XML 34 R20.htm IDEA: XBRL DOCUMENT v3.7.0.1
Segment Information
 3 Months Ended
Mar. 31, 2017
Segment Reporting [Abstract]  
Segment Information
Segment Information
In the first quarter of 2017, we revised our segment reporting in connection with the contribution of certain terminal, pipeline and storage assets to MPLX. The operating results for these assets are now reported in our Midstream segment. Previously they were reported as part of our Refining & Marketing segment. Comparable prior period information has been recast to reflect our revised presentation. The results for the pipeline and storage assets were recast effective January 1, 2015 and the results for the terminal assets were recast effective April 1, 2016. Prior to these dates these assets were not considered businesses and therefore there are no financial results from which to recast segment results.
We have three reportable segments: Refining & Marketing; Speedway; and Midstream. Each of these segments is organized and managed based upon the nature of the products and services it offers.
•
Refining & Marketing – refines crude oil and other feedstocks at our seven refineries in the Gulf Coast and Midwest regions of the United States, purchases refined products and ethanol for resale and distributes refined products through various means, including pipeline and marine transportation, terminal and storage services provided by our Midstream segment. We sell refined products to wholesale marketing customers domestically and internationally, to buyers on the spot market, to our Speedway segment and to independent entrepreneurs who operate Marathon® retail outlets.
•
Speedway – sells transportation fuels and convenience merchandise in retail markets in the Midwest, East Coast and Southeast regions of the United States.
•
Midstream – includes the operations of MPLX and certain other related operations. The Midstream segment gathers, processes and transports natural gas; gathers, transports, fractionates, stores and markets NGLs; and transports and stores crude oil and refined products principally for the Refining & Marketing segment.
Segment income represents income from operations attributable to the reportable segments. Corporate administrative expenses, except for those attributable to MPLX, and costs related to certain non-operating assets are not allocated to the reportable segments. In addition, certain items that affect comparability (as determined by the chief operating decision maker) are not allocated to the reportable segments.

(In millions)
Refining & Marketing
 
Speedway
 
Midstream
 
Total
Three Months Ended March 31, 2017
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
Customer
$
11,373

 
$
4,383

 
$
532

 
$
16,288

Intersegment(a)
2,590

 
1

 
344

 
2,935

Segment revenues
$
13,963

 
$
4,384

 
$
876

 
$
19,223

Segment income (loss) from operations(b)
$
(70
)
 
$
135

 
$
309

 
$
374

Income from equity method investments
2

 
13

 
42

 
57

Depreciation and amortization(c)
267

 
64

 
191

 
522

Capital expenditures and investments(d)(e)
192

 
35

 
1,070

 
1,297

(In millions)
Refining & Marketing
 
Speedway
 
Midstream
 
Total
Three Months Ended March 31, 2016
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
Customer
$
8,406

 
$
3,950

 
$
399

 
$
12,755

Intersegment(a)
2,165

 
1

 
232

 
2,398

Segment revenues
$
10,571

 
$
3,951

 
$
631

 
$
15,153

Segment income (loss) from operations(b)
$
(86
)
 
$
167

 
$
189

 
$
270

Income (loss) from equity method investments
(1
)
 
—

 
23

 
22

Depreciation and amortization(c)
273

 
63

 
140

 
476

Capital expenditures and investments(d)
243

 
50

 
350

 
643

(a) 
Management believes intersegment transactions were conducted under terms comparable to those with unaffiliated parties.
(b) 
Corporate overhead expenses attributable to MPLX are included in the Midstream segment. Corporate overhead expenses are not allocated to the Refining & Marketing and Speedway segments.
(c) 
Differences between segment totals and MPC totals represent amounts related to unallocated items and are included in “Items not allocated to segments” in the reconciliation below.
(d) 
Capital expenditures include changes in capital accruals, acquisitions (including any goodwill) and investments in affiliates.
(e) 
In the first quarter of 2017, the Midstream segment includes $220 million for the acquisition of the Ozark pipeline and an investment of $500 million in MarEn Bakken related to the Bakken Pipeline system.
The following reconciles segment income from operations to income before income taxes as reported in the consolidated statements of income:
 
Three Months Ended 
 March 31,
(In millions)
2017
 
2016
Segment income from operations
$
374

 
$
270

Items not allocated to segments:
 
 
 
Corporate and other unallocated items(a)
(82
)
 
(65
)
Pension settlement expenses
—

 
(1
)
Impairments(b)
—

 
(129
)
Net interest and other financial income (costs)
(150
)
 
(142
)
Income (loss) before income taxes
$
142

 
$
(67
)
(a) 
Corporate and other unallocated items consists primarily of MPC’s corporate administrative expenses and costs related to certain non-operating assets, except for corporate overhead expenses attributable to MPLX, which are included in the Midstream segment. Corporate overhead expenses are not allocated to the Refining & Marketing and Speedway segments.
(b) 
See Note 14 for further information on the impairment of goodwill in the three months ended March 31, 2016.

The following reconciles segment capital expenditures and investments to total capital expenditures:
 
Three Months Ended 
 March 31,
(In millions)
2017
 
2016
Segment capital expenditures and investments
$
1,297

 
$
643

Less investments in equity method investees(a)
566

 
209

Plus items not allocated to segments:
 
 
 
Corporate and Other
16

 
24

Capitalized interest
12

 
17

Total capital expenditures(b)
$
759

 
$
475


(a) 
The three months ended March 31, 2017 includes an investment of $500 million in MarEn Bakken related to the Bakken Pipeline system. The three months ended March 31, 2016 includes an adjustment of $143 million to the fair value of equity method investments acquired in connection with the MarkWest Merger.
(b) 
Capital expenditures include changes in capital accruals. See Note 17 for a reconciliation of total capital expenditures to additions to property, plant and equipment as reported in the consolidated statements of cash flows.