DEBT

Our outstanding borrowings at December 31, 2018 and 2017 consisted of the following:



	December 31,
(In millions)	2018		2017
Marathon Petroleum Corporation:
Commercial paper	$	—	$	—
364-day bank revolving credit facility due September 2019	—		—
Trade receivables securitization facility due July 2019	—		—
Bank revolving credit facility due October 2023	—		—
Senior notes, 2.700% due December 2018	—		600
Senior notes, 3.400% due December 2020	650		650
Senior notes, 5.125% due March 2021	1,000		1,000
Senior notes, 5.375% due October 2022	337		—
Senior notes, 4.750% due December 2023	614		—
Senior notes, 5.125% due April 2024	241		—
Senior notes, 3.625%, due September 2024	750		750
Senior notes, 5.125% due December 2026	719		—
Senior notes, 3.800% due April 2028	496		—
Senior notes, 6.500% due March 2041	1,250		1,250
Senior notes, 4.750% due September 2044	800		800
Senior notes, 5.850% due December 2045	250		250
Senior notes, 4.500% due April 2048	498		—
Andeavor senior notes, 3.800% - 5.375% due 2022 - 2048	469		—
Senior notes, 5.000%, due September 2054	400		400
Capital lease obligations due 2019-2033	629		356



	December 31,
(In millions)	2018			2017
Notes payable	11			—
MPLX LP:
MPLX bank revolving credit facility due 2022	—			505
MPLX senior notes, 5.500% due February 2023	—			710
MPLX senior notes, 3.375% due March 2023	500			—
MPLX senior notes, 4.500% due July 2023	989			989
MPLX senior notes, 4.875% due December 2024	1,149			1,149
MPLX senior notes, 4.000% due February 2025	500			500
MPLX senior notes, 4.875% due June 2025	1,189			1,189
MarkWest senior notes, 4.500% - 5.500% due 2023 - 2025	23			63
MPLX senior notes, 4.125% due March 2027	1,250			1,250
MPLX senior notes, 4.000% due March 2028	1,250			—
MPLX senior notes, 4.800% due February 2029	750			—
MPLX senior notes, 4.500% due April 2038	1,750			—
MPLX senior notes, 5.200% due March 2047	1,000			1,000
MPLX senior notes, 4.700% due April 2048	1,500			—
MPLX senior notes, 5.500% due February 2049	1,500			—
MPLX senior notes, 4.900% due April 2058	500			—
MPLX capital lease obligations due 2020	6			7
ANDX LP:
ANDX revolving and dropdown credit facilities due 2021	1,245			—
ANDX senior notes, 5.500% due October 2019	500			—
ANDX senior notes, 6.250% due October 2022	300			—
ANDX senior notes, 3.500% due December 2022	500			—
ANDX senior notes, 6.375% due May 2024	450			—
ANDX senior notes, 5.250% due January 2025	750			—
ANDX senior notes, 4.250% due December 2027	750			—
ANDX senior notes, 5.200% due December 2047	500			—
ANDX capital lease obligations	15			—
Total	27,980			13,418
Unamortized debt issuance costs	(128		)	(59		)
Unamortized (discount) premium, net	(328		)	(413		)
Amounts due within one year	(544		)	(624		)
Total long-term debt due after one year	$	26,980		$	12,322

Principal maturities for our debt obligations and capital lease obligations as of December 31, 2018 for the next five years were as follows:



(In millions)
2019	$	544
2020	695
2021	2,296
2022	1,320
2023	2,403

Commercial Paper

On February 26, 2016, we established a commercial paper program that allows us to have a maximum of $2 billion in commercial paper outstanding, with maturities up to 397 days from the date of issuance. We do not intend to have outstanding commercial paper borrowings in excess of available capacity under our bank revolving credit facilities. During 2018, we had no borrowings or repayments under the commercial paper program. At December 31, 2018, we had no amounts outstanding under the commercial paper program.

