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MPLX LP: Key Insights for Investors

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Part 3
MPLX LP: Key Insights for Investors PART 3 OF 9

What Are MPLX’s Other Midstream Assets?

Wood River barge dock

The Wood River barge dock is located on the Mississippi River in Wood River, Illinois. It’s used both for crude oil barge loading and unloading. Two pipelines connect the barge dock to MPLX’s Wood River tank farm. One pipeline transfers crude oil from the tank farm to the dock. The other pipeline transfers products and feedstocks from the dock to the tank farm.

The dock generates revenue through a FERC (Federal Energy Regulatory Commission) tariff. The tariff is collected for transferring, loading, and unloading crude oil and products. According to a company presentation, the barge dock has ~78,000 barrels per day, or bpd, of throughput capacity.

What Are MPLX&#8217;s Other Midstream Assets?

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Neal butane cavern

The butane cavern is located in Neal, West Virginia. The storage cavern has ~1 MMbbls (million barrels) of storage capacity. It’s connected to Marathon Petroleum Corporation’s (MPC) Catlettsburg refinery. Rail access to the storage cavern is also available through Marathon Petroleum’s rail facilities.

Marathon Petroleum is the fourth largest refiner. It’s the largest refiner in the Midwest. It has a capacity of 1.7 MMbpd (million barrels per day). Other companies in the industry include Valero Energy (VLO) and Phillips 66 Partners (PSX). They also also spun off their midstream assets to form master limited partnerships, or MLPs—Valero Energy Partners (VLP) and Phillips 66 Partners (PSXP).

Valero, Phillips 66, and Marathon Petroleum are all part of the iShares Global Energy ETF (IXC). They account for 4% of the ETF.

Tank farms

MPLX also owns tank farms, or pipeline storage facilities, in Patoka, Martinsville, and Wood River, Illinois, and Lebanon, Indiana. They’re used for storing both crude oil and products. These tank farms can provide ~3.3 MMbbls of available capacity.

These storage assets also serve as “breakout tanks” for MPLX’s crude and product pipeline system. They help relieve surges in pipeline transportation. Both of these functions make the tank farms crucial for operating MPLX’s pipeline systems in these areas.

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