MARATHON PETROLEUM CORPORATION PROVIDES UPDATE ON STRATEGIC ACTIONS TO ENHANCE SHAREHOLDER VALUE

MPC Expects to Dropdown Assets Generating ~$1.4 Billion of EBITDA to MPLX as Soon as Practicable (Expected in 2017)

MPC Expects to Exchange its Economic Interests in the GP for MPLX LP Units in Conjunction with Completion of Dropdowns (Expected in 2017)

 

Cash Proceeds from Dropdowns and Ongoing LP Distributions Expected to Fund Substantial Ongoing Return of Capital to MPC Shareholders in a Manner Consistent with Maintaining Investment Grade Credit Profiles at MPC and MPLX

MPC to Conduct a Full and Thorough Review of Speedway

Elliott Management Endorses Value-Enhancing Plan

FINDLAY, Ohio, Jan. 3, 2017 - Marathon Petroleum Corporation (NYSE: MPC) today announced updates to the company's previously announced initiatives to enhance shareholder value.

The company announced:

• Plans to significantly accelerate its dropdown of assets with an estimated $1.4 billion of MLP-eligible annual earnings before interest, taxes, depreciation and amortization (EBITDA) to MPLX LP (NYSE: MPLX) to be completed as soon as practicable (expected in 2017), subject to requisite approvals and regulatory clearances, including tax.
   
• Completion of its initial evaluation of strategic alternatives for its MPLX general partner (GP) interests, including incentive distribution rights (IDRs), indicating it expects to exchange its economic interests in the GP for newly issued MPLX common (LP) units in conjunction with completion of the dropdowns. Details of the transaction are expected to be announced following receipt of the requisite approvals and tax clearance for all dropdowns.
   
• A special committee of the MPC Board will conduct a full and thorough review of Speedway, with the assistance of an independent financial advisor, to ensure optimum value is being delivered to shareholders over the long term. This review will include a  tax-free separation of Speedway to MPC shareholders and other strategic and financial alternatives. An update on the review is expected to be provided by mid-2017.

"Driving long-term value for our shareholders has always been and remains a top priority," said Gary R. Heminger, MPC chairman, president and chief executive officer. "We believe MPC is undervalued in the public markets and have been working diligently to execute the initiatives we announced in late October - and this work has positioned us to significantly accelerate the dropdown schedule and provide additional clarity on these transactions and other important steps.  We remain committed to taking sound, aggressive action for MPC shareholders - and we believe today's announcements will unlock substantial value. We are moving ahead expeditiously on these initiatives to further highlight the compelling value in MPC."