MPC Revolving Credit Agreements

On August 28, 2018, we entered into credit agreements with a syndicate of lenders to replace MPC’s previous five-year $2.5 billion bank revolving credit facility due in 2022 and our previous 364-day $1 billion bank revolving agreement that expired in July 2018. The new credit agreements, which became effective October 1, 2018 in connection with the Andeavor acquisition, provide for a $5 billion five-year revolving credit agreement that expires in 2023 (“new MPC five-year credit agreement”) and a $1 billion 364-day revolving credit agreement that expires in 2019 (“new MPC 364-day credit agreement” and together with the new MPC five-year credit agreement, the “new MPC credit agreements”).

MPC has an option under the new MPC five-year credit agreement to increase the aggregate commitments by up to an additional $1 billion, subject to, among other conditions, the consent of the lenders whose commitments would be increased. In addition, MPC may request up to two one-year extensions of the maturity date of the new MPC five-year credit agreement subject to, among other conditions, the consent of lenders holding a majority of the commitments, provided that the commitments of any non-consenting lenders will terminate on the then-effective maturity date. The new MPC five-year credit agreement includes sub-facilities for swing-line loans of up to $250 million and letters of credit of up to $2.2 billion (which may be increased to up to $3 billion upon receipt of additional letter of credit issuing commitments).

Borrowings under the MPC credit agreements bear interest, at our election, at either the Adjusted LIBO Rate or the Alternate Base Rate (both as defined in the new MPC credit agreements), plus an applicable margin. We are charged various fees and expenses under the MPC credit agreements, including administrative agent fees, commitment fees on the unused portion of the commitments and fees related to issued and outstanding letters of credit. The applicable margin to the benchmark interest rates and the commitment fees payable under the MPC credit agreements fluctuate based on changes, if any, to our credit ratings.

The MPC credit agreements contain certain representations and warranties, affirmative and restrictive covenants and events of default that we consider to be usual and customary for arrangements of this type, including a financial covenant that requires us to maintain a ratio of Consolidated Net Debt to Total Capitalization (each as defined in the MPC credit agreements) of no greater than 0.65 to 1.00 as of the last day of each fiscal quarter. The covenants also restrict, among other things, our ability and/or the ability of certain of our subsidiaries to incur debt, create liens on assets or enter into transactions with affiliates. As of December 31, 2018, we were in compliance with the covenants contained in the MPC credit agreements.

There were no borrowings and $32 million of letters of credit outstanding at December 31, 2018.

Trade Receivables Securitization Facility

On December 18, 2013, we entered into a trade receivables securitization facility (“trade receivables facility”) with a group of committed purchasers and letter of credit issuers evidenced by a receivables purchase agreement and receivables sales agreement. On July 20, 2016, we amended our trade receivables securitization facility to, among other things, reduce the capacity from $1 billion to $750 million and to extend the maturity date to July 19, 2019. The reduction in capacity reflected the lower refined product price environment.

The trade receivables facility consists of one of our wholly-owned subsidiaries, Marathon Petroleum Company LP (“MPC LP”), selling or contributing on an on-going basis all of its trade receivables (including trade receivables acquired from Marathon Petroleum Trading Canada LLC, a wholly-owned subsidiary of MPC LP), together with all related security and interests in the proceeds thereof, without recourse, to another wholly-owned, bankruptcy-remote special purpose subsidiary, MPC Trade Receivables Company LLC (“TRC”), in exchange for a combination of cash, equity and/or a subordinated note issued by TRC to MPC LP. TRC, in turn, has the ability to sell undivided ownership interests in qualifying trade receivables, together with all related security and interests in the proceeds thereof, without recourse, to the purchasing group in exchange for cash proceeds. The trade receivables facility also provides for the issuance of letters of credit up to $750 million, provided that the aggregate credit exposure of the purchasing group, including outstanding letters of credit, may not exceed the lesser of $750 million or the balance of qualifying trade receivables at any one time.

To the extent that TRC retains an ownership interest in the receivables it has purchased or received from MPC LP, such interest will be included in our consolidated financial statements solely as a result of the consolidation of the financial statements of TRC with those of MPC. The receivables sold or contributed to TRC are available first and foremost to satisfy claims of the creditors of TRC and are not available to satisfy the claims of creditors of MPC. TRC has granted a security interest in all of its assets to the purchasing group to secure its obligations under the Receivables Purchase Agreement.

