Welcome to the MPC third quarter 2023 earnings call. My name is Sheila, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Press star one on your touchtone phone to enter the queue. Please note that this conference is being recorded. I will now turn the call over to Kristina Kazarian. Christina, you may begin. Welcome to the Marathon Petroleum Corporation third quarter 2023 earnings conference call. The slides that accompany this call can be found on our website at marathonpetroleum.com under the Investors tab. Joining me on the call today are Mike Hennigan, CEO, Maryann Mannen, CFO, and other members of the executive team. We invite you to read the safe harbor statements on Slide 2. We will be making forward-looking statements today. Actual results may differ. Factors that could cause actual results to differ are included there, as well as in our filings with the SEC. References to MPC's refining utilization for the third quarter, as well as fourth quarter guidance, now include the addition of approximately 40,000 barrels a day of capacity related to STAR in our Gulf Coast region. With that, I'll turn the call over to Mike. Thank you, Christina. Good morning. Thank you for joining our call. Beginning with our view on the refining environment, in the third quarter, we saw strong demand and global supply tightness supporting refining margins. Diesel cracks led to barrels inventories remain tight and European diesel production ran below capacity. Globally, oil demand is at a record high as the need for affordable and reliable energy increases throughout the world. In our system, both domestically and within our export business, we are seeing steady demand year-over-year across the gasoline and diesel, and demand for jet fuel continues to grow. Global supply remains constrained, and global capacity additions have progressed at a slow pace. In the regions where we operate, seasonal butane blending has increased gasoline supply. However, we expect typical seasonal turnarounds to be supportive of cracks. To that end, we've seen 3.5 million barrels of gasoline inventory drawn out of the US system over the past several weeks. OPEC+ has reduced production, adding pressure to medium sour differentials. While crude differentials have generally been narrowing, we have seen WCS widen, and we're strategically situated to run heavy Canadian crude at our refineries across PADDs 2, 3, and 5. As we look towards 2024, we believe an enhanced mid-cycle environment will continue in the US due to the global supply-demand fundamentals and the relative advantages over international sources of supply, including energy costs, feedstock acquisition costs, and refinery complexity. Turning to our results, in the third quarter, we delivered strong cash generation across our business. In refining and marketing, strong margins, 94% utilization, and solid commercial performance led to segment adjusted EBITDA of four-point fil... $4.4 billion or $16.06 per barrel. Our midstream segment delivered durable and growing earnings. This quarter, it generated segment-adjusted EBITDA of over $1.5 billion. Year-to-date, our midstream segment EBITDA is up 6% compared to the prior year period. The strength of MPLX's cash flows supported its decision to increase its quarterly distribution by another 10%. With this increase, MPC is expected to receive $2.2 billion of distributions from MPLX annually. MPLX is strategic to MPC's portfolio. Its current pace of cash distributions fully covers MPC's dividend and more than half of our planned 2023 capital program. We expect MPLX's cash distribution to continue growing as it pursues growth opportunities, which will further enhance the value of this strategic relationship. We believe MPC's current capital allocation priorities are optimal for our shareholders. In the third quarter, we returned $3.1 billion to MPC shareholders via dividends and share repurchases. Last week, we announced an additional $5 billion share repurchase authorization and a 10% increase to MPC's quarterly dividend. With this increase, we have grown our quarterly dividend at over 12% compound annual rate over the past five years, which has led our refining peers. Our overall capital allocation framework remains consistent. We will invest in sustaining our asset base while paying a secure, competitive, and growing dividend. We intend to grow the company's earnings, and we will exercise strict capital discipline. Beyond these three priorities, we are firmly committed to returning excess capital through share repurchases to meaningfully lower our share count. Let me also share some of the progress on our low-carbon initiatives. The Martinez Renewable Fuels facility is being delivered safely, on time, and on budget, and by the end of 2023, the facility is expected to produce 730 million gallons per year. At that point, Martinez will be among the largest renewable diesel facilities with a competitive operating profile, robust logistics flexibility, and advantaged feedstock slate, and should benefit from the global strategic relationship with Neste. Our Dickinson renewable diesel facility is operating well. The facility processed 75% advantaged feed in the third quarter. The nearby Spiritw ood soybean processing plant, which is owned through a joint venture with ADM, is expected to deliver enough vegetable oil to produce approximately 75 million gallons per year of renewable diesel. Additionally, we are advancing early-stage developments through our interest in low-carbon intensity RNG and other small-scale investments. We believe through these projects, we're taking a disciplined steps to advance our goal to lower the carbon intensity of our operations and the products we manufacture and supply to a growing and evolving market while operating our current asset base to deliver superior cash flow and meet demands. At this point, I'll turn the call over to Maryann. Thanks, Mike. Moving to third quarter highlights. Slide five provides a summary of our financial results. This morning, we reported adjusted earnings per share of $8.14. This quarter's results were adjusted to exclude a $106 million gain on sale of MPC's 25% interest in the South Texas Gateway Terminal, as well as $63 million of response costs associated with our unplanned outage at Garyville. These adjustments reduced