“what is expected from legal counsel in changing times”
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“What Is Expected From Legal Counsel in Changing Times”. Gary R. Heminger President Marathon Petroleum Company Corporate Law Leadership Forum April 22, 2009. Global Operations. The Reach and Scope of Marathon. 35 Attorneys. 26,000 Employees. The few, the proud, the in-house counsel. - PowerPoint PPT PresentationTRANSCRIPT
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“What Is Expected From Legal Counsel in Changing Times”
Gary R. Heminger President
Marathon Petroleum CompanyCorporate Law Leadership Forum
April 22, 2009
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Global Operations
Exploration
Production
Exploration/Production
Integrated Gas
Refineries
Oil Sands Mining
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The Reach and Scope of Marathon
The few, the proud, the in-house counsel
35 Attorneys
26,000 Employees
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Challenges to Legal CounselProduct Liability
Price Gouging
Protection of Intellectual Property
New Regulations Constraining Advocacy Efforts
Ethics Leadership
Sarbanes Oxley Compliance
Guidance on Contracts and Legislative Initiatives
Anti-trust
Mergers and Acquisitions
Environmental Law
Personal Injury
Medical Monitoring
PMPA and Marketing
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The key expectation –
“Understand the business!”
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Industry Jobs
Direct Industry Total Job Chain
Oil:1.84 million
Auto:Approximately
3 million
Oil:Approximately
5.9 million
Auto:1.1 million
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New Projects, New Jobs, New Energy
Garyville Major Expansion Detroit Heavy Oil Upgrade Project
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Cost of Delay
Additional Adverse Results
Deferred benefits
Time value of investment dollar
Competitor advantage
Typical Cost of Project Delay
Sal
es
Time
With delay
Without delay
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Our Industry is an Industry of Price Takers
Source: NYMEX (WTI crude oil) and AAA (gasoline a diesel)
Threat of Iraq Embargo
Iraq War OPEC Cuts
Hurricane Katrina
Non-OPEC disruptions
Open interest contracts soar
Iran tests missiles
Hurricane Ike
Events drive price
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Annual Price and Margin Sensitivities$ Millions (After Tax)
Refined products wholesale margin sensitivity(per penny a gallon change) $137
Speedway SuperAmerica light product margin(per penny a gallon change) $21
LLS 6-3-2-1 crack spread(per dollar a barrel change) ~$280
Sweet/Sour Oil Cost Differential(per dollar a barrel) ~$110
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Price Discovery
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The Popular View of Price Gouging
“Florida fields hundreds of complaints”
“Hot line established to report price gouging”
“Attorney General to crack down on price gouging”
Media Headlines
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True or False: Cost is Knowable
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USTs and $411 Million
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Who Pays for Cap-and Trade?
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Emissions Comparison
Source: T.J. McCann & Associates
Production Transportation to Markets Refining
Refining Byproducts End Use Consumption
Kg
CO
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Ba
rrel
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Structure of Success
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QUALITY EFFICIENCYPRODUCTIVITY
Business Understanding and Business Focus
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