Proceeds from the sale of undivided percentage ownership interests in qualifying receivables under the trade receivables facility are reflected as debt on our consolidated balance sheet. We remain responsible for servicing the receivables sold to the purchasing group. TRC pays floating-rate interest charges and usage fees on amounts outstanding under the trade receivables facility, if any, unused fees on the portion of unused commitments and certain other fees related to the administration of the facility and letters of credit that are issued and outstanding under the trade receivables facility.

The receivables purchase agreement and receivables sale agreement contain representations and covenants that we consider usual and customary for arrangements of this type. Trade receivables are subject to customary criteria, limits and reserves before being deemed to qualify for sale by TRC pursuant to the trade receivables facility. In addition, further purchases of qualified trade receivables under the trade receivables facility are subject to termination, and TRC may be subject to default fees, upon the occurrence of certain amortization events that are included in the receivables purchase agreement, all of which we consider to be usual and customary for arrangements of this type. As of December 31, 2018, we were in compliance with the covenants contained in the receivables purchase agreement and receivables sale agreement.

There were no borrowings or letters of credit outstanding under the trade receivables facility as of December 31, 2018. As of December 31, 2018, qualified trade receivables supported borrowings and letter of credit issuances of $750 million.

MPC Senior Notes

As a result of the completion of the Andeavor acquisition, we assumed an aggregate principal amount of $3.374 billion senior notes issued by Andeavor. On October 2, 2018, approximately $2.905 billion aggregate principal amount of Andeavor’s outstanding senior notes were exchanged for new unsecured senior notes issued by MPC having the same maturity and interest rates as the Andeavor senior notes and cash in an exchange offer and consent solicitation undertaken by MPC and Andeavor.

The new MPC senior notes consist of approximately $337 million aggregate principal amount of 5.375 percent senior notes due October 1, 2022, approximately $614 million aggregate principal amount of 4.750 percent senior notes due December 15, 2023, approximately $241 million aggregate principal amount of 5.125 percent senior notes due April 1, 2024, approximately $719 million aggregate principal amount of 5.125 percent senior notes due December 15, 2026, approximately $496 million aggregate principal amount of 3.800 percent senior notes due April 1, 2028 and approximately $498 million aggregate principal amount of 4.500 percent senior notes due April 1, 2048.

After giving effect to the exchange offer and consent solicitation referred to above, as of December 31, 2018, Andeavor had outstanding approximately $138 million aggregate principal amount of 5.375 percent senior notes due October 1, 2022, approximately $236 million aggregate principal amount of 4.750 percent senior notes due December 15, 2023, approximately $59 million aggregate principal amount of 5.125 percent senior notes due April 1, 2024, approximately $30 million aggregate principal amount of 5.125 percent senior notes due December 15, 2026, approximately $4 million aggregate principal amount of 3.800 percent senior notes due April 1, 2028 and approximately $2 million aggregate principal amount of 4.500 percent senior notes due April 1, 2048.

Interest on each series of senior notes is payable semi-annually in arrears. The MPC senior notes are unsecured and unsubordinated obligations of MPC and rank equally with all of MPC’s other existing and future unsecured and unsubordinated indebtedness. The MPC senior notes are non-recourse and structurally subordinated to the indebtedness of our subsidiaries, including the outstanding indebtedness of Andeavor, MPLX and ANDX. The Andeavor senior notes are unsecured, unsubordinated obligations of Andeavor and are non-recourse to MPC and any of MPC’s subsidiaries other than Andeavor.

On March 15, 2018, we redeemed all of the $600 million outstanding aggregate principal amount of our 2.700 percent senior notes due on December 14, 2018. The 2018 senior notes were redeemed at a price equal to par plus a make whole premium, plus accrued and unpaid interest. The make whole premium of $2.5 million was calculated based on the market yield of the applicable treasury issue as of the redemption date as determined in accordance with the indenture governing the 2018 senior notes.

MPLX Credit Agreement

On July 21, 2017, MPLX entered into a credit agreement with a syndicate of lenders to replace MPLX’s previous $2 billion five-year bank revolving credit facility with a $2.25 billion five-year bank revolving credit facility that expires in July 2022 (“MPLX credit agreement”).

The MPLX credit agreement includes letter of credit issuing capacity of up to approximately $222 million and swingline loan capacity of up to $100 million. The revolving borrowing capacity may be increased by up to an additional $500 million, subject to certain conditions, including the consent of the lenders whose commitments would increase.

