Marathon Oil’s Contributions to the Community
The Marathon Oil Company has been under public scrutiny since the community has taken notice of the health problems and the pollution at its oil refinery in southwest Detroit.
Homes surrounding the area of the refinery have been vacant for years while the citizens who are left are unable to afford homes in other places. The zip code of 48217 where the refinery is located has been rated as one of the most polluted in the nation and recorded as the only “non-attainment” area in Michigan by the Environmental Protection Agency. This means that all other areas of Michigan have met air quality standards except for 48217.
In my previous installment in this series on Marathon Oil, I reported on the lawsuit filed on behalf of the residents of southwest Detroit to sue Marathon to reduce its emissions.
I also reported in a prior story for The Mirror News that Mayor Duggan of Detroit promised to sue the company if it is allowed its request to revise its Michigan Department of Environmental Quality permit to allow the emission of more sulfur dioxide in the air, anticipating the potential to exceed emission limits of the EPA set by the Tier 3 Project by the Obama Administration, a project intended to improve air quality in the nation. Currently, the Marathon Oil refinery’s emissions are still within those limits. Emissions from the refinery reach as far as my city of Lincoln Park.
A meeting was to be formally held in the Southwestern Church of God in March where Pastor Jack Perkins and the community neighboring the oil refinery were to discuss concerns with Mayor Duggan. However, the meeting was cancelled. A future meeting is expected to be scheduled. While concerns about emissions remain along with the pending lawsuit, there is also the sense that residents do not necessarily want Marathon Oil to leave southwest Detroit since it contributes to the economy.
While I will cover the expected community meeting with Mayor Duggan for the next issue of The Mirror News, for this story, I set out to see what Marathon has done for the community, and what it continues to do for Michigan.
According to its official company profile, The Marathon Oil Company employs over 45,000 workers nationwide. It’s oil refinery in southwest Detroit is the fourth largest refinery in the U.S. and the largest in the Midwest. It is the only refinery to operate in Michigan. Marathon runs a seven system refinery that operates not only in Michigan, but extends to other states such as Louisiana, Texas, Illinois, and Ohio.
In addition to the refinery, Marathon owns Speedway, which is the second largest convenience store chain in the nation.
Marathon’s annual production was 17 billion barrels of oil, and with the addition of Speedway, now totals 20 billion barrels per year. Along with multiple asphalt refineries, Marathon owns over 4 billion dollars in assets in 2014 alone. About 2.2 billion dollars are added to the Michigan economy due to property taxes, construction projects and company spending in the state. Jamal Kheiry, a public relations representative from Marathon states that 14 million dollars are added to the Michigan economy annually, and that amount will rise to 16 million by 2022.
I interviewed Khiery about the company’s contributions to the community. “Over the years we have projects that [contribute to] Detroit and the Michigan economy,” Jamal Khiery states. “We [Marathon] are in Michigan spending.”
In my first installment of this series I reported on a permit meeting that was held in southwest Detroit. A few concerns were raised by local residents regarding the lack of jobs being offered by Marathon in the surrounding communities. “It’s not like you guys [Marathon] hire any of our guys,” a resident said in the public meeting where Marathon announced its request to revise emissions standards back in February.
I asked Kheiry how the company’s hiring process benefits Detroit, which currently has a 10 percent unemployment rate according to the Bureau of Labor Statistics.
“We hire people within driving distance of the refinery and hold a hiring class once a year,” he replied. “We take on about 20 to 25 people and last year we received over 6000 applications for the positions.”
He explained the desirability of the positions that Marathon offers to Detroiters. “We expand them [positions] and also contract them.” I inquired if salary was substantial for the employees and their families. A previous employee of Marathon agreed that pay grade was “Very good” and considered that the positions are “high paying jobs.”
However, I wondered if the recent drop in oil prices affected the company financially and how they made up for it. “It doesn’t make a difference as an oil refinery because our prices of oil are absolute,” Kheiry states. “But it does increase competition.”
The engine of the oil industry rests mostly on efficiency. All energy is geared towards refining the oil in the most efficient process possible while using the least amount of energy. Prices of crude have dropped which will cause fierce competition among other refineries in terms of energy usage. Energy usage will more or less determine barrel prices, not necessarily oil extraction.
The company boasts a 75% EPA Energy Star rating. In 1992 the Environmental Protection Agency implemented a voluntary national program to beat climate change with businesses and residential homes. Customers were made aware of the benefits of having a product that was awarded an Energy Star, which meant a smaller environmental impact.
According to Marathon’s company profile fact sheet, the EPA has awarded a total of 39 Energy Star awards to refineries. 30 of those awards were given to Marathon, owning a total of 77 percent of the EPA Stars. Despite holding only 10 percent of the United States’ refining capacity, this is the most advancement of any refinery in the nation.
I questioned whether this was subjective to the performance of each refinery. “Each refinery earned Energy Stars differently,” he stated. “What about the Detroit refinery?” I asked.
The EPA awarded Detroit in 2007 through 2012. Kheiry explained information that showed Detroit pulling in a little over 13 percent of the awards. The Energy Star designation seems to contradict the EPA giving the area in Wayne County where the oil refinery is located nonattainment status in 2010; in order to be awarded an Energy Star, the company must have no enforcement actions against it and no outstanding environmental violations.
Mr. Kheiry says of the company’s environmental practices, “[Marathon] adheres to all EPA standards. Our vision is zero problems.”
When reviewing the company’s core values, I asked if they are debated during intense competition. “Our core values are never compromised,” Kheiry replied. “In fact we go the other direction. Employees of Marathon have a right to stop a dangerous or unsafe process; in fact, they are expected to if it means their safety without needing to get the consent of a manager.”
Marathon also holds a community advisory panel every other month to discuss health, environmental, and project information with the community near the refinery. “They are always trying to address their concerns and maintain open communication with the neighborhood,” Kheiry explained. A newsletter is also sent out on a monthly basis to every address in the two zip codes that the refinery overlooks.
I questioned the growing number of vacant homes in the neighborhoods near the refinery, and if the advisory panel worked to change that. “They don’t discuss the vacant homes,” Kheiry replied. “Just information about the projects and refinery.” However, a drive down the factory’s limits show a view of abandoned houses and blight.
I asked the Marathon representative if he had any special statements to make to The Mirror News. “Since 1959, we’ve been a proud member of the community for several decades and proud contributor of Detroit’s success,” Khiery stated. I asked, “Any future plans for Marathon?” According to Khiery, “Nothing slated right now.”