other current liabilities 1
130、1 10 Deferred credits and other liabilities 47 51 Includes embedded derivatives.(a)(a)(a)18Table of Contents The table below summarizes open commodity derivative contracts for crude oil,refined products,blending products,soybean oil and propane as of March 31,2023.Percentage of contractsthat expire
131、next quarterPosition(Units in thousands of barrels)LongShortExchange-tradedCrude oil68.3%98,122 102,625 Refined products82.4%14,430 17,479 Blending products98.7%2,411 2,098 Soybean oil63.7%3,509 3,946 Over-the-counterPropane%809 Included in exchange-traded are spread contracts in thousands of barrel
132、s:Crude oil-25,175 long and 24,875 short;Refined products-1,902 long and 450 short.There are nospread contracts for blending products or soybean oil.The following table summarizes the effect of all commodity derivative instruments in our consolidated statements of income:Gain(Loss)(Millions of dolla
133、rs)Three Months Ended March 31,Income Statement Location20232022Sales and other operating revenues$2$Cost of revenues61(342)Other income1 2 Total$64$(340)17.DebtOur outstanding borrowings at March 31,2023 and December 31,2022 consisted of the following:(Millions of dollars)March 31,2023December 31,2
134、022Marathon Petroleum Corporation:Senior notes$6,449$6,449 Notes payable1 1 Finance lease obligations502 522 Total$6,952$6,972 MPLX LP:Senior notes20,700 20,100 Finance lease obligations7 8 Total$20,707$20,108 Total debt$27,659$27,080 Unamortized debt issuance costs(153)(142)Unamortized discount,net
135、 of unamortized premium(226)(238)Amounts due within one year(75)(1,066)Total long-term debt due after one year$27,205$25,634(a)(a)19Table of Contents MPLX Senior NotesOn February 9,2023,MPLX issued$1.6 billion aggregate principal amount of senior notes in a public offering,consisting of$1.1 billion
136、aggregate principalamount of 5.00 percent senior notes due March 2033 and$500 million aggregate principal amount of 5.65 percent senior notes due March 2053.On February15,2023,MPLX used$600 million of the net proceeds to redeem all of its outstanding Series B preferred units.On March 13,2023,MPLX us
137、ed the remainingproceeds to redeem all of MPLXs and MarkWests$1.0 billion aggregate principal amount of 4.50 percent senior notes due July 2023.The redemption resultedin a loss on extinguishment of debt of$9 million due to the immediate expense recognition of unamortized debt discount and issuance c
138、osts.Available Capacity under our Credit Facilities as of March 31,2023(Millions of dollars)TotalCapacityOutstandingBorrowingsOutstandingLettersof CreditAvailableCapacityWeightedAverageInterestRateExpirationMPC,excluding MPLXMPC bank revolving credit facility$5,000$1$4,999%July 2027MPC trade receiva
139、bles securitization facility100 100 September 2023MPLXMPLX bank revolving credit facility2,000 2,000%July 2027 The committed borrowing and letter of credit issuance capacity of the trade receivables securitization facility is$100 million.In addition,the facility allows for the issuance ofletters of
140、credit in excess of the committed capacity at the discretion of the issuing banks.As of March 31,2023,letters of credit in the total amount of$533 million were issuedand outstanding under the facility to secure contracts awarded by the Department of Energy to purchase crude oil from the Strategic Pe
141、troleum Reserve.18.RevenueThe following table presents our revenues from external customers disaggregated by segment and product line.Three Months Ended March 31,(Millions of dollars)20232022Refining&MarketingRefined products$31,923$33,593 Crude oil1,330 2,889 Services and other410 310 Total revenue
142、s from external customers33,663 36,792 MidstreamRefined products420 497 Services and other781 769 Total revenues from external customers1,201 1,266 Sales and other operating revenues$34,864$38,058 We do not disclose information on the future performance obligations for any contract with expected dur
143、ation of one year or less at inception.As of March 31,2023,we do not have future performance obligations that are material to future periods.ReceivablesOn the accompanying consolidated balance sheets,receivables,less allowance for doubtful accounts primarily consists of customer receivables.Signific
144、ant,non-customer balances included in our receivables at March 31,2023 include matching buy/sell receivables of$4.24 billion.(a)(a)20Table of Contents 19.Supplemental Cash Flow InformationThree Months Ended March 31,(Millions of dollars)20232022Net cash provided by operating activities included:Inte
145、rest paid(net of amounts capitalized)$342$278 Net income taxes paid to(received from)taxing authorities(18)The consolidated statements of cash flows exclude changes to the consolidated balance sheets that did not affect cash.The following is a reconciliation ofadditions to property,plant and equipme
146、nt to total capital expenditures:Three Months Ended March 31,(Millions of dollars)20232022Additions to property,plant and equipment per the consolidated statements of cash flows$457$495 Increase(decrease)in capital accruals26(34)Total capital expenditures$483$461 20.Accumulated Other Comprehensive I
147、ncome(Loss)The following table shows the changes in accumulated other comprehensive income(loss)by component.Amounts in parentheses indicate debits.(Millions of dollars)PensionBenefitsOther BenefitsOtherTotalBalance as of December 31,2021$(117)$49$1$(67)Other comprehensive gain(loss)before reclassif
148、ications,net of tax of$(1)3 3(6)Amounts reclassified from accumulated other comprehensive loss:Amortization of prior service credit(11)(5)(16)Amortization of actuarial loss4 2 6 Settlement loss2 2 Tax effect1 1 Other comprehensive loss(1)(6)(7)Balance as of March 31,2022$(118)$49$(5)$(74)(Millions o
149、f dollars)PensionBenefitsOther BenefitsOtherTotalBalance as of December 31,2022$(163)$165$2 Other comprehensive gain before reclassifications,net of tax of$1 3 3 Amounts reclassified from accumulated other comprehensive loss:Amortization of prior service credit(11)(5)(16)Amortization of actuarial ga
150、in(2)(2)Settlement loss Tax effect3 1 4 Other comprehensive loss(10)(1)(11)Balance as of March 31,2023$(173)$164$(9)These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost.See Note 21.(a)(a)(a)(a)(a)(a)(a)21Table of Contents 21.Pension and O
151、ther Postretirement BenefitsThe following summarizes the components of net periodic benefit costs:Three Months Ended March 31,(Millions of dollars)20232022Pension BenefitsService cost$49$68 Interest cost29 23 Expected return on plan assets(42)(41)Amortization of prior service credit(11)(11)Amortizat
152、ion of actuarial(gain)loss(2)4 Settlement loss 2 Net periodic pension benefit cost$23$45 Other BenefitsService cost$5$8 Interest cost8 5 Amortization of prior service credit(5)(5)Amortization of actuarial loss 2 Net periodic other benefit cost$8$10 The components of net periodic benefit cost other t
153、han the service cost component are included in net interest and other financial costs on the consolidatedstatements of income.During the three months ended March 31,2023,we made no contributions to our funded pension plans.Benefit payments related to unfunded pension and otherpostretirement benefit
154、plans were$3 million and$13 million,respectively,during the three months ended March 31,2023.22.Commitments and ContingenciesWe are the subject of,or a party to,a number of pending or threatened legal actions,contingencies and commitments involving a variety of matters,includinglaws and regulations
155、relating to the environment.Some of these matters are discussed below.For matters for which we have not recorded a liability,we areunable to estimate a range of possible loss because the issues involved have not been fully developed through pleadings,discovery or court proceedings.However,the ultima