Borrowings under the MPLX credit agreement bear interest, at MPLX’s election, at the Adjusted LIBO Rate or the Alternate Base Rate (both as defined in the MPLX credit agreement) plus an applicable margin. MPLX is charged various fees and expenses in connection with the agreement, including administrative agent fees, commitment fees on the unused portion of the commitments and fees with respect to issued and outstanding letters of credit. The applicable margins to the benchmark interest rates and the commitment fees payable under the MPLX credit agreement fluctuate based on changes, if any, to MPLX’s credit ratings.

The MPLX credit agreement contains certain representations and warranties, affirmative and restrictive covenants and events of default that we consider to be usual and customary for an agreement of this type, including a financial covenant that requires MPLX to maintain a ratio of Consolidated Total Debt as of the end of each fiscal quarter to Consolidated EBITDA (both as defined in the MPLX credit agreement) for the prior four fiscal quarters of no greater than 5.0 to 1.0 (or 5.5 to 1.0 for up to two fiscal quarters following certain acquisitions). Consolidated EBITDA is subject to adjustments for certain acquisitions completed and capital projects undertaken during the relevant period. The covenants also restrict, among other things, MPLX’s ability and/or the ability of certain of its subsidiaries to incur debt, create liens on assets and enter into transactions with affiliates. As of December 31, 2018, MPLX was in compliance with the covenants contained in the MPLX credit agreement.

During 2018, MPLX borrowed $1.410 billion under the bank revolving credit facility, at an average interest rate of 3.464 percent, per annum, and repaid $1.915 billion of these borrowings. As of December 31, 2018, MPLX had no outstanding borrowings and $3 million of letters of credit outstanding under the bank revolving credit facility, resulting in total unused loan availability of $2.25 billion.

MPLX Term Loan

On January 2, 2018, MPLX entered into a term loan agreement with a syndicate of lenders providing for a $4.1 billion, 364-day term loan facility. MPLX drew the entire amount of the term loan facility in a single borrowing to fund the cash portion of the consideration for the February 1, 2018 dropdown. On February 8, 2018, MPLX used $4.1 billion of the net proceeds from the issuance of MPLX senior notes to repay the 364-day term-loan facility.

MPLX Senior Notes

On November 15, 2018, MPLX issued $2.25 billion in aggregate principal amount of senior notes in a public offering, consisting of $750 million aggregate principal amount of 4.800 percent unsecured senior notes due February 2029 and $1.5 billion aggregate principal amount of 5.500 percent unsecured senior notes due February 2049. On December 10, 2018, a portion of the net proceeds from the offering was used to redeem the $750 million in aggregate principal amount of 5.500 percent unsecured notes due February 2023 issued by MPLX and MarkWest. These notes were redeemed at 101.833 percent of the principal amount, plus the write off of unamortized deferred financing costs, resulting in a loss on extinguishment of debt of $60 million. The remaining net proceeds have or will be used to repay borrowings under MPLX’s revolving credit facility and intercompany loan agreement with MPC and for general partnership purposes.

On February 8, 2018, MPLX issued $5.5 billion in aggregate principal amount of senior notes in a public offering, consisting of $500 million aggregate principal amount of 3.375 percent unsecured senior notes due March 2023, $1.25 billion aggregate principal amount of 4.000 percent unsecured senior notes due March 2028, $1.75 billion aggregate principal amount of 4.500 percent unsecured senior notes due April 2038, $1.5 billion aggregate principal amount of 4.700 percent unsecured senior notes due April 2048, and $500 million aggregate principal amount of 4.900 percent unsecured senior notes due April 2058. On February 8, 2018, $4.1 billion of the net proceeds were used to repay the 364-day term-loan facility. The remaining proceeds were used to repay outstanding borrowings under MPLX’s revolving credit facility and intercompany loan agreement with MPC and for general partnership purposes.

Interest on each series of MPLX senior notes is payable semi-annually in arrears. The MPLX senior notes are unsecured, unsubordinated obligations of MPLX and are non-recourse to MPC and its subsidiaries other than MPLX and MPLX GP LLC, as the general partner of MPLX.

