Murphy Exits Refineries, Enters Electric Vehicles

by Arkansas Business Staff  on Monday, Oct. 10, 2011 12:00 am  

A customer charges her Nissan Leaf at Murphy USA of El Dorado's new retail charger at a gas station in Chattanooga, Tenn.

Murphy Oil Corp. of El Dorado, in jettisoning its refinery business and rolling out its first electric vehicle charging station, seems to be eyeing a world that's a bit less oily.

Since July 2010, the company has been making a mad dash out of the oil refinery business. At the beginning of 2011, Murphy owned three oil refineries - one in Wisconsin, one in Louisiana and one in Great Britain.

As of last week, the two domestic facilities have been packed up and sold.

The sales make plenty of sense: The Meraux, La., refinery cost Murphy big bucks when Hurricane Katrina struck in 2005. The residents of Meraux weren't too thrilled when a million gallons of oil spilled through their town, damaging 10,000 homes.

The victims sued Murphy and in January 2007, the company settled the lawsuit for $330 million.

Five years later, both refineries were found to have violated the Environmental Protection Agency's Clean Air Act, costing Murphy $1.25 million in fines. Of that, $625,000 went to the U.S. government, $229,687 to Wisconsin and $395,312 to Louisiana. The company then set about spending $142 million to fix the problems that led to the fines.

The two complexes finally sold for a total of about $1 billion. Meraux went to Valero Energy Corp. of San Antonio, and the refinery in Superior, Wis., went to Calumet Specialty Products Partners LP of Indianapolis.

The third refinery is in Milford Haven, Wales, and is still up for sale. Murphy owns 457 gas stations across Great Britain.

David M. Wood, Murphy's CEO, has said the refineries accounted for $4.2 million, or 0.5 percent, of Murphy's 2009 net income of $837.6 million. In the first-quarter earnings report, Wood said he hopes to focus Murphy's efforts on exploration, production and retail.

The company ended the first half of 2011 with profit of $580 million on revenue of $16 billion.

 

Charging to the Future

 

 

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