156、te resolution of some of these contingencies could,individually or in the aggregate,be material.Environmental MattersWe are subject to federal,state,local and foreign laws and regulations relating to the environment.These laws generally provide for control of pollutantsreleased into the environment
157、and require responsible parties to undertake remediation of hazardous waste disposal sites and certain other locations includingpresently or formerly owned or operated retail marketing sites.Penalties may be imposed for noncompliance.At March 31,2023 and December 31,2022,accrued liabilities for reme
158、diation totaled$383 million and$387 million,respectively.It is not presently possible toestimate the ultimate amount of all remediation costs that might be incurred or the penalties,if any,that may be imposed.Receivables for recoverable costs fromcertain states,under programs to assist companies in
159、clean-up efforts related to underground storage tanks at presently or formerly owned or operated retailmarketing sites,were$5 million at both March 31,2023 and December 31,2022.Governmental and other entities in various states have filed climate-related lawsuits against numerous energy companies,inc
160、luding MPC.The lawsuits allegedamages as a result of climate change and the plaintiffs are seeking unspecified damages and abatement under various tort theories.We are currently subjectto such proceedings in federal or state courts in California,Delaware,Maryland,Hawaii,Rhode Island and South Caroli
161、na.Similar lawsuits may be filed in otherjurisdictions.At this early stage,the ultimate outcome of these matters remains uncertain,and neither the likelihood of an unfavorable outcome nor the ultimateliability,if any,can be determined.22Table of Contents We are involved in a number of environmental
162、enforcement matters arising in the ordinary course of business.While the outcome and impact on us cannot bepredicted with certainty,management believes the resolution of these environmental matters will not,individually or collectively,have a material adverse effecton our consolidated results of ope
163、rations,financial position or cash flows.Other Legal ProceedingsIn July 2020,Tesoro High Plains Pipeline Company,LLC(“THPP”),a subsidiary of MPLX,received a Notification of Trespass Determination from the Bureau ofIndian Affairs(“BIA”)relating to a portion of the Tesoro High Plains Pipeline that cro
164、sses the Fort Berthold Reservation in North Dakota.The notificationdemanded the immediate cessation of pipeline operations and assessed trespass damages of approximately$187 million.After subsequent appeal proceedingsand in compliance with a new order issued by the BIA,in December 2020,THPP paid app
165、roximately$4 million in assessed trespass damages and ceased useof the portion of the pipeline that crosses the property at issue.In March 2021,the BIA issued an order purporting to vacate the BIAs prior orders related toTHPPs alleged trespass and direct the Regional Director of the BIA to reconside
166、r the issue of THPPs alleged trespass and issue a new order.In April 2021,THPP filed a lawsuit in the District of North Dakota against the United States of America,the U.S.Department of the Interior and the BIA(together,the“U.S.Government Parties”)challenging the March 2021 order purporting to vacat
167、e all previous orders related to THPPs alleged trespass.On February 8,2022,theU.S.Government Parties filed their answer and counterclaims to THPPs suit claiming THPP is in continued trespass with respect to the pipeline and seekdisgorgement of pipeline profits from June 1,2013 to present,removal of
168、the pipeline and remediation.We intend to vigorously defend ourselves against thesecounterclaims.We are also a party to a number of other lawsuits and other proceedings arising in the ordinary course of business.While the ultimate outcome and impact to uscannot be predicted with certainty,we believe
169、 that the resolution of these other lawsuits and proceedings will not,individually or collectively,have a materialadverse effect on our consolidated financial position,results of operations or cash flows.GuaranteesWe have provided certain guarantees,direct and indirect,of the indebtedness of other c
170、ompanies.Under the terms of most of these guarantee arrangements,we would be required to perform should the guaranteed party fail to fulfill its obligations under the specified arrangements.In addition to these financialguarantees,we also have various performance guarantees related to specific agree
171、ments.Guarantees related to indebtedness of equity method investeesLOOP and LOCAPMPC and MPLX hold interests in an offshore oil port,LOOP,and MPLX holds an interest in a crude oil pipeline system,LOCAP.Both LOOP and LOCAP havesecured various project financings with throughput and deficiency agreemen
172、ts.Under the agreements,MPC,as a shipper,is required to advance funds if theinvestees are unable to service their debt.Any such advances are considered prepayments of future transportation charges.The duration of the agreementsvaries but tend to follow the terms of the underlying debt,which extend t
173、hrough 2037.Our maximum potential undiscounted payments under these agreementsfor the debt principal totaled$171 million as of March 31,2023.Dakota Access PipelineMPLX holds a 9.19 percent indirect interest in a joint venture(“Dakota Access”)that owns and operates the Dakota Access Pipeline and Ener
174、gy Transfer CrudeOil Pipeline projects,collectively referred to as the Bakken Pipeline system or DAPL.In 2020,the U.S.District Court for the District of Columbia(the“D.D.C.”)ordered the U.S.Army Corps of Engineers(“Army Corps”),which granted permits and an easement for the Bakken Pipeline system,to
175、prepare an environmentalimpact statement(“EIS”)relating to an easement under Lake Oahe in North Dakota.The D.D.C.later vacated the easement.The Army Corps expects to releasea draft EIS in 2023.In May 2021,the D.D.C.denied a renewed request for an injunction to shut down the pipeline while the EIS is
176、 being prepared.In June 2021,the D.D.C.issuedan order dismissing without prejudice the tribes claims against the Dakota Access Pipeline.The litigation could be reopened or new litigation challenging theEIS,once completed,could be filed.The pipeline remains operational.MPLX has entered into a Conting
177、ent Equity Contribution Agreement whereby it,along with the other joint venture owners in the Bakken Pipeline system,hasagreed to make equity contributions to the joint venture upon certain events occurring to allow the entities that own and operate the Bakken Pipeline system tosatisfy their senior
178、note payment obligations.The senior notes were issued to repay amounts owed by the pipeline companies to fund the cost of construction ofthe Bakken Pipeline system.If the pipeline were temporarily shut down,MPLX would have to contribute its 9.19 percent pro rata share of funds required to payinteres
179、t accruing on the notes and any portion of the principal that matures while the pipeline is shutdown.MPLX also expects to contribute its 9.19 percent prorata share of any costs to remediate any deficiencies to reinstate the permit and/or return the pipeline into operation.If the vacatur of the easem
180、ent permitresults in a permanent shutdown of the pipeline,MPLX would have to contribute its 9.19 percent pro rata share of the cost to redeem the bonds(including the 1percent redemption premium required pursuant to the indenture governing the notes)and any accrued and unpaid interest.As of March 31,