ANDX Credit Agreements

ANDX is party to a $1.1 billion revolving credit facility and a $1.0 billion dropdown credit agreement, both of which expire in January 2021 (together, the “ANDX credit agreements”). The ANDX credit agreements are unsecured, but are guaranteed by substantially all of ANDX’s subsidiaries.

The ANDX revolving credit facility includes letter of credit issuing capacity of up to $300 million and swingline loan capacity of up to $50 million. The aggregate borrowing capacity under the ANDX credit agreements may be increased by up to an additional $500 million, subject to certain conditions, including the receipt of additional lender commitments.

Borrowings under the ANDX credit agreements bear interest, at ANDX’s election, at LIBOR or the Base Rate (as defined in the ANDX credit agreements) plus an applicable margin. ANDX is charged various fees and expenses in connection with the agreement, including administrative agent fees, commitment fees on the unused portion of the commitments and fees with respect to issued and outstanding letters of credit. The applicable margins to the benchmark interest rates and the commitment fees payable under the ANDX credit agreements fluctuate based on changes, if any, to ANDX’s credit ratings.

The ANDX credit agreements contain certain representations and warranties, affirmative and restrictive covenants and events of default that we consider to be usual and customary for an agreement of this type, including a financial covenant that requires ANDX to maintain a Consolidated Leverage Ratio (as defined in the ANDX credit agreements) for the prior four fiscal quarters of no greater than 5.0 to 1.0 (or 5.5 to 1.0 for up to two fiscal quarters following certain acquisitions). Consolidated EBITDA used to calculate the Consolidated Leverage Ratio is subject to adjustments for certain acquisitions completed and capital projects undertaken during the relevant period. The covenants also restrict, among other things, ANDX’s ability and/or the ability of certain of its subsidiaries to incur debt, create liens on assets and enter into transactions with affiliates. As of December 31, 2018, ANDX was in compliance with the covenants contained in the ANDX credit agreements.

On December 20, 2018, ANDX amended the ANDX credit agreements to, among other things, revise the affirmative and negative covenants and events of default to be commensurate with those customarily contained in investment-grade credit facilities of a similar type and nature. Specifically, among other things, the amendments (i) granted additional flexibility to ANDX and its subsidiaries to create liens and incur indebtedness, subject to the Consolidated Leverage Ratio covenant described above, (ii) remove restrictions on the ability of ANDX and its subsidiaries to make investments and (iii) granted additional flexibility to ANDX and its subsidiaries to enter into acquisitions, sell or dispose of assets and enter into related party transactions. In addition, the amendments made certain legal and technical updates to the ANDX credit agreements, including the removal of collateral and security provisions that are no longer applicable and changes to reflect MPC’s acquisition of Andeavor. The amendments did not impact the borrowing capacity available to ANDX or the interest rates and other fees payable by ANDX under the Credit Agreements.

During the fourth quarter of 2018, ANDX borrowed $760 million under the ANDX credit facilities, at an average interest rate of 4.460 percent and repaid $635 million of these borrowings. As of December 31, 2018, ANDX had $1,245 million outstanding borrowings under the ANDX credit facilities, resulting in total unused loan availability of $855 million.

ANDX Senior Notes

As of December 31, 2018, ANDX had $3.750 billion aggregate principal amount of senior notes outstanding. The ANDX senior notes consist of $500 million aggregate principal amount of 5.500 percent senior notes due October 15, 2019, $500 million aggregate principal amount of 3.500 percent senior notes due December 1, 2022, $300 million aggregate principal amount of 6.250 percent senior notes due October 15, 2022, $450 million aggregate principal amount of 6.375 percent senior notes due May 1, 2024, $750 million aggregate principal amount of 5.250 percent senior notes due January 15, 2025, $750 million aggregate principal amount of 4.250 percent senior notes due December 1, 2027 and $500 million aggregate principal amount of 5.200 percent senior notes due December 1, 2047.

Interest on each series of ANDX senior notes is payable semi-annually in arrears. The ANDX senior notes are unsecured, unsubordinated obligations of ANDX and are non-recourse to MPC and its subsidiaries other than ANDX and Tesoro Logistics GP, LLC, as the general partner of ANDX.