our reported adjusted earnings by 14 cents per share. Adjusted EBITDA was $5.7 billion for the quarter, and cash flow from operations, excluding favorable working capital changes, was over $4.3 billion. During the quarter, we returned $297 million to shareholders through dividend payments and repurchased over $2.8 billion of our shares. From May 2021 through October 2027, we have repurchased 285 million shares or approximately 44% of the shares outstanding. Slide six shows the reconciliation between net income and adjusted EBITDA, as well as the sequential change in adjusted EBITDA from second quarter 2023 to third quarter 2023. Adjusted EBITDA was higher sequentially by approximately $1.2 billion, driven by higher R&M margins. Corporate expenses were higher sequentially by $40 million, primarily due to a charge related to valuation of existing performance-based stock compensation expense. The tax rate for the third quarter was 22%, resulting in a tax provision of approximately $1 billion. Moving to our segment results, slide seven provides an overview of our refining and marketing segment. Our refining assets ran at 94% utilization, processing nearly 2.8 million barrels of crude per day at our 13 refineries. Sequentially, per barrel margins were higher across all regions, driven by higher crack spreads. Capture was 93%. Refining operating costs were $5.14 per barrel in the third quarter, flat sequentially. We did have unplanned downtime during the quarter, impacting our two largest refineries, which resulted in lost crude throughput of 4.7 million barrels due to the Galveston Bay reformer outage and 2.1 million barrels at Garyville. Additionally, this downtime resulted in a headwind to our overall capture. We began construction activities on the reformer repair about three months after the event, once regulators gave us clearance and we were able to finalize the required repairs. Since then, repairs have progressed as planned, and during this outage, we pulled forward turnaround work into the third and fourth quarters, which had been scheduled in the first quarter of 2024. Slide eight provides an overview of our refining and marketing margin capture this quarter, which was 93%. Our commercial team executed effectively despite weak secondary product pricing and refinery downtime, which weighed on capture this quarter. Capture results will fluctuate based on market dynamics. We believe that the capabilities we have built over the last few years will provide a sustainable advantage. This commitment to commercial performance is foundational, and we expect to continue to see the results. Slide nine shows the change in our midstream segment adjusted EBITDA versus the second quarter of 2023. Our midstream segment delivered strong third quarter results. Segment adjusted EBITDA was flat sequentially and 3% higher year-over-year, primarily due to higher throughputs and rates. Year to date, our midstream segment EBITDA is up 6% compared to the prior year period. As Mike mentioned earlier, the growth of MPLX's earnings supported its decision to increase its quarterly distribution by another 10% to $0.85 per unit, and MPC expects to receive $2.2 billion in cash from MPLX on an annual basis. Our midstream business continues to grow and generate strong cash flows. We are advancing high return growth projects anchored in the Marcellus and Permian Basins. Slide 10 presents the elements of change in our consolidated cash position for the quarter. Operating cash flow, excluding changes in working capital, was over $4.3 billion in the quarter. Working capital was a $609 million tailwind for the quarter, driven primarily by increases in crude oil prices. Year to date, working capital has been $1.4 billion source of cash. Capital expenditures and investments totaled $486 million this quarter, consistent with our 2023 outlook. MPC returned nearly $3.1 billion via share repurchases and dividends during the quarter. This represents an approximately 72% payout of the $4.3 billion of operating cash flow, excluding changes in working capital, highlighting our commitment to superior shareholder returns. As of 27 October 2023, we have approximately $8.3 billion remaining under our current share repurchase authorization, which includes the additional $5 billion approval announced last week. At the end of the third quarter, MPC had approximately $13.1 billion in consolidated cash and short-term investments. This includes approximately $1 billion of MPLX cash. Turning to guidance on slide 11, we provide our fourth quarter outlook. We expect crude throughput volumes of over 2.6 million barrels per day, representing utilization of 90%. Utilization is forecasted to be lower than third quarter levels due to turnaround activity having a higher impact on crude units in the fourth quarter. In the Gulf Coast, with respect to the Galveston Bay reformer, repairs have progressed as planned. We anticipate starting the unit back up in mid-November. Production is expected to ramp over the next several weeks, and guidance anticipates returning to full operating rates by mid-December, following advanced turnaround activity. As I mentioned earlier, during this outage, we plan to continue progressing and complete turnaround work that was previously scheduled for 2024. As a result, planned turnaround expense is now projected to be approximately $300 million in the fourth quarter. Operating costs per barrel in the fourth quarter are expected to be $5.60, higher sequentially, due to higher energy cost, particularly on the West Coast, as well as higher project-related expenses associated with planned turnaround activity. Distribution costs are expected to be approximately $1.4 billion for the fourth quarter. Corporate costs are expected to be $175 million, representing the sustained reductions that we have made in this area. With that, let me pass it back to Mike. In summary, we will continue to prioritize capital investments to ensure the safe and reliable performance of our assets. We'll also invest in projects where we believe there are attractive returns. Through the third quarter, we've invested over $1.7 billion in capital and investment, which includes $390 million of maintenance capital, as well as over $900 million on refinery turnarounds in 2023. Our focus on safety, operational