181、2023,our23Table of Contents maximum potential undiscounted payments under the Contingent Equity Contribution Agreement were approximately$170 million.Crowley Blue Water Partners LLCIn connection with our 50 percent indirect interest in Crowley Blue Water Partners LLC,we have agreed to provide a cond
182、itional guarantee of up to 50 percent ofits outstanding debt balance in the event there is no charter agreement in place with an investment grade customer for the entitys three vessels as well as otherfinancial support in certain circumstances.As of March 31,2023,our maximum potential undiscounted p
183、ayments under this arrangement were$97 million.Other guaranteesWe have entered into other guarantees with maximum potential undiscounted payments totaling$160 million as of March 31,2023,which primarily consist of acommitment to contribute cash to an equity method investee for certain catastrophic e
184、vents in lieu of procuring insurance coverage,a commitment to fund ashare of the bonds issued by a government entity for construction of public utilities in the event that other industrial users of the facility default on their utilitypayments,a commitment to pay a termination fee on a supply agreem
185、ent if terminated during the initial term,and leases of assets containing general leaseindemnities and guaranteed residual values.Contractual Commitments and ContingenciesCertain natural gas processing and gathering arrangements require us to construct natural gas processing plants,natural gas gathe
186、ring pipelines and NGLpipelines and contain certain fees and charges if specified construction milestones are not achieved for reasons other than force majeure.In certain cases,certain producer customers may have the right to cancel the processing arrangements with us if there are significant delays
187、 that are not due to force majeure.23.Subsequent EventsAdditional$5 Billion Share Repurchase AuthorizationOn May 2,2023,we announced that our board of directors approved an additional$5.0 billion share repurchase authorization.The authorization has noexpiration date.We may utilize various methods to
188、 effect the repurchases,which could include open market repurchases,negotiated block transactions,accelerated share repurchases,tender offers or open market solicitations for shares,some of which may be effected through Rule 10b5-1 plans.The timing ofrepurchases will depend upon several factors,incl
189、uding market and business conditions,and repurchases may be discontinued at any time.24Table of Contents Item 2.Managements Discussion and Analysis of Financial Condition and Results of OperationsThis section should also be read in conjunction with the unaudited consolidated financial statements and
190、 accompanying footnotes included under Item 1.Financial Statements and in conjunction with our Annual Report on Form 10-K for the year ended December 31,2022.DISCLOSURES REGARDING FORWARD-LOOKING STATEMENTSThis Quarterly Report on Form 10-Q,particularly Managements Discussion and Analysis of Financi
191、al Condition and Results of Operations and Quantitative andQualitative Disclosures about Market Risk,includes forward-looking statements that are subject to risks,contingencies or uncertainties.You can identify forward-looking statements by words such as“anticipate,”“believe,”“commitment,”“could,”“d
192、esign,”“estimate,”“expect,”“forecast,”“goal,”“guidance,”“intend,”“may,”“objective,”“opportunity,”“outlook,”“plan,”“policy,”“position,”“potential,”“predict,”“priority,”“project,”“prospective,”“pursue,”“seek,”“should,”“strategy,”“target,”“will,”“would”or other similar expressions that convey the uncer
193、tainty of future events or outcomes.Forward-looking statements include,among other things,statements regarding:future financial and operating results;environmental,social and governance(“ESG”)plans and goals,including those related to greenhouse gas emissions,diversity and inclusion and ESGreporting
194、;future levels of capital,environmental or maintenance expenditures,general and administrative and other expenses;the success or timing of completion of ongoing or anticipated capital or maintenance projects;business strategies,growth opportunities and expected investments;consumer demand for refine
195、d products,natural gas,renewables and NGLs;the timing,amount and form of any future capital return transactions at MPC or MPLX;andthe anticipated effects of actions of third parties such as competitors,activist investors,federal,foreign,state or local regulatory authorities,or plaintiffsin litigatio
196、n.Our forward-looking statements are not guarantees of future performance,and you should not rely unduly on them,as they involve risks,uncertainties andassumptions that we cannot predict.Forward-looking and other statements regarding our ESG plans and goals are not an indication that these statement
197、s arematerial to investors or required to be disclosed in our filings with the SEC.In addition,historical,current,and forward-looking ESG-related statements may bebased on standards for measuring progress that are still developing,internal controls and processes that continue to evolve,and assumptio
198、ns that are subject tochange in the future.Material differences between actual results and any future performance suggested in our forward-looking statements could result from avariety of factors,including the following:general economic,political or regulatory developments,including inflation,intere
199、st rates,changes in governmental policies relating to refined petroleumproducts,crude oil,natural gas,NGLs or renewables,or taxation;the regional,national and worldwide availability and pricing of refined products,crude oil,natural gas,renewables,NGLs and other feedstocks;disruptions in credit marke
200、ts or changes to credit ratings;the adequacy of capital resources and liquidity,including availability,timing and amounts of free cash flow necessary to execute business plans and toeffect any share repurchases or to maintain or increase the dividend;the potential effects of judicial or other procee
201、dings on the business,financial condition,results of operations and cash flows;the timing and extent of changes in commodity prices and demand for crude oil,refined products,feedstocks or other hydrocarbon-based products,orrenewables;volatility in or degradation of general economic,market,industry o
202、r business conditions as a result of the COVID-19 pandemic,other infectious diseaseoutbreaks,natural hazards,extreme weather events,the military conflict between Russia and Ukraine,other conflicts,inflation,rising interest rates orotherwise;compliance with federal and state environmental,economic,he
203、alth and safety,energy and other policies and regulations and enforcement actionsinitiated thereunder;adverse market conditions or other risks affecting MPLX;refining industry overcapacity or under capacity;foreign imports and exports of crude oil,refined products,natural gas and NGLs;changes in pro
204、ducer customers drilling plans or in volumes of throughput of crude oil,natural gas,NGLs,refined products,other hydrocarbon-basedproducts or renewables;non-payment or non-performance by our customers;changes in the cost or availability of third-party vessels,pipelines,railcars and other means of tra
205、nsportation for crude oil,natural gas,NGLs,feedstocks,refined products and renewables;the price,availability and acceptance of alternative fuels and alternative-fuel vehicles and laws mandating such fuels or vehicles;25Table of Contents political and economic conditions in nations that consume refin
206、ed products,natural gas,renewables and NGLs,including the United States and Mexico,and in crude oil producing regions,including the Middle East,Russia,Africa,Canada and South America;actions taken by our competitors,including pricing adjustments,the expansion and retirement of refining capacity and
