Murphy Oil talks big

Murphy Oil Corp. bought 66 acres of Douglas County land in March 2007 near its Stinson Avenue refinery. Within a year, the publicly traded corporation had vastly expanded its holdings, buying 14 private parcels in the same general area. And purchases continued during the year.

That’s enough to raise eyebrows in a town that for decades has sought economic development. It sent shock waves when residents learned Murphy Oil is thinking big — very big.

If the company can find a suitable partner, it would like to begin a $6 billion refinery expansion. An additional 200,000 barrels per day of production would be added to the current 35,000 barrels.

Throughout the year, however, Refinery Manager Dave Podratz stressed that an expansion in strictly tentative. Without an equity partner, numerous environmental permits and a long-term petroleum supply, it may never become reality.

The project has obvious pros and cons. Favoring construction, it’s along the path of a 36-inch-diameter pipeline being constructed to transport crude oil from Alberta, Canada. Approximately 2.5 trillion barrels of petroleum is available in the Western Canadian province. But the environmental concerns are equally large. Murphy’s land holdings include about 500 acres of wetlands, which are regulated by several state and federal agencies. The company also would have to secure effluent discharge permits.

If plans advance, construction also would pose a challenge. Up to 4,000 workers would be needed, along with facilities to house and feed them.

In an interview, Harvey Doerr, executive vice president of downstream operations and planning at Murphy Oil Corp., said the venture could go either way.

“We see a potential opportunity. Still, there’s a fair amount of possibility that nothing will happen,” he said.

Tags: murphy, oil, refinery, expansion, pollution, environment, lake, superior