Maryann T. Mannen
Director, President & Chief Executive Officer at Marathon Petroleum
Thanks, Kristina, and good morning, everyone.
We remain committed to peer-leading operational excellence, commercial performance and profitability per barrel in each of the regions in which we operate, while being steadfast in our commitments to safely, reliably operate our assets and protect the health and safety of our employees. The global macro environment continues to exhibit refined product demand growth, and we expect 2024 will be another year of record refined product consumption. Within our domestic and export businesses, we have seen steady year-over-year demand for gasoline and diesel and growth in demand for jet fuels.
Refining margins were volatile in the third quarter as the market digested the implications of a light turnaround season, less seasonal supply interruptions than anticipated and the uncertainties around global economic growth, particularly the pace within China. By leveraging our fully integrated refining system and geographic diversification across the Gulf Coast, Mid-Con and West Coast regions our portfolio of assets is well positioned to perform in this dynamic market environment. Beyond 2024, we expect demand growth to exceed the net impact of capacity additions and rationalizations through the end of the decade. These fundamentals support an enhanced mid-cycle environment for refining. The availability of low-cost energy, the complexity of our facilities and our domestic and international logistical capabilities are further increase our global competitive advantage.
The US refining industry will remain structurally advantaged over the rest of the world. Operational excellence and commercial execution have driven sustainable structural benefit. Our disciplined long-term strategic and quick hit investments are allocated to projects that we believe will achieve attractive returns. These projects are expected to strengthen our competitiveness and position MPC well into the future. We believe prioritization of these capabilities will ensure that our assets will remain the most competitive in each region in which we operate. Positioning us to deliver the strongest through-cycle cash generation and lead in capital allocation. In Midstream, MPLX continues to execute attractive growth opportunities anchored in the Permian and Marcellus basins.
In the third quarter, MPLX began operations at Preakness II, a gas processing plant located in the Permian Basin and today announced an additional processing plant in the Northeast. The Harmon Creek III project will bring Northeast gas processing capacity to 8.1 billion cubic feet per day and fractionation capacity to 800,000 barrels per day once completed in the second half of 2026. Executing its wellhead-to-water strategy, MPLX progressed its natural gas and NGL pipeline projects including the capacity expansion of the BANGL natural gas liquids pipeline and Blackcomb natural gas pipeline in collaboration with its partners. MPLX is strategic to MPC's portfolio, and therefore, its value proposition.
Our Midstream segment, which is primarily comprised of MPLX has grown its adjusted EBITDA by over 6% and on a 3-year annual compound basis through 2023. This growth and the durability of its cash flow profile supported a 12.5% increase to its quarterly distribution increasing the expected annual cash distribution to MPC to $2.5 billion. As MPLX is able to grow its distribution, the cash flow MPC receives is expected to fully cover MPC's dividend and all of our capital programs in 2025. MPLX's growing portfolio and financial flexibility is expected to support this level of annual distribution increases in the future, strengthening the value proposition to MPC.
MPC's total capital return since May 2021 has reduced MPC's share count by over 50% and following last week's announced 10% increase to MPC's dividends. Over the past 3 years, we have grown our quarterly dividend at a compound annual growth rate of approximately 6%. We announced an additional $5 billion share repurchase authorization. This will provide us flexibility to execute our peer-leading capital return commitment. Given our highly advantaged refining business and the $2.5 billion annualized distribution from MPLX, we are positioned to lead peers in capital returns through all parts of the cycle. MPC generated third quarter earnings per share of $1.87. This quarter, we delivered refining utilization at 94%, reflecting our operational excellence and value chain optimization.
Utilization in the West Coast and Mid-Con regions was in the upper 90s, demonstrating strong reliability. Utilization in the US Gulf Coast region reflected execution of turnaround activity. The team executed to deliver capture of 96%, reflecting strong commercial performance in a volatile market. Our capture improved by 2%, exceeding the rate of improvement achieved by our closest peers. This performance drove R&M segment adjusted EBITDA of $3.82 per barrel and cash from operations, excluding the impacts of working capital of $1.9 billion. And in the third quarter, we continue to lead our peers in capital return. The capabilities we have built provide a sustainable advantage, and we expect to continue to see the impact on our quarterly results.
Let me turn the call over to John.