207、the expansion and retirement ofpipeline capacity,processing,fractionation and treating facilities in response to market conditions;completion of pipeline projects within the United States;changes in fuel and utility costs for our facilities;accidents or other unscheduled shutdowns affecting our refi
208、neries,machinery,pipelines,processing,fractionation and treating facilities or equipment,means of transportation,or those of our suppliers or customers;acts of war,terrorism or civil unrest that could impair our ability to produce refined products,receive feedstocks or to gather,process,fractionate
209、ortransport crude oil,natural gas,NGLs,refined products or renewables;political pressure and influence of environmental groups and other stakeholders upon policies and decisions related to the production,gathering,refining,processing,fractionation,transportation and marketing of crude oil or other f
210、eedstocks,refined products,natural gas,NGLs,otherhydrocarbon-based products or renewables;labor and material shortages;our ability to successfully achieve our ESG goals and targets within the expected timeframe,if at all;the costs,disruption and diversion of managements attention associated with cam
211、paigns commenced by activist investors;personnel changes;andthe imposition of windfall profit taxes or maximum refining margin penalties on companies operating in the energy industry in California or otherjurisdictions.For additional risk factors affecting our business,see the risk factors described
212、 in our Annual Report on Form 10-K for the year ended December 31,2022.Weundertake no obligation to update any forward-looking statements except to the extent required by applicable law.EXECUTIVE SUMMARYBusiness UpdateOur results through the first three months of 2023 as compared to the first three
213、months of 2022,were favorably impacted by the strong demand environment inwhich our business operates.The increase in global demand for refined products and global commodity supply constraints have continued to drive market pricesof petroleum-based transportation fuels,Refining&Marketing margins and
214、 Midstream throughputs.Supply has remained constrained for a variety of reasons,including,but not limited to,effects from refinery closures and disruptions in the crude oil and petroleum-based products markets resulting from the Russia-Ukraine conflict.We are unable to predict the potential effects
215、that the continuance or escalation of the military conflict between Russia and Ukraine,and relatedsanctions or market disruptions,may have on our financial position and results.It remains uncertain how long these conditions may last or how severe they maybecome.Strategic UpdatesLF Bioenergy Acquisit
216、ionOn March 8,2023,MPC announced the acquisition of a 49.9 percent equity interest in LF Bioenergy,an emerging producer of renewable natural gas(“RNG”)inthe U.S.,for approximately$56 million,which included funding for on-going operations and project development.LF Bioenergy has been focused on devel
217、opingand growing a portfolio of dairy farm-based,low carbon intensity RNG projects.Current projects are under various stages of development,with the first facilitynearing completion and expected to be in service in the first half of 2023.LF Bioenergys management and origination teams continue to exp
218、and the portfoliowith additional sanctioned projects while progressing their existing pipeline of opportunities toward final investment decisions.As specific project milestones areachieved,MPC is expected to fund its share of capital expenditures to build out the portfolio.Martinez Renewable Fuels P
219、roject Joint VentureThe Martinez Renewable Fuels facility reached full Phase I production capacity of 260 million gallons per year of renewable fuels during the first quarter of 2023.Pretreatment capabilities are expected to come online in the second half of 2023 and the facility is expected to be c
220、apable of producing 730 million gallons peryear by the end of 2023.26Table of Contents South Texas Asset Repositioning(“STAR”)ProjectWe completed the STAR project at our Galveston Bay refinery,which is expected to add 40 mbpd of incremental crude capacity and 17 mbpd of residprocessing capacity.Star
221、t-up activities are progressing with utilization expected to increase throughout the second quarter of 2023.Share Repurchase AuthorizationOn January 31,2023,the company announced that its board of directors had approved a$5.0 billion share repurchase authorization.Future repurchases underthis author
222、ization will depend on the macro environment,cash available after opportunities for capital investment and growth of the business and marketconditions.The authorization has no expiration date.As of March 31,2023,MPC had$5.13 billion remaining under its share repurchase authorizations.See Note 8 to t
223、he unaudited consolidated financial statements for further discussion of our share repurchase authorizations.ResultsOur CODM evaluates the performance of our segments using segment adjusted EBITDA.Amounts included in income before income taxes and excluded fromsegment adjusted EBITDA include:(i)depr
224、eciation and amortization;(ii)net interest and other financial costs;(iii)turnaround expenses and(iv)otheradjustments as deemed necessary.These items are either:(i)believed to be non-recurring in nature;(ii)not believed to be allocable or controlled by thesegment;or(iii)are not tied to the operation
225、al performance of the segment.Select results are reflected in the following table.Three Months Ended March 31,(Millions of dollars)20222021Segment adjusted EBITDA for reportable segmentsRefining&Marketing$3,853$1,374 Midstream1,530 1,403 Total reportable segments$5,383$2,777 Reconciliation of segmen
226、t adjusted EBITDA for reportable segments to income before income taxesTotal reportable segments$5,383$2,777 Corporate(165)(138)Refining planned turnaround costs(357)(145)Litigation 27 Depreciation and amortization(800)(805)Net interest and other financial costs(154)(262)Income before income taxes$3
227、,907$1,454 Net income attributable to MPC per diluted share$6.09$1.49 Net income attributable to MPC was$2.72 billion,or$6.09 per diluted share,in the first quarter of 2023 compared to$845 million,or$1.49 per diluted share,forthe first quarter of 2022.The increase in net income attributable to MPC w
228、as largely due higher Refining&Marketing margins.Refer to the Results of Operations section for a discussion of consolidated financial results and segment results for the first quarter of 2023 as compared to thefirst quarter of 2022.MPLXWe owned approximately 647 million MPLX common units as of Marc
229、h 31,2023,with a market value of$22.30 billion based on the March 31,2023 closing priceof$34.45 per common unit.On April 25,2023,MPLX declared a quarterly cash distribution of$0.7750 per common unit payable on May 15,2023,to unitholdersof record on May 5,2023.As a result,MPCs portion of this distrib
230、ution is approximately$501 million.We received limited partner distributions of$502 million from MPLX in the three months ended March 31,2023 and$456 million in the three months endedMarch 31,2022.(c)27Table of Contents During the three months ended March 31,2023,no MPLX units were repurchased.As of
231、 March 31,2023,approximately$846 million remained available underthe authorization for future unit repurchases.On February 9,2023,MPLX issued$1.1 billion aggregate principal amount of 5.00 percent senior notes due 2033 and$500 million aggregate principal amountof 5.65 percent senior notes due 2053 i
