Marathon Petroleum Corp. (NYSE: MPC) has agreed to purchase BP's (NYSE: BP) Texas City, Texas, refinery for a base purchase price of $598 million, plus inventories estimated at $1.2 billion, Marathon Petroleum announced today.

The refinery produces 451,000 barrels per calendar day, according to the company. The deal also includes three intrastate NGL pipelines originating at the refinery, four terminals, retail marketing contract assignments for approximately 1,200 branded sites, and a 1,040-megawatt cogeneration facility. "The BP Texas City refinery is one of the largest and most complex in the U.S.," according to the Marathon press release. The company noted that the facility is "strategically positioned to provide products throughout the U.S. Gulf Coast, Midwest and Southeast, as well as into export markets. The refinery has the flexibility to process a wide range of crude oils, and has access to price-advantaged mid-continent and Canadian crudes via pipelines as well as waterborne cargoes."

The acquisition is expected to close in early 2013 and be accretive to earnings in the first year. It will be funded with cash on hand. The agreement also contains an earnout provision under which MPC could pay up to an additional $700 million over six years. Marathon Petroleum is the nation`s fifth-largest refiner, with a crude oil capacity of approximately 1.2 million barrels per calendar day in its six-refinery system.

Visit this Marathon Petroleum Web page for more information.

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