excellence, and sustained commercial improvement will position us to capture the enhanced mid-cycle environment, which we expect to continue longer term, given our advantages over marginal sources of supply and growing global demand. MPLX remains a source of growth in our portfolio. Partnerships is expected to distribute over $2.2 billion to MPC annually, and as MPLX continues to grow its free cash flow, we believe it will continue to have capacity to increase its cash distributions to MPC. We believe MPC is positioned as the refiner investment of choice with the strongest through-cycle cash generation and the ability to deliver superior returns to our shareholders, supported by our firm commitment to return capital. With that, let me turn the call back over to Christina. Thanks, Mike. As we open the call for your questions, and as a courtesy to all participants, we ask that you limit yourself to one question and one follow-up. If time permits, we'll re-prompt for additional questions. With that, Sheila, we're ready for them. Thank you. We will now begin the question-and-answer session. If you have a question, please press Star, then one on your touch tone phone. If you wish to be removed from the queue, please press Star, then two. If you are using a speakerphone, you may need to pick up the handset first before pressing the numbers. Once again, if you have a question, please press Star, then one on your touch tone phone. Our first question will come from Manav Gupta with UBS. Your line is open. Good morning, Mike and Maryann. When we look at the refiners, they look at themselves and perform on different performance metrics. Some look at refining capture. You guys really focus on EBITDA margin per barrel. And when we look at that metric, it looks like for a second year in a row, you'll be on top of that table, outperforming your peers. So help us understand a little better, what's allowing you to drive this outperformance and deliver such strong results when it comes to EBITDA margin per barrel in your refining system? Hi, Manav, it's Rick. First of all, thank you for the perceptive call-out. I will tell you, we are uber focused on EBITDA and our results compared to others, and our team will certainly greatly appreciate your call-out on this, as they've been working on this consistently for years now, Manav, and you're seeing it pull through to our results. So kudos to the team there. I will kind of backtrack and state what we've stated in past quarters, Manav. We've made structural improvements throughout our entire commercial value chain to capture value from the front end all the way through the back end. And specifically, we're doing so in a way today that is creating a mindset change within our teams, and we are, I would say, taking more calculated risk with our approach and how we look at everything. There isn't a rock that we're not overturning to see what's under it, and we're assuming, Manav, we do everything wrong. And with that mindset, you can create a lot of value in looking at things you haven't looked at in the past. In the Midwest, specifically, I will really pivot on a couple of things. We have a fully integrated system. We have four great refineries in the Midwest, and the third quarter, as you know, they ran very well. We have access to advantage feedstocks, both Canadian and domestic. And then Brian's team has created exceptional optionality for product placement. So when you combine all those factors together, Manav, Manav, you really get to an end result that has been consistent, as you stated, over the last several quarters, and we expect it to continue. Manav, it's Mike. The only thing I would add to what Rick said is, yeah, we, we start with the EBITDA per barrel. You know, we wanna make sure we're generating as much earnings as we can as we run our assets. Ultimately, though, I care the most about cash generation. I mean, it starts with EBITDA per barrel, but the bottom line is, are we generating, you know, a significant amount of cash to give us the flexibility to drive shareholder returns? So I think you hit the starting point with EBITDA per barrel. The ending point is generating cash and, and then having that flexibility. Perfect. A quick follow-up here. You guys are known for your strong operational performance. third quarter was a little unusual. You had some unplanned incidents, and despite those, you delivered a pretty strong beat. But I'm trying to understand, let's say, those incidents would not have happened, would we have got even a stronger quarter? If you could talk about that. Yeah, thank you. It's Maryann, and thanks for the question. You know, you're right. As, as we shared with you, we did have a couple of unplanned downtime events in the quarter that impacted the Gulf Coast. One, the most significant in terms of its contribution is the Galveston Bay reformer. And then obviously, we had our Garyville. Had we not had those two impacts, and happy to share a little bit more about those in a moment here, our capture would have been 6% higher than what we reported, with the lion's share of that capture event obviously being the reformer. You know, as I mentioned, 4.7 million barrels in the quarter that we lost, and then on Garyville, it's about 2.1 million barrels as we operated at about half rate for just under a week. You know, it took us about—Just back to Galveston Bay for a moment. It took us about three months before we were able to begin our work as the regulators got through their work, and then we determined where all the repairs needed to be. So we were about three months to the start of getting those activities launched. I hope that answers the question. Thank you so much for taking my questions. You're welcome, Manav. Next, we will hear from Doug Leggate with Bank of America. You may proceed. Well, first of all, thank you for taking my questions. Maryann, that last response was actually one of the key things we wanted to hit. So let me try two more, if I may. First of all, Mike, in your opening remarks, you talked about demand in your system is pretty strong. I wonder if I could ask you to isolate that to export demand, because obviously that's a, you know, a fairly big swing factor for the US market in particular. How does that look in your system? Yeah, Doug, I'll let Brian comment on