232、n an underwritten public offering.On February 15,2023,MPLX redeemed all of its 600,000 outstanding Series B preferred units at the redemption price of$1,000 per unit.The semi-annualdistribution due to Series B unitholders on February 15,2023,was also paid on that date,in the usual manner.On March 13
233、,2023,MPLX redeemed all ofMPLXs and MarkWests$1.0 billion aggregate principal amount of 4.50 percent senior notes due July 2023 at par,plus accrued and unpaid interest.See Note 4 to the unaudited consolidated financial statements for additional information on MPLX.OVERVIEW OF SEGMENTSRefining&Market
234、ingRefining&Marketing segment adjusted EBITDA depends largely on our refinery throughputs,Refining&Marketing margin,refining operating costs anddistribution costs.Refining&Marketing margin is the difference between the prices of refined products sold and the costs of crude oil and other charge and b
235、lendstocks refined,including the costs to transport these inputs to our refineries and the costs of products purchased for resale.The crack spread is a measure of the differencebetween market prices for refined products and crude oil,commonly used by the industry as a proxy for the refining margin.C
236、rack spreads can fluctuatesignificantly,particularly when prices of refined products do not move in the same direction as the cost of crude oil.As a performance benchmark and acomparison with other industry participants,we calculate Gulf Coast,Mid-Continent and West Coast crack spreads that we belie
237、ve most closely track ouroperations and slate of products.The following are used for these crack spread calculations:The Gulf Coast crack spread uses three barrels of MEH crude producing two barrels of USGC CBOB gasoline and one barrel of USGC ULSD;The Mid-Continent crack spread uses three barrels o
238、f WTI crude producing two barrels of Chicago CBOB gasoline and one barrel of Chicago ULSD;andThe West Coast crack spread uses three barrels of ANS crude producing two barrels of LA CARBOB and one barrel of LA CARB Diesel.Our refineries can process significant amounts of sweet and sour crude oil,whic
239、h typically can be purchased at a discount to crude oil referenced in our GulfCoast,Mid-Continent and West Coast crack spreads.The amount of these discounts,which we refer to as the sweet differential and sour differential,can varysignificantly,causing our Refining&Marketing margin to differ from bl
240、ended crack spreads.In general,larger sweet and sour differentials will enhance ourRefining&Marketing margin.Future crude oil differentials will be dependent on a variety of market and economic factors,as well as U.S.energy policy.The following table provides sensitivities showing an estimated chang
241、e in annual Refining&Marketing segment adjusted EBITDA due to potential changes inmarket conditions.(In millions)Blended crack spread sensitivity(per$1.00/barrel change)$1,080 Sour differential sensitivity (per$1.00/barrel change)500 Sweet differential sensitivity (per$1.00/barrel change)500 Natural
242、 gas price sensitivity (per$1.00/MMBtu)310 Crack spread based on 40 percent MEH,40 percent WTI and 20 percent ANS with Gulf Coast,Mid-Continent and West Coast product pricing,respectively,andassumes all other differentials and pricing relationships remain unchanged.Sour crude oil basket consists of
243、the following crudes:ANS,Argus Sour Crude Index,Maya and Western Canadian Select.We assume approximately 50 percent ofthe crude processed at our refineries in 2023 will be sour crude.Sweet crude oil basket consists of the following crudes:Bakken,Brent,MEH,WTI-Cushing and WTI-Midland.We assume approx
244、imately 50 percent of the crudeprocessed at our refineries in 2023 will be sweet crude.This is consumption-based exposure for our Refining&Marketing segment and does not include the sales exposure for our Midstream segment.(a)(b)(c)(d)(a)(b)(c)(d)28Table of Contents In addition to the market changes
245、 indicated by the crack spreads,the sour differential and the sweet differential,our Refining&Marketing margin is impacted byfactors such as:the selling prices realized for refined products;the types of crude oil and other charge and blendstocks processed;our refinery yields;the cost of products pur
246、chased for resale;the impact of commodity derivative instruments used to hedge price risk;the potential impact of lower of cost or market adjustments to inventories in periods of declining prices;the potential impact of LIFO charges due to changes in historic inventory levels;andthe cost of purchasi
247、ng RINs in the open market to comply with RFS2 requirements.Refining&Marketing segment adjusted EBITDA is also affected by changes in refinery operating costs in addition to committed distribution costs.Changes inoperating costs are primarily driven by the cost of energy used by our refineries,inclu
248、ding purchased natural gas,and the level of maintenance costs.Distribution costs primarily include long-term agreements with MPLX,which as discussed below include minimum commitments to MPLX,and will negativelyimpact segment adjusted EBITDA in periods when throughput or sales are lower or refineries
249、 are idled.We have various long-term,fee-based commercial agreements with MPLX.Under these agreements,MPLX,which is reported in our Midstream segment,provides transportation,storage,distribution and marketing services to our Refining&Marketing segment.Certain of these agreements include commitments
250、forminimum quarterly throughput and distribution volumes of crude oil and refined products and minimum storage volumes of crude oil,refined products and otherproducts.Certain other agreements include commitments to pay for 100 percent of available capacity for certain marine transportation and refin
251、ing logisticsassets.MidstreamOur Midstream segment gathers,transports,stores and distributes crude oil,refined products,including renewable diesel,and other hydrocarbon-basedproducts,principally for our Refining&Marketing segment.Additionally,the segment markets refined products.The profitability of
252、 our pipeline transportationoperations primarily depends on tariff rates and the volumes shipped through the pipelines.The profitability of our marine operations primarily depends on thequantity and availability of our vessels and barges.The profitability of our light product terminal operations pri
253、marily depends on the throughput volumes at theseterminals.The profitability of our fuels distribution services primarily depends on the sales volumes of certain refined products.The profitability of our refininglogistics operations depends on the quantity and availability of our refining logistics
254、assets.A majority of the crude oil and refined product shipments on ourpipelines and marine vessels and the refined product throughput at our terminals serve our Refining&Marketing segment and our refining logistics assets andfuels distribution services are used solely by our Refining&Marketing segm
255、ent.As discussed above in the Refining&Marketing section,MPLX,which isreported in our Midstream segment,has various long-term,fee-based commercial agreements related to services provided to our Refining&Marketing segment.Under these agreements,MPLX has received various commitments of minimum through
256、put,storage and distribution volumes as well as commitments to pay forall available capacity of certain assets.The volume of crude oil that we transport is directly affected by the supply of,and refiner demand for,crude oil in themarkets served directly by our crude oil pipelines,terminals and marin
257、e operations.Key factors in this supply and demand balance are the production levels ofcrude oil by producers in various regions or fields,the availability and cost of alternative modes of transportation,the volumes of crude oil processed at refineriesand refinery and transportation system maintenan
