21. Subsequent Events

Pending Acquisition of Texas City Refinery and Related Logistics and Marketing Assets

On October 7, 2012, we entered into a purchase and sale agreement with BP Products North America Inc. and BP Pipelines (North America) Inc. (collectively, “BP”) to purchase BP’s 451,000 barrel per calendar day Texas City, Texas refinery, three intrastate natural gas liquid pipelines originating at the refinery, an allocation of BP’s Colonial Pipeline Company shipper history, four light product terminals, branded-jobber marketing contract assignments for the supply of approximately 1,200 branded sites and a 1,040 megawatt electric cogeneration facility. The base purchase price is $598 million plus the value of inventories at the time of closing, which at current prices is estimated at approximately $1.2 billion. Pursuant to the purchase and sale agreement, we may also be required to pay to BP a contingent earnout of up to an additional $700 million over six years, subject to certain conditions. These assets complement our current geographic footprint and align with our strategic initiative of growing in existing and contiguous markets to enhance our portfolio. The transaction is expected to be funded with cash on hand, and is anticipated to close early in 2013, subject to the satisfaction of customary closing conditions, including regulatory approvals.

Initial Public Offering of MPLX

In 2012, we formed MPLX to own, operate, develop and acquire crude oil, refined product and other hydrocarbon-based product pipelines and other midstream assets. On October 31, 2012, MPLX closed its initial public offering of 19,895,000 common units at a price of $22.00 per unit, which included 2,595,000 units purchased by the underwriters through an over-allotment option. Net proceeds to MPLX from the sale of the units was approximately $405 million, net of underwriting discounts and commissions, structuring fees and estimated offering expenses (the “Offering Costs”) of $31 million and financing costs of $2 million. MPLX contributed approximately $192 million to MPLX Pipe Line Holdings LP (“Pipe Line Holdings”), a subsidiary of MPLX, which Pipe Line Holdings will retain on behalf of MPLX and us to fund our respective pro rata portions of certain estimated expansion capital expenditures. MPLX distributed net proceeds to us of $203 million, in partial consideration of assets contributed and to reimburse us for certain capital expenditures incurred with respect to these assets. MPLX GP LLC, a wholly-owned subsidiary of MPC, serves as the general partner of MPLX. We own a 73.6 percent interest in MPLX, including the general partner interest, and we expect to consolidate this entity for financial reporting purposes. The initial public offering represented the sale of a 26.4 percent interest in MPLX. Headquartered in Findlay, Ohio, MPLX’s initial assets consist of a 51 percent indirect interest in a network of common carrier crude oil and product pipeline systems and associated storage assets in the Midwest and Gulf Coast regions of the United States and a 100 percent interest in a butane storage cavern in West Virginia.

The following table is a reconciliation of proceeds from the offering:


(In millions)
Total proceeds from the offering	$	438
Less: Offering Costs		(31	)
Less: Revolving credit facility origination fees		(2	)

Net proceeds from the offering		405
Less: Cash retained by MPLX		(10	)
Less: Cash contribution to Pipe Line Holdings		(192	)

Net proceeds distributed to MPC from the offering	$	203

Second Accelerated Share Repurchase Program

On November 5, 2012, we announced that we entered into a $500 million ASR program. This ASR is the second tranche of share repurchases under the $2 billion share repurchase plan authorized by our board of directors in February 2012. The total number of shares to be repurchased will be based generally on the volume-weighted average price of MPC common stock during the repurchase period. It is anticipated that all market repurchases under the ASR will be completed before the end of the first quarter of 2013. As received, we will record the shares acquired as treasury stock. The total value of share repurchases pursuant to the two ASR programs implemented by MPC in 2012 is approximately $1.35 billion, with $650 million remaining under the current authorization.