that. Doug, this is Brian. Good morning. Good question. So, you know, really our theme on demand, both domestically and internationally, is stable and steady. It's been that way really throughout the year. In the quarter, we exported roughly 250,000 barrels a day out of our system in the Gulf Coast, despite some operational challenges, as noted. About two-thirds of that is distillate. The balance, of course, is gasoline. The demand center in Latin America and the Caribbean really has been strong and resilient and growing throughout the year. They import roughly 2.3 million barrels a day into the system. The US has been about 65% of that. We have come off a little bit in terms of our share into Latin America and the Caribbean in exchange for share into Europe. So, we are seeing growth in European imports, as you've probably seen as well, roughly 200,000 barrels a day in the quarter, from the US into Europe. The one cautionary tale there, it is the one weakest spot that we see throughout our network, which is distillate demand in Europe. You know, our team sees it as roughly 4% to 6% off year-over-year, with expectations and a bit of hope that as we get into the colder weather season here later this year, we'll see a pickup in demand in Europe. But that is the one soft spot that we're seeing. Okay, that, that's helpful. And, Mike, I apologize for this one, but I guess somebody's got to ask it. So, there is speculation overnight about the CITGO process and Marathon been mentioned as a potential bidder. So, I wonder if you could frame whether that is, in fact, a consideration that you've thought about, what the rationale would be, and how you would see something like that, you know, fitting in with your portfolio high-grading focus that you've had over the last several years. Yeah, thanks, Doug. I'm gonna let Dave start, and then I'll, I'll come back afterwards. Hey, Doug. So, appreciate the question. We anticipated that. So, you know, and Mike said in the past, we like to and do look at everything out there as a general comment. But I think we're more focused currently on, and Rick touched on this a little bit, on, you know, opportunities to build out our competencies and increase our competitive advantages along our existing refinery value chains. And when we say that that's inclusive of MPC and MPLX, so from wellhead to wheel is the way to think about it. So, with that said, and on the current environment, we believe that M&A within refining, refining M&A, is one of the more challenging ways to create value. And with all that said, I would not anticipate us, or you shouldn't anticipate us participating in the current auction process for the CITGO assets. Mike, did you have a follow-up? I'll just add, I don't know where the rumor came from, but we're not interested in the auction process. All right. So best answer I could have hoped for. Thanks very much indeed. Yeah, you're welcome. Our next question will come from Paul Cheng with Scotiabank. Your line is open. Hey, everyone. Good morning. Good morning, Paul. Maybe that this is Maryann or maybe for Rick. For the West Coast, marketing, the margin condition, that seems to be very strong, and you do have a dealer network there. So just curious that in the third quarter, how much is the West Coast contribution coming from that piece of the business? Is it growing, what's your plan over there? That's the first question. Yeah, Paul, good morning. This is Brian. I'll take that one. Really very limited impact in the quarter from our marketing business on the West Coast. We actually saw prices increase pretty substantially on the West Coast in the quarter due to some unplanned outages in the system. And when that occurs, we actually see just the opposite. We see a lot of pressure on the margin out on the West Coast and other markets. So not a big contributor there in the quarter. Now, as we look ahead to fourth quarter, as market comes off, we would expect to see some recovery and some margin expansion in the fourth quarter. But to your other question, we are absolutely actively engaged in growing and continuing to grow that network. We've put up really good numbers last year and this year, and look at it as a strategic component of our position out on the West Coast. Hey, Brian, do you have any rough estimate you can share that how many stations that you're trying to grow it on an annual basis over the next several years there? Really don't want to forecast, you know, a station growth expectation, Paul. We're really focused on value growth, so it's, it's, it's really, it's a PV optimization, looking at volume and margin, so it's not driven by station growth or volume alone. Okay. I know that maybe it's still a little bit early. Can you talk about that, the plus and minuses on the variable for the CapEx outlook for the next several years compared to this year? Are we expecting a pretty steady program or that you are looking for opportunity to grow both in the maybe refining in terms of improving the yield or the reducing energy and MPLX? So can you just give us some idea that how the trend is going to look like in the CapEx and the activity level? Sure, Paul, it, it's Maryann. Let me talk a little bit about CapEx in general, and then I'll pass it to Mike, and he'll share some incremental thoughts as well. But as you know, you know, one of our principles, if you will, our strategic pillars, is strict capital discipline. And I think that has, hopefully, you've seen that we have implemented that principle well over the last few years. When you look at 2017 to 2020, you know, our consolidated CapEx averaged about $3.5 billion, and as you look 2021 to 2023, you know, that's averaged $2.1 billion. So, you know, again, that premise of strict capital discipline, ensuring that we're delivering the returns, has been an important piece of the work that we've been doing. I think in refining, we continue to look for cost reduction-type projects, those that can enhance reliability, margin enhancement-type projects, then that we would be continuing to evaluate, and there are several of those projects that we'll evaluate. In terms of the timing, you know, we're a bit early for 2024, frankly, even 2025 guidance. But let me pass it to Mike, as I think he wants to give you some incremental color on how he's thinking about