In 2007 President Bush signed into law a requirement that oil refiners blend 11 billion gallons of biofuels with their gasoline this year and 15 billion gallons by 2015.
Recognizing the need to secure biofuel resources, Murphy Oil Corp. purchased through a subsidiary a corn-based ethanol plant in Hankinson, N.D. for $92 million, the company said Oct. 1. Murphy Oil President and CEO David Wood cited the plant's proximity to corn supplies and rail lines as reasons for selecting the site.
"We are adding this capability to supplement our growing North American fuels business," Wood said in a statement. "It also marks our initial entry into the manufacture of biofuels. Given the current ethanol mandates and our subsequent blending needs, having more of a presence in the supply chain better balances our business."
The plant began operating in July 2008 before being idled three months later. It has an annual production capacity of 110 million gallons. The company plans to make $15 million worth of capital investments into the facility.
Ethanol production is expected to rise dramatically in the United States and worldwide. U.S. growth is expected to reach 35% by 2015, according to a study released Sept. 30 by Hart's Global Biofuels Center. Meanwhile, other world economies also anticipate major growth. Brazil will increase domestic supplies by 30% and more than double export volume, the study shows. Indonesia and Malaysia will more than double production of palm oil biodiesel, while Germany will remain the largest producer of biofuels in Europe.
At A Glance
Murphy Oil Corp.
El Dorado, Arkansas
Primary Industry: Petroleum & Coal Products
Number of Employees: 8,277
2008 In Review
Revenue: $27.51 billion
Profit Margin: 6.32%
Sales Turnover: 2.47
Inventory Turnover: 35.18
Revenue Growth: 49.21%
Return On Assets: 16.52%
Return On Equity: 34.35%
The company continues oil exploration projects, with four announced during the second quarter. Murphy Oil also began production in recent months at several new fields, including from offshore Malaysia, the company said on Sept. 17. Natural gas produced from the phased development of the Malaysian fields will be supplied to the Petronas LNG complex in Bintulu, Sarawak, Malaysia.
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