258、ce levels.The volume of refined products that we transport,store,distribute and market is directly affected bythe production levels of,and user demand for,refined products in the markets served by our refined product pipelines and marine operations.In most of ourmarkets,demand for gasoline and disti
259、llate peaks during the summer driving season,which extends from May through September of each year,and declinesduring the fall and winter months.As with crude oil,other transportation alternatives and system maintenance levels influence refined product movements.Our Midstream segment also gathers,pr
260、ocesses and transports natural gas and transports,fractionates,stores and markets NGLs.NGL and natural gas pricesare volatile and are impacted by changes in fundamental supply and demand,as well as market uncertainty,availability of NGL transportation and fractionationcapacity and a variety of addit
261、ional factors that are beyond our control.Our Midstream segment profitability is affected by prevailing commodity prices primarilyas a result of processing or conditioning at our own or thirdparty processing plants,purchasing and selling or gathering and transporting volumes of natural gasat indexre
262、lated prices and the cost of thirdparty transportation and fractionation services.To the extent that commodity prices influence the level of natural gasdrilling by our producer customers,such prices also affect profitability.29Table of Contents RESULTS OF OPERATIONSThe following discussion includes
263、comments and analysis relating to our results of operations.This discussion should be read in conjunction with Item 1.Financial Statements and is intended to provide investors with a reasonable basis for assessing our historical operations,but should not serve as the onlycriteria for predicting our
264、future performance.Consolidated Results of OperationsThree Months Ended March 31,(Millions of dollars)20232022VarianceRevenues and other income:Sales and other operating revenues$34,864$38,058$(3,194)Income from equity method investments133 142(9)Net gain on disposal of assets3(18)21 Other income77
265、202(125)Total revenues and other income35,077 38,384(3,307)Costs and expenses:Cost of revenues(excludes items below)29,294 35,068(5,774)Depreciation and amortization800 805(5)Selling,general and administrative expenses691 603 88 Other taxes231 192 39 Total costs and expenses31,016 36,668(5,652)Incom
266、e from operations4,061 1,716 2,345 Net interest and other financial costs154 262(108)Income before income taxes3,907 1,454 2,453 Provision for income taxes823 282 541 Net income3,084 1,172 1,912 Less net income attributable to:Redeemable noncontrolling interest23 21 2 Noncontrolling interests337 306
267、 31 Net income attributable to MPC$2,724$845$1,879 First Quarter 2023 Compared to First Quarter 2022Net income attributable to MPC increased$1.88 billion in the first quarter of 2023 compared to the first quarter of 2022 primarily due to higher Refining&Marketing margins in the first quarter of 2023
268、.Revenues and other income decreased$3.31 billion primarily due to:decreased sales and other operating revenues of$3.19 billion primarily due to decreased Refining&Marketing segment average refined product salesprices of$0.18 per gallon,partially offset by increased refined product sales volumes of
269、59 mbpd;anddecreased other income of$125 million primarily due to lower income on RIN sales.Costs and expenses decreased$5.65 billion primarily due to:decreased cost of revenues of$5.77 billion mainly due to lower crude oil costs:increased selling,general and administrative expenses of$88 million la
270、rgely due to increased salaries and employee related costs,equitycompensation,office expenses and insurance expenses,partially offset by decreased employee benefit costs:andincreased other taxes of$39 million primarily due to the reinstated Petroleum Superfund Tax which was effective January 1,2023.
271、Net interest and other financial costs decreased$108 million largely due to increased interest income,partially offset by increased interest expense due to higherMPLX borrowings.30Table of Contents We recorded a combined federal,state and foreign income tax provision of$823 million for the three mon
272、ths ended March 31,2023,which was higher than thetax computed at the U.S.statutory rate primarily due to state taxes offset by permanent tax benefits related to net income attributable to noncontrolling interests.We recorded a combined federal,state and foreign income tax provision of$282 million fo
273、r the three months ended March 31,2022,which was lower than thetax computed at the U.S.statutory rate primarily due to certain permanent tax benefits related to net income attributable to noncontrolling interests offset by statetaxes.Net income attributable to noncontrolling interests increased$31 m
274、illion primarily due to an increase in MPLXs net income in the first quarter of 2023.Segment ResultsWe classify our business in the following reportable segments:Refining&Marketing and Midstream.Segment adjusted EBITDA represents adjusted EBITDAattributable to the reportable segments.Amounts include
275、d in income before income taxes and excluded from segment adjusted EBITDA include:(i)depreciationand amortization;(ii)net interest and other financial costs;(iii)turnaround expenses and(iv)other adjustments as deemed necessary.These items are either:(i)believed to be non-recurring in nature;(ii)not
276、believed to be allocable or controlled by the segment;or(iii)are not tied to the operational performance of thesegment.The following shows the percentage of segment adjusted EBITDA by segment for the three months ended March 31,2023 and 2022.31Table of Contents Refining&MarketingThe following includ
277、es key financial and operating data for the first quarter of 2023 compared to the first quarter of 2022.Includes intersegment sales to Midstream and sales destined for export.(a)32Table of Contents Three Months Ended March 31,20232022Refining&Marketing Operating StatisticsNet refinery throughput(mbp
278、d)2,837 2,833 Refining&Marketing margin per barrel$26.15$15.31 Less:Refining operating costs per barrel5.68 5.22 Distribution costs per barrel5.26 4.79 Other income per barrel0.12(0.09)Refining&Marketing segment adjusted EBITDA per barrel$15.09$5.39 Less:Refining planned turnaround costs per barrel1
279、.40 0.57 Depreciation and amortization per barrel1.82 1.81 Refining&Marketing segment income per barrel$11.87$3.01 Fees paid to MPLX per barrel included in distribution costs above3.66 3.46 Sales revenue less cost of refinery inputs and purchased products,divided by net refinery throughput.See“Non-G
280、AAP Measures”section for reconciliation and further information regarding this non-GAAP measure.Includes refining operating costs and major maintenance costs.Excludes planned turnaround and depreciation and amortization expense.Includes income(loss)from equity method investments,net gain(loss)on dis
281、posal of assets and other income.The following information presents certain benchmark prices in our marketing areas and market indicators that we believe are helpful in understanding theresults of our Refining&Marketing segment.The benchmark crack spreads below do not reflect the market cost of RINs
282、 necessary to meet EPA renewablevolume obligations for attributable products under the Renewable Fuel Standard.Three Months Ended March 31,20232022Benchmark Spot Prices(dollars per gallon)Chicago CBOB unleaded regular gasoline$2.38$2.60 Chicago ULSD2.75 2.85 USGC CBOB unleaded regular gasoline2.39 2