it. I think, Maryann, you answered it very well. Paul, the way we think about it is on the MPLX side of the house, you know, we've been spending, you know, roughly about $1 billion, and growing those cash flows. If you listen to the MPLX call, you know, we're still very comfortable with, you know, those cash flows growing. That'll continue to kick over to MPC via distribution. And then Maryann said it well, on the refining side of the house, we're still very optimistic that we have some good projects that enable us to either increase reliability, which will hit the bottom line, or, you know, enhance our margins in such a way that we talked about earlier, that will generate more EBITDA per barrel. So we have a pretty fulsome look at where we think we're gonna invest. You know, like Mary just gave you the numbers over the last couple of years, you're spending $2 to 3 billion overall on a consolidated basis. We think that's a nice base case to have, and then we always look to to optimize around that. When we do that, you know, we generate sufficient free cash flow that we can still, you know, return capital, you know, via dividends and, and buybacks. And as you've seen, you know, in this enhanced margin environment, that's part of our DNA, to return capital to shareholders. Thank you. You're welcome. Our next question comes from Sam Margolin with Wolfe Research. Your line is open. Good morning. Thanks for taking the question. Question's on the buyback, and it's kind of conceptual, you know, just sort of how you think about the stock when you do your internal process. But, you know, when you are looking at an MPC share, the question is really how do you view it? Or, you know, what does it represent to you? Is it representative of just the parent company and a repository for MPLX distributions? Or do you kind of analyze it as a consolidated entity where, you know, something like 40% of it is like a synthetic MPLX share? And the reason I ask is because we do get a lot of questions about sort of your price sensitivity in the buyback, and, and I think the methodology maybe is important. Thanks. Sam, it's Maryann. Let me give you a few thoughts on that, and I can pass it to Mike in case he's got some added value. I mean, there are several things that we look at as we are making decisions about the level of share buyback. And certainly, when we're looking at intrinsic value, you know, there's a couple of approaches. So, we'll look at some of the parts, we'll look at discounted cash flows. We use a series of reviews, obviously, looking at our EBITDA multiples of their respective businesses. But typically, when we are making the decision about an MPC buyback, you know, that intrinsic value assumes the discounted cash flows as I just shared. You know, there are several constraints, as we look at that, that we evaluate each time we go to buy back stock, none the least of which, obviously, is market, cash flows, where we think the quarter is going to be, where we think our cash balances are, and we've worked pretty diligently to try to outperform the market here. Hopefully, you've seen that, you know, over the significance of the buyback that we've done. But we do look at it in a holistic approach. Let me pass that back to Mike and see if he wants to add any color. Yes, Sam. Here's the way I think about it. As you know, we don't control the margins, so as the, you know, quarter progresses, we don't have a specified amount that says we're gonna do X in this quarter, other than we've been trying to be as aggressive as we possibly can within the constraints that the SEC puts on us, such as, you know, daily volume traded limitations or blackout periods, et cetera, et cetera. So we've been, because it kind of looks like it's been consistent, you know, just because we've been trying to be as aggressive as possible. You know, once we generate the cash, as we talked to Paul's question, we have our, you know, dedication that we want to invest capital in, and then we wanna be, you know, returning capital to shareholders as quickly as we can. At the same time, I will tell you that we also still try to beat the market. You know, one of our goals is be as aggressive as we can, return capital, but take advantage of the volatility that's within the quarter. And, you know, since we started this program, you know, we've ended up reducing the share count by about 40%. You know, it's a rough number, and during that process, we've kind of beat the market by about $4. So, if you say, "Hey, we've reduced somewhere around, you know, 270 million shares at around four dollars," it's roughly about $1 billion of value creation just in our execution. But it starts with obviously generate cash, figure out how much we can return to shareholders as quickly as we can within those constraints, and then try our best to beat the market during that execution. I hope that helps. Yeah, very much so. Thanks. And my follow-up is just, you know, more of a straightforward ops question, but it's about the West Coast and, TMX. You know, TMX has been delayed, it. But, you know, once it starts up, it might be impactful to fundamentals on the West Coast. And it seems noteworthy because of your comments about how the Midwest is this integrated system with, you know, shipper status for WCS, and you're able to move things around. And so, I wonder, in the context of TMX, if there's kind of, if you see any analogs there with, with building out, sort of a full value chain or, or commercial, integrated platform. Thanks. Yeah. Hi, Sam, it's Rick. Your analogy is spot on. So when TMX comes online, we'll not only see benefits in the Pacific Northwest, specifically at Anacortes and at LA. So the way we look at it is you're going to get access to an advantage barrel, more so than what you do today, and we believe that barrel will compete very well, especially on the West Coast. We believe TMX will have some start-up issues. They have some well-publicized marine hurdles they need to get over. And with that being said, having that barrel clear all the way to Asia will be difficult, and sitting on the West Coast, we have a structural advantage from a transportation cost perspective. So we do see that playing into both of our assets, one in the Pacific Northwest and L.A. on the West Coast. Thank you so much. You're