By LOU WILIN
When Pam Beall recently became president of Marathon Petroleum’s pipeline subsidiary, MPLX LP, she took on a lot of high hopes.
The pipeline operations were spun off a year and a half ago into a publicly-traded corporation, pleasing investors. MPLX offers them a piece of the oil business which earns more steady profits than the yo-yo fortunes of refining. Because of that, it pays bigger dividends regularly, which investors like.
It also offers investors growth prospects. Marathon Petroleum can sell more pipelines or barges or other assets to MPLX, which will help it earn yet more profits. Middle North America is booming with lots of cheaper crude oil, which refiners are rushing to buy to turn a good profit. To supply the growing demand for oil, pipelines are being built and more planned.
“There is a significant financial element associated with (MPLX) and managing growth and managing investor expectations over time,” Beall said.
Beall’s financial expertise was among the main reasons she was named president of MPLX, said Gary Heminger, chief executive officer of Marathon Petroleum Corp.
With her financial background, she will be more sensitive than, say, an engineer might be, about paying cash to investors in dividends, said John Parry, retired principal analyst for IHS Herold, Norwalk, Conn. An engineer might tend to be more inclined to invest more money in the business, he said.
It is ironic that Beall in high school wanted to be a petroleum engineer. She was steeped in the oil business growing up because her father, Jim Moses, was a Marathon Oil accountant who became manager of production revenue accounting.
“Now my father told me that a lot of would-be engineers change and go the direction of accounting,” she said, then laughed. “I don’t know how accurate that is. That was probably him trying to shape my future.”
She first went to Purdue University to become an engineer.
“At some point, I realized what really fascinated me about the industry was the impact that oil and gas have on the global economy, energy policy, politics,” she said. “It’s so essential to everything, our modern way of life.”
So Beall switched to accounting, earned a bachelor’s degree in accounting from the University of Findlay, and became a certified public accountant. She went on to earn a master’s degree in business administration from Bowling Green State University.
Growing up in a Marathon household, Beall was thrown into what would be a challenging change for any teenager. Her father’s job transfer moved the family from Arlington, Ohio, to Casper, Wyo., as she was starting high school. She went from a class of 60 in Arlington to over 600 in Casper.
“What a change, but that also helped me to appreciate. You know, Marathon likes people to move around and gain a lot of different experiences, and that can be really hard on families,” Beall said. “I can tell you, at that time, I didn’t think that was a great idea to move to Casper, Wyo., but it didn’t take long to realize that it was the best thing that ever happened to me personally.”
It expanded her view of the world. It helped her see more opportunities. It made her more adaptable.
“By experiencing that change in my high school years — and a lot of families do it much sooner, Marathon families — I think it just helps prepare you for what you’re going to face inevitably: change,” she said. “And the more adaptable that we become to change, the greater our chances are to be successful.”
For her entire career, Beall has worked to succeed.
“Some people kind of work to live, other people live to work, and I would put myself in that latter category,” she said.
Heminger, who has known her since both came to Marathon in the 1970s, talked about Beall’s strong work ethic.
“She is a tireless worker,” he said.
In fact, it was Heminger who recruited Beall back to Marathon in 2002, after she had been away for 17 years with NationsRent and then OHM Corp.
“She has the highest integrity and outstanding financial and commercial skills,” Heminger said. “She is very good at developing people and has very high leadership skills. She’s a very, very well-rounded talent.”
So, hopes are high for Beall and MPLX. The 150 employees to be added over the next three years on East Hardin Street will work for MPLX.
MPLX will have its own six-story headquarters across Hardin Street from Marathon Petroleum’s headquarters.
Opportunities abound. The oil boom in middle North America is flooding the market with oil, further lowering its price relative to crude elsewhere. Marathon Petroleum and others are buying as much as they can, refining it and then selling it as fuel at a big profit. To get more of the oil, more pipelines, barges, rail and trucks are needed.
“There is a tremendous amount of capital that is going to be invested in this space and (MPLX) is one of the ways that (Marathon Petroleum) wants to participate in that growth,” Beall said.
Over the next three years, Marathon Petroleum will invest $2.4 billion more in transportation- and logistics-related operations than it did in the past three years, a “very significant shift in the spending and focus on where the growth capital will be deployed,” Beall said.
A $140 million pipeline under construction by MPLX, for example, will extend 49 miles from the Utica Shale in eastern Ohio to Marathon Petroleum’s Canton refinery.
Marathon Petroleum is spending hundreds of millions of dollars on new pipelines elsewhere in the Midwest, expecting to sell at least some of those interests to MPLX, Beall said. It also plans to eventually sell to MPLX some interest in barges which carry crude oil and fuels on the Mississippi and Ohio rivers. Distribution terminals, rail operations and trucks, too, could end up among MPLX’s assets.
Part of Beall’s challenge as president of MPLX will be to bring it outside the Marathon Petroleum umbrella and broaden its customer base. Today, MPLX generates about 90 percent of its revenue from Marathon Petroleum’s use of its pipelines. Beall will have to prioritize options among capital investments and purchases of other companies’ assets, Heminger said.
She is prepared for it. She spent much of her career in business development positions and, in what she calls a “nice overlap,” she already is senior vice president of corporate planning for Marathon Petroleum.
Other women have risen to similar positions at Marathon over the years, Beall said. Mary Ellen Peters, now retired, became president of the subsidiary Marathon Pipeline in 1996.
But Beall is the first woman to head a Marathon subsidiary that is a public company.
“There are tremendous opportunities for women, I would say in the oil and gas industry, that did not evolve maybe as quickly as it may have in other industries,” she said.
That partly was because fewer women entered technical areas, she said. But that is changing.
“Certainly there are quite a few women in the financial arena. But I see a growing number of women with engineering degrees coming into the workforce at Marathon Petroleum, and I think that you will continue to see a lot more female executives and a lot more minority representation in the workforce. That’s certainly a focus of the leadership,” Beall said. “I guess what I would just say is, I wish I were starting my career today as a female professional at Marathon Petroleum.”
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