283、.69 USGC ULSD2.87 2.98 LA CARBOB2.73 3.04 LA CARB diesel2.91 3.04 Market Indicators(dollars per barrel)WTI$75.99$95.01 MEH77.74 96.77 ANS79.02 96.31 Crack Spreads:Mid-Continent WTI 3-2-1$22.41$13.14 USGC MEH 3-2-121.19 14.96 West Coast ANS 3-2-129.63 26.46 Blended 3-2-123.36 16.53 Crude Oil Differen
284、tials:Sweet$0.28$0.11 Sour(9.23)(4.88)Blended 3-2-1 Mid-Continent/USGC/West Coast crack spread is 40/40/20 percent in 2023 and 2022.(a)(b)(c)(d)(a)(b)(c)(d)(a)(a)33Table of Contents First Quarter 2023 Compared to First Quarter 2022Refining&Marketing segment revenues decreased$3.14 billion primarily
285、due to decreased average refined product sales prices of$0.18 per gallon,partiallyoffset by increased refined product sales volumes of 59 mbpd.Net refinery throughputs increased 4 mbpd during the first quarter of 2023.Refining&Marketing segment adjusted EBITDA increased$2.48 billion primarily due to
286、 higher per barrel margins,partially offset by increased refining operatingcosts and distribution costs,both excluding depreciation and amortization.Refining&Marketing segment adjusted EBITDA was$15.09 per barrel for the firstquarter of 2023,versus$5.39 per barrel for the first quarter of 2022.Refin
287、ing&Marketing margin was$26.15 per barrel for the first quarter of 2023 compared to$15.31 per barrel for the first quarter of 2022.Refining&Marketingmargin is affected by our performance against the market indicators shown earlier,which use spot market values and an estimated mix of crude purchases
288、andproduct sales.Based on the market indicators and our crude oil throughput,we estimate a net positive impact of approximately$2 billion on Refining&Marketing margin for the first quarter of 2023 compared to the first quarter of 2022,primarily due to wider crack spreads and sour differentials.Our r
289、eportedRefining&Marketing margin differs from market indicators due to the mix of crudes purchased and their costs,the effect of market structure on our crude oilacquisition prices,the effect of RIN prices on the crack spread,and other items like refinery yields,other feedstock variances and fuel ma
290、rgin from sales to directdealers.These factors had an estimated net positive effect of approximately$600 million on Refining&Marketing segment income in the first quarter of 2023compared to the first quarter of 2022.For the three months ended March 31,2023,refining operating costs,excluding deprecia
291、tion and amortization,increased$120 million,or$0.46 per barrel,compared to the three months ended March 31,2022,largely due to project expense associated with higher turnaround activity.Distribution costs,excluding depreciation and amortization,increased$123 million,or$0.47 per barrel,and include fe
292、es paid to MPLX of$935 million and$882million for the first quarter of 2023 and 2022,respectively.Refining planned turnaround costs increased$212 million,or$0.83 per barrel,due to the scope and timing of turnaround activity.Depreciation and amortization increased$0.01 per barrel.We purchase RINs to
293、satisfy a portion of our RFS2 compliance.Our expenses associated with purchased RINs were$467 million and$574 million in the firstthree months of 2023 and 2022,respectively.The RINs expense is included in Refining&Marketing margin.The decrease in the first three months of 2023 wasprimarily due to lo
294、wer weighted average RIN costs.34Table of Contents Supplemental Refining&Marketing StatisticsThree Months Ended March 31,20232022Refining&Marketing Operating StatisticsCrude oil capacity utilization percent89 91 Refinery throughputs(mbpd):Crude oil refined2,566 2,624 Other charge and blendstocks271
295、209 Net refinery throughput2,837 2,833 Sour crude oil throughput percent41 47 Sweet crude oil throughput percent59 53 Refined product yields(mbpd):Gasoline1,508 1,483 Distillates1,024 978 Propane67 69 NGLs and petrochemicals157 161 Heavy fuel oil31 86 Asphalt84 87 Total2,871 2,864 Refined product ex
296、port sales volumes(mbpd)298 270 Based on calendar-day capacity,which is an annual average that includes down time for planned maintenance and other normal operating activities.Product yields include renewable production.Represents fully loaded export cargoes for each time period.These sales volumes
297、are included in the total sales volume amounts.MidstreamThe following includes key financial and operating data for the first quarter of 2023 compared to the first quarter of 2022.(a)(b)(b)(b)(b)(a)(b)(c)35Table of Contents On owned common-carrier pipelines,excluding equity method investments.Includ
298、es amounts related to MPLX operated unconsolidated equity method investments on a 100 percent basis.Three Months Ended March 31,Benchmark Prices20232022Natural Gas NYMEX HH(per MMBtu)$2.77$4.57 C2+NGL Pricing(per gallon)$0.77$1.15 C2+NGL pricing based on Mont Belvieu prices assuming an NGL barrel of
299、 approximately 35 percent ethane,35 percent propane,6 percent iso-butane,12 percent normalbutane and 12 percent natural gasoline.First Quarter 2023 Compared to First Quarter 2022In the first quarter of 2023,Midstream segment adjusted EBITDA increased$127 million.Results for the quarter benefited fro
300、m higher throughputs ofapproximately$51 million,higher rates of$45 million and increased income from equity method investments of$38 million,partially offset by lower NGL prices of$41 million.CorporateKey Financial Information(millions of dollars)Three Months Ended March 31,20232022Corporate$(184)$(
301、151)Corporate costs consist primarily of MPCs corporate administrative expenses and costs related to certain non-operating assets,except for corporate overhead expensesattributable to MPLX,which are included in the Midstream segment.Corporate costs include depreciation and amortization of$19 million
302、 and$13 million for the first quarter of2023 and 2022,respectively.(a)(b)(a)(a)(a)(a)36Table of Contents First Quarter 2023 Compared to First Quarter 2022In the first quarter of 2023,corporate expenses increased$33 million due to higher compensation expenses primarily associated with performance-bas
303、ed equityawards,in addition to increases in technology and communication expenses.Items not Allocated to SegmentsKey Financial Information(millions of dollars)Three Months Ended March 31,20232022Items not allocated to segments:Litigation$27 Non-GAAP Financial MeasureManagement uses a financial measu
304、re to evaluate our operating performance that is calculated and presented on the basis of a methodology other than inaccordance with GAAP.The non-GAAP financial measure we use is as follows:Refining&Marketing MarginRefining&Marketing margin is defined as sales revenue less cost of refinery inputs an
305、d purchased products.We believe this non-GAAP financial measure isused to evaluate our Refining&Marketing segments operating and financial performance as it is the most comparable measure to the industrys marketreference product margins.This measure should not be considered a substitute for,or super
306、ior to,Refining&Marketing gross margin or other measures offinancial performance prepared in accordance with GAAP,and our calculations thereof may not be comparable to similarly titled measures reported by othercompanies.Reconciliation of Refining&Marketing segment adjusted EBITDA to Refining&Market
307、ing gross margin and Refining&Marketing marginThree Months Ended March 31,(Millions of dollars)20232022Refining&Marketing segment adjusted EBITDA$3,853$1,374 Plus(Less):Depreciation and amortization(464)(461)Refining planned turnaround costs(357)(145)Selling,general and administrative expenses592 50
308、8(Income)loss from equity method investments36(12)Net gain on disposal of assets(3)Other income(51)(181)Refining&Marketing gross margin3,606 1,083 Plus(Less):Operating expenses(excluding depreciation and amortization)2,745 2,389 Depreciation and amortization464 461 Gross margin excluded from and oth