welcome. Thank you, Sam. Next, we will hear from Roger Read with Wells Fargo. Please go ahead. Roger, we're not able to hear you in conference. Please check the mute feature on your phone. Okay, hopefully it works this time. Can you hear me all right? Yeah, we got you, Roger. All right. Thank you. I'd like to come back around on the renewable diesel. You know, we heard from others and seen some stories about permit issues. Just curious, you can kind of walk us through the way we should be thinking about that as we head into startup, kind of year-end and in early part of 2024. Hey, Roger, this is Jim Wilkins. We're working with the county on one issue related to our land use permit that issue we expect will get resolved in the upcoming months, and it's related to our odor mitigation plan. The resolution of that matter won't impact our ability to construct or operate the facility. Does it change at all the feedstock that you'd be able to use early on? No. I'm not terribly experienced with this, but I know that, that some of the feedstocks are, well, let's just say they're not what you would want to smell, I guess. No, Roger. So, we actually have an approved odor mitigation plan with the Air Quality Division, and actually what we're doing is circling back to the land use permit, where we said we'd develop an odor mitigation plan and embedding the plan that's already been approved. Okay, perfect. So, no, and just to be absolutely clear, no other regulatory hurdles that need to be cleared for startup? Correct. Great. Thank you. You're welcome, Roger. Our next question comes from John Royal with JPMorgan. Your line is open. Hi, good morning. Thanks for taking my question. So I had a my first one to follow up on the buyback. You've, you've now gotten through another quarter with a a really solid crack environment in third quarter, and another quarter where you aren't drawing any cash. And in fact, you built cash by about, I think, $1.5 billion, which I wouldn't characterize as a problem by any stretch. But you've talked about getting that cash balance down closer to $1 billion longer term, and Mike talked about the constraints to doing more on the buyback. And now we're seeing a worsening environment in fourth quarter. So, my question is, given all your excess cash, should we think about the buyback as not particularly sensitive to the crack environment? Would you expect to start drawing cash from here? Hey, John, it's Maryann. So a couple of things. Yes, you're absolutely right. As you see, we set a little over $13 billion at the end of the quarter. And again, just keeping in mind, about $1 billion of that belongs to MPLX. And then obviously there is some working capital sensitivity as we have timing of our liability payments. We would expect to see a bit of that unwind as normal. You know, we'll see some of that happen in the fourth quarter, and then again in the first quarter. Having said that, your point is, you know, accurate. We've said we're quite comfortable with $1 billion on our balance sheet. The nice part about having the cash on the balance sheet today versus if we were sitting here a year ago is, you know, we're generating close to $500 million in interest income as we're holding on to that cash. You know, so certainly, you know, when we are looking at the amount of share buyback that we want to do in any particular period of time, and I think Mike articulated it as well, we're looking at several factors. You know, the, the fact that we've got cash on the balance sheet to allow us to take advantage of volatility, I think is a plus. You know, we remain committed to share repurchase and the return of capital. You know, we've got some priorities. Obviously, safe and reliable operation of our assets gets it first. You know, we're committed to our dividend, as we just shared with you, and we're looking for opportunities to put that capital to work in order to be able to grow the business, and particularly, earn the types of returns that you all expect. We continue to see share buyback as an efficient return of capital. Again, we'll look at all factors, as we head into any particular quarter and try to be as opportunistic as we can, and be sure that we are doing our best to beat the market and taking advantage of the volatility where we can. Great. Thank you. And then, Maryann called out some turnaround work pulled in from next year to the second half of this year. And so just thinking about next year, any early look on what 2024 could look like from a turnaround perspective? I think you had some catch up over the past two years, and now there's work pulled into 2023. So, is it reasonable to think it might be kind of a below average year? Hey, John, Maryann again. So you know, in general, notwithstanding the impact of COVID, if you look over an average period of time, you know, our, our turnaround is pretty similar. You know, we're operating 13 refineries, fossil fuel, and two renewable diesel. And at every point in time, you know, there is some level of turnaround. You're absolutely right. One of the things that we did, notwithstanding the unplanned downtime on the reformer, is pull forward some turnaround that we expected to do in our 2024 plans into 2023. But again, absent, you know, the period of COVID, you know, you can see the level of turnaround being pretty similar, you know, watching those. In the fourth quarter also, you may have noticed, you know, in our guidance, you know, West Coast utilization, we do have turnaround activity there. You know, we've got two locations in LAR. We are trying to get those turnarounds done ahead of the driving season next year. Just as an example, if you're looking at, you know, activity in the fourth quarter as well. I'll pause there. Yeah, thank you. You're welcome, John. Our next question comes from Jason Gabelman with TD Cowen. Your line is open. Hey, morning. Thanks for taking my questions. Decent amount of focus on the buyback. I wanted to ask about the dividend raise of 10%. You know, last year, the dividend raise was higher in line with the amount you had repurchased over the trailing twelve months. This year, that wasn't the case, and, you know, it's also, I guess, lower than the incremental cash you'll be receiving from MPLX with their higher distribution. So the question is, how do you