309、er income included in Refining&Marketingmargin(67)14 Other taxes included in Refining&Marketing margin(71)(43)Refining&Marketing margin$6,677$3,904 Reflects the gross margin,excluding depreciation and amortization,of other related operations included in the Refining&Marketing segment and processing
310、of credit cardtransactions on behalf of certain of our marketing customers,net of other income.(a)(a)37Table of Contents LIQUIDITY AND CAPITAL RESOURCESCash FlowsOur consolidated cash and cash equivalents balance was approximately$7.96 billion at March 31,2023 compared to$8.63 billion at December 31
311、,2022.Netcash provided by(used in)operating activities,investing activities and financing activities are presented in the following table.Three Months Ended March 31,(Millions of dollars)20232022Net cash provided by(used in):Operating activities$4,057$2,513 Investing activities(816)1,708 Financing a
312、ctivities(3,907)(2,364)Total increase(decrease)in cash$(666)$1,857 Operating ActivitiesNet cash provided by operations increased$1.54 billion in the first three months of 2023 compared to the first three months of 2022.The change in net cashprovided by operations is primarily due to an increase in o
313、perating results and an unfavorable change in working capital of$696 million when comparing thechange in working capital in both periods.For the first three months of 2023,changes in working capital,excluding changes in short-term debt,were a net$98 million use of cash primarily due to theeffects of
314、 decreasing energy commodity volumes and prices at the end of the period on working capital.Accounts payable decreased primarily due to decreasesin crude volumes and prices.Inventories increased primarily due to increases in crude and refined product inventory volumes.Current receivables decreasedpr
315、imarily due to decreases in crude volumes and prices.For the first three months of 2022,changes in working capital,excluding changes in short-term debt,were a net$598 million source of cash primarily due to theeffects of increasing energy commodity prices and volumes at the end of the period on work
316、ing capital.Accounts payable increased primarily due to increases incrude prices and volumes.Current receivables increased primarily due to higher crude and refined product prices and volumes.Inventories increased primarilydue to an increase in refined product inventories.Investing ActivitiesNet cas
317、h used in investing activities was$816 million in the first three months of 2023 compared to net cash provided by investing activities of$1.71 billion in thefirst three months of 2022.The change in net cash used in investing activities is primarily due to purchases of short-term investments of$2.11
318、billion,partially offset by maturitiesand sales of short-term investments of$1.16 billion and$631 million,respectively,in the first three months of 2023.Additions to property,plant and equipment decreased$38 million primarily due to decreased Corporate and Refining&Marketing capital expenditures.See
319、 the“Capital Requirements”section for additional information on our capital investment plan.Cash used in net investments was$207 million for the first three months of 2023 compared to$112 million for the first three months of 2022.In 2023,investments primarily included the Martinez Renewable Fuels j
320、oint venture and the acquisition of a 49.9 percent equity interest in LF Bioenergy forapproximately$56 million.In 2022,increased MPLX contributions to equity method investments included a$60 million contribution to its BakkenPipeline joint venture to fund its share of a debt repayment by the joint v
321、enture.38Table of Contents The consolidated statements of cash flows exclude changes to the consolidated balance sheets that did not affect cash.A reconciliation of additions to property,plant and equipment per the consolidated statements of cash flows to reported total capital expenditures and inve
322、stments follows.Three Months Ended March 31,(Millions of dollars)20232022Additions to property,plant and equipment per the consolidated statements of cash flows$457$495 Increase(decrease)in capital accruals26(34)Total capital expenditures483 461 Investments in equity method investees207 112 Total ca
323、pital expenditures and investments$690$573 Financing ActivitiesFinancing activities were a net$3.91 billion use of cash in the first three months of 2023 compared to a net$2.36 billion use of cash in the first three months of2022.Long-term debt borrowings and repayments were a net$553 million source
324、 of cash in the first three months of 2023 compared to a net$1.15 billionsource of cash in the first three months of 2022.During the first three months of 2023,MPLX issued$1.6 billion of senior notes and redeemed$1.0billion of senior notes.During the first three months of 2022,MPLX issued$1.5 billio
325、n of senior notes and had net payments of$300 million under its revolving credit facility.Cash used in common stock repurchases,including fees and expenses,totaled$3.18 billion in the first three months of 2023 compared to$2.85 billionin the first three months of 2022.See the“Capital Requirements”se
326、ction for further discussion of our stock repurchases.Cash used in repurchases of noncontrolling interests was$100 million in the first three months of 2022 related to the repurchase of MPLX commonunits.See Note 4 to the unaudited consolidated financial statements for further discussion of MPLX.Duri
327、ng the first three months of 2023,MPLX redeemed all of its outstanding Series B preferred units for$600 million.Derivative InstrumentsSee Item 3.Quantitative and Qualitative Disclosures about Market Risk for a discussion of derivative instruments and associated market risk.39Table of Contents Capita
328、l ResourcesMPC,Excluding MPLXWe control MPLX through our ownership of the general partner;however,the creditors of MPLX do not have recourse to MPCs general credit throughguarantees or other financial arrangements,except as noted.MPC has effectively guaranteed certain indebtedness of LOOP and LOCAP,
329、in which MPLX holdsan interest.Therefore,in the following table,we present the liquidity of MPC,excluding MPLX.MPLX liquidity is discussed in the following section.Our liquidity,excluding MPLX,totaled$16.06 billion at March 31,2023 consisting of:March 31,2023(Millions of dollars)Total CapacityOutsta
330、ndingBorrowingsOutstandingLettersof CreditAvailableCapacityBank revolving credit facility$5,000$1$4,999 Trade receivables facility100 100 Total$5,100$101$4,999 Cash and cash equivalents and short-term investments11,059 Total liquidity$16,058 The committed borrowing and letter of credit issuance capa
331、city of the trade receivables securitization facility is$100 million.In addition,the facility allows for the issuance ofletters of credit in excess of the committed capacity at the discretion of the issuing banks.As of March 31,2023,letters of credit in the total amount of$533 million were issuedand
332、 outstanding under the facility to secure contracts awarded by the Department of Energy to purchase crude oil from the Strategic Petroleum Reserve.Excludes cash and cash equivalents of MPLX of$393 million.Because of the alternatives available to us,including internally generated cash flow and access
333、 to capital markets and a commercial paper program,we believethat our short-term and long-term liquidity is adequate to fund not only our current operations,but also our near-term and long-term funding requirements,including capital spending programs,the repurchase of shares of our common stock,dividend payments,defined benefit plan contributions,repayment of debtmaturities and other amounts that