think about kind of that dividend raise? How did you come up with that 10%? How do you think about it moving forward, especially in light of the commentary that you expect the refining environment, the mid-cycle environment to be higher, and I would expect the dividend moving higher would be a good way to message that earnings power to the market? Jason, it's Mike. I'll start, and I'll let Mary jump in. Yeah, I, I think what you're referring to is, you know, we had a bigger increase before, cause the way we looked at it is, you know, most in our industry kind of paused around COVID, you know, during that tough year of cash. So, we made a bigger jump, and now what we show in this year is, we're trying to show the market that we believe in a growing dividend that is, you know, part of our capital allocation. You know, we want it to be competitive, but at the same time, you know, I often say that it's more tax efficient to go, you know, return capital through share repurchases. And, you know, the sheer quantum of dollars in each case is, you know, pretty different. So, you know, overall, we want the market to know, yeah, we're gonna grow the dividend. We're gonna consistently do that. We want it to be competitive. We wanna show that we're gonna grow earnings. That comes back to investing capital and all the self-help that we can do. But at the same time, we're gonna err more on the side of share repurchases because we think it's more tax efficient and a better way to return capital. Yeah, Jason, it's Mary. And the only thing that I would add to Mike's comments are, you know, the dividend is only one part, as you said, of the capital allocation strategy. But, you know, having said that, we think this increase is purely leading at 12% CAGR over the last five years. So we hope you see it that way as well. Got it. Thanks. Thanks for that. And then my follow-up is on one of the growth projects that I think you have for next year, the Hydrogen Hub project that was selected for funding from the DOE. I was hoping just to get more color on exactly what Marathon's participation is in that project, how it could benefit the company, any thoughts around capital spending that you would have to contribute there? Thanks. Yeah, Jason, this is Dave. I'll touch on that. So, start with high level. Number one, there are seven hubs that were approved for funding from the DOE for $7 billion. We mean MPC/MPLX, we're involved in two of them, so one in Appalachia and one in the Heartland area. So when we think about the involvement of MPC and MPLX, they're a little bit different. On the MPLX side, it's more around storage of hydrogen and transportation of CO2 on pipelines. From an MPC perspective, it is inclusive of lowering the carbon intensity of via hydrogen production. And when you think about it, in the Heartland area, due to the location of it, it's very the proximity, very close to our Dickinson renewable diesel facility. So of course, anytime you can lower the CI of the base product you're making from renewable diesel, you can get that pull-through value of that asset that we already invested in. So best way to think about it, like we do everything, these are bolt-on type investments that can create value up and down the value chains. Okay. When, when should we see those benefits start to accrue? When, when do the projects come online? Yeah, so that's great. So, while this DOE funding was a major milestone for all of us that got granted some funding from this, it's in the very early stages. So, to think about it, next phase of this is negotiation with the DOE on the funding and the contractual commitments around that funding requirement. Then you've got to design and build the facility. So, from a capital spend and a associated benefit to the company, I think you're looking into, you know, late 2024, 2025 timeframe. So, it's still a ways out there. Great. Thanks. That's really helpful. Thank you. Our next question comes from Theresa Chen with Barclays. Your line is open. Morning. I wanted to follow up on Sam's question related to TMX, for which MPC it has a known commitment. I was just wondering if you could update us with where you think the toll may settle out at, given the discussion with the pipeline owner and the PDASF currently. Related to that, you know, how much do you think really it can tighten WCS differentials for your MidCon assets, given that the coast tolls are comparable to going to the US Gulf Coast versus Burnaby? Yeah. Hi, Theresa, it's Rick. So on the first part of your question, I'm just really not in a position to comment on the toll or speculate what it may end up at. On the second part of your question, the guidance I'd give you is you know, as we look at the forward curve on WCS, so today, WCS sits at about a $26 discount. In first quarter, it's ±25, and in second quarter, if TMX comes online there, and I think the market is still questionable on that, the forward curve's $15 to 18 discount. So still a pretty significant discount, and we'll just have to see where it goes from there. Got it. And going back to Mike's earlier comments about additional investment opportunities, RNG being one of them, can you guys just give us an update on progress related to the LF Bioe nergy assets after the, you know, first quarter acquisition announcement? How that's trending, and do you expect to use this as a launchpad for additional RNG investments, or is this going to be more of a roll-up strategy from here? Yeah, Theresa, this is Dave again. I'll touch on that. So, yeah, the LF Bioe nergy investment, that joint venture is progressing as we planned. We are building out the facilities. The plan is to build out 13 of those RNG facilities, collecting a very low CI dairy RNG, and then, you know, monetizing that. Again, very-- as I touched on a little bit with the hydrogen hub, taking that RNG into our renewable diesel facilities, such as Dickinson and Martinez, will lower the CI of that base renewable diesel project- product coming out. So, relative to the relationship and the investment, we're very happy with the investment, the management team there, the projects we've that they're identifying. They've got a good runway of portfolio of projects, and they're coming online as planned. So, the second part of your question is, is this a, you know, one-off or a foundation for subsequent investments in renewable diesel space or the renewable natural gas space? We continue, as I said earlier, we look at a lot of stuff. There are some opportunities out there, but we—the key to this one was we got in early, and didn't overpay for a built-out system. So, when we think of subsequent investments, I'd think of them that way. If there's one that we can step in early and participate in the build-out of the infrastructure and integrate it with our business rather than paying for a built-out system, we'll continue to evaluate those opportunities. Our next question comes from Matthew Blair with TPH. Your line is open. Good morning. Thanks for taking my question. Maybe sticking with the renewables, you know, for some operators, the, the next leg of the RD story is moving into SAF. Is that an option for Martinez? And if so, any thoughts on, you know, timing or, or cost to, to add that flexibility? Yeah, Matthew, this is Dave again. So, yeah, there is no question, both from a Dickinson and Martinez, both those have the opportunity to convert to SAF, and, HEFA SAF is one of the most cost competitive on a, on a CapEx, per barrel basis, for SAF production. With that said, the challenge in SAF is the premium associated to justify the investment. And while the IRA has, you know, been communicated, there's a lot of unknowns out there and a lot of clarity that still needs to be determined, relative to the IRA, not only from the, the sliding scale and the CI benefit, of it, but also the long-term duration. Right now, it ends in 2027 as far as the documented, incentives relative to that. So it's hard to make, you know, $multi-hundred million investments without that clarity going forward. So lack of clarity and lack of premium from airline industry makes it very difficult to justify those investments at this time. Hey, Matthew, it's Mike. I'll just add to your and to Theresa's question. You know, I think what you're trying, or hopefully what you're seeing from us, is we're attentive to this whole low-carbon world, whether it's investment in RNG, like Theresa talked about, or as Dave just mentioned. You know, SAF, in my opinion, is, you know, going to happen at some period. You know, as Dave said, there's a little bit of wrangling around the economics of it at this point, but, you know, when those opportunities present themselves to us, we'll continue to optimize our portfolio. So I think if you take a stairstep over time, you're going to see us continue to be conscious of that, at the same time, recognizing, you know, that the base business is still the majority of what we do. But over time, we're going to continue to look, whether it's RNG, whether it's SAF, whether it's continued build-out in some other areas, those are things that we continue to evaluate. Dave and his team is constantly looking at it, and we'll make some investment there. But we're not looking for the big splash of a major investment. As Dave just said, we're not looking to buy something that's already been proven out. We're looking to get ourselves in and grow with those opportunities. Sounds good. Then, do you have any early thoughts on refining margin capture into the fourth quarter? Do you think it would be up on tailwinds from things like butane blending and getting the reformer back for at least part of the quarter? Hey, Matthew, it's Maryann. Yeah, I think, you know, it's hard for us to, to project capture, but when you talk about the things you did, obviously, as we shared, the reformer we expect will begin to come back up mid-November. Our guidance reflects the fact that, you know, it will be operational at planned rates mid-December. We talked about some secondary headwinds. We talked about marketing margins changes—changing. You heard Brian talk about that as well. You know, those things clearly have a positive influence on capture. But as you know, it's, it's, it's difficult to predict where capture would, would otherwise go, but, but certainly those things point to improving capture from the third quarter. We do have time for just one more question. Our last question will come from Ryan Todd with Piper Sandler. Your line is open. Great, thanks. Maybe if I could have one follow-up on the Martinez conversion project. Can you talk about where you are from an operational point of view there? Maybe how much throughput you had in during the third quarter from phase one of the project? And maybe as we think about startup of phase two of that project by the end of this year, is there any ramp that we should associate with it either in terms of total throughput or in terms of the type of feeds that you anticipate, you know, working their way into the system? So, how should we think about the progress from an operational point of view for that asset? Okay, Ryan, this is Tim Aydt. Thanks a lot for the question there. I would say that, first off, the project is going exceptionally well, both from a safety and on time and on budget, standpoint. The team's really doing a great job, and I do wanna give them a shout-out because it really kind of demonstrated, one of Marathon's key strengths here, and that's that they can execute on a complex project. We did, as you likely know, start up the pretreatment unit in late second quarter, and it is operating very well. We're able to pretreat the entire production that comes about with the phase one Martinez capacity. Now we're gonna be looking to ramp that pretreatment capacity, or, you know, with the production of RD that's coming on, you know, toward the end of the year when we finish the project. And as Maryann said earlier, when we do finish the project, we're gonna be able to produce 730 million gallons annually, and that should happen by the end of the year. So, all in all, operationally and project-wise, we're moving forward, wrapping it up, and we'll be ready at the end of the year. Great. Thank you. You're welcome. All right. With that, thank you so much, everyone, today for your interest in Marathon Petroleum Corporation. Should you have additional questions or would you like clarification on topics discussed this morning, please reach out and our team will be available to take your calls. Thanks so much for joining us. Thank you. That does conclude